Northwest Airlines plans to assign 15 50-seat regional jets to Mesaba Airlines and could send 20 more to the regional carrier in coming years. That portends a big spike in flying by Mesaba and it said Friday it plans to hire hundreds of employees.
The planes, Canadian-made Bombardier CRJ-200 regional jets, are expected to start entering service in September.
Until now, Northwest steered its new CRJs to its other regional airline partner, Pinnacle Airlines. By this August, Memphis, Tenn.-based Pinnacle will be flying 139 of the 44- or 50-seat planes.
Northwest and Mesaba are entering into a 10-year deal covering the operation of the regional jets. New 10-year deals covering Mesaba's operation of Avro RJ85s and Saab 340s planes also are in the works.
"This is a huge vote of confidence in us by Northwest Airlines," said John Spanjers, Mesaba president and chief operating officer.
Eagan-based Mesaba won the contract to fly the planes with its operational performance, safety record and competitive bid prices, he said.
Though he would not talk specific dollars, Spanjers said Mesaba had made itself more cost competitive with the pilot contract it negotiated in 2004. That helped position it to beat out Pinnacle and other possible competitors for the regional jets.
"When we went through the pilot negotiations, one goal was to come out with a contract that would allow us to compete very aggressively for the CRJs," said Spanjers.
That contract was more than 2½ years in the making and came only after deadline talks went into overtime and Mesaba canceled hundreds of flights, anticipating a possible strike.
Mesaba pilots now start at about $22,000 a year. Top pay, after 16 years of service, is nearly $95,000.
As it takes on the 15 new jets, Mesaba expects to hire some 300 employees, including 60 flight attendants and 150 pilots.
Both Pinnacle and Mesaba fly exclusively for Northwest, primarily shuttling passengers between Northwest hubs and smaller markets. Northwest, which is generally entitled to all revenue associated with the flights, pays the carriers to operate the planes.
Northwest controls the scheduling, pricing, reservations, and ticketing of Pinnacle and Mesaba flights.
Airlines use regional jets to open new markets and grow routes that don't have enough people to warrant larger planes. Carriers also use the jets to maintain or increase flight frequencies when larger jets would not make sense.
Pilots and other employees at regional carriers typically don't make as much money as workers at the mainline carriers. Northwest's contract with its own pilots restricts some flying that can be done by Pinnacle and Mesaba.
In the past few years, Pinnacle grew rapidly as Northwest sent more planes and flying its way. Last year, Mesaba carried 5.4 million passengers for Northwest; Pinnacle, 6.3 million.
Now, Mesaba, which has 3,600 employees, including 1,500 in the Twin Cities, has a shot at some serious growth.
With the new planes heading to Mesaba, pilots see opportunities for advancement, with more captains' seats opening up, said Tom Wychor, chairman of the Mesaba pilot union's master executive council.
"This means very good things for Mesaba Airlines and Mesaba pilots,'' he said. "More growth and more stability."
About 350 of Mesaba's 860 pilots are based in the Twin Cities.
The deal with Northwest puts MAIR Holdings Inc., Mesaba's Minneapolis-based parent company, on the hook for about $10 million in costs associated with working the jets into Mesaba's fleet, including training and the purchase of maintenance equipment, said UBS airline analyst Robert Ashcroft
The deal should increase MAIR's earnings, though, he said.
"This gives MAIR some stability to the extent any regional airline has stability,'' he wrote in a Friday research note.
Northwest wouldn't say Friday how the assignment of the planes to Mesaba may affect Pinnacle .
Northwest has said it expects flying by its regional carriers to increase by 33 percent this year while its own flying will be flat.