Mesa posts $47.6m second-quarter loss due to lower block hours, ‘captain crunch’

Mesa Air Group lost $47.6m during its fiscal third quarter, with the airline’s block hours plummeting during its transition to flying its Bombardier CRJ-900s on behalf of United Airlines. The parent company of Mesa Airlines lost $10m during the same period of 2022. “We’re not particularly pleased with these numbers,” CE Jonathan Ornstein said during the company’s 9 August quarterly earnings call. “We know that things have to change. The good news is that we feel we have a very strong partner to help make that happen.” The Phoenix-based carrier generated $115m in quarterly revenue, down from $134m last year, as contract revenue decreased nearly 21%. “These decreases were primarily driven by 50% reduction in CRJ-900 block hours and fewer aircraft, partially offset by higher United block-hour rates for new pilot pay scales,” Mesa says. The regional carrier is also struggling to hire enough pilots to fully utilise its fleet amid the industry-wide shortage of qualified flight crews, which Ornsteins calls a “captain crunch”. “In spite of consistently adding pilots from January to present, we’re still only flying approximately 70% of our full utilisation capacity, which we believe is consistent with other regional carriers in the United portfolio,” Ornstein says. “To meet United’s target utilisation, we will need approximately 150 more pilots, primarily captains.” “Given our current pilot outlook as well as cooperation and support from United Airlines, we believe we will reach United’s target utilisation by the end of fiscal year 2024,” he adds. The carrier’s transition away from flying on behalf of former mainline partner American Airlines “has not been easy”, Ornstein adds, as United “took a particularly conservative approach” to scheduling Mesa’s block hours during the quarter. Moving forward, “more efficient scheduling” could boost Mesa’s block hour production, he says. <br/>