ExpressJet Airlines, a wholly-owned subsidiary of SkyWest, Inc. (NASDAQ: SKYW) this week announced the initiation of a clearly defined long-term strategy.
- Long-term agreement secured with United Airlines. As part of this plan, ExpressJet has secured a new, five-year extension of its United Airlines ERJ145 contract, effective Jan. 1, 2018 through Dec. 31, 2022. The new agreement enhances ExpressJet's United partnership and provides long-term stability to its model. It also provides ExpressJet pilots with continued access to United's Career Pathway Program. Financial terms of the agreement were not disclosed.
- Early termination of Delta CPA. Additionally, ExpressJet and Delta Air Lines mutually agreed to initiate the wind-down of its remaining dual-class flying agreement under the Delta Connection brand, allowing ExpressJet opportunities to place aircraft with other partners. The agreement, which includes 28 CRJ900s and 33 CRJ700s, was previously scheduled to expire beginning in 2019. The aircraft financed by Delta, including all CRJ900s, will be returned to Delta beginning in fourth quarter 2017; ExpressJet expects to transition other aircraft previously operated under its Delta agreement to other major partners throughout 2018.
- Agreement with American for eight additional CRJ700s. As part of this realignment, ExpressJet has secured an agreement with American Airlines to transition eight additional CRJ700s to its American Eagle operation. That transition is expected to take place during second quarter 2018.
"Today's announcement provides structural strength, visibility and positive momentum to ExpressJet Airlines," said Chip Childs, Chief Executive Officer of SkyWest, Inc. "Our objective to provide a strong and successful foundation for the people of ExpressJet is central to our strategy. The execution of these new agreements is essential to finally getting ExpressJet to long-term success and profitability."
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