Readers’ Forum

Feb. 9, 2007

Ground Support Worldwide goes to the front lines of the industry to get feedback on the hot topics surrounding ground support equipment and ground handling.

With the focus shifting to more regional jets in smaller markets, do you think outsourced ground handling will become more prevalent? Will that mean more ground equipment purchases for the vendors taking over these contracts?

Rhonda Hamm-Niebruegge
Managing Director, American Airlines — St. Louis’ Hub

As this industry continues to change and size markets to meet passenger demand, I think the overall face of the industry will also continue to change. Many of the legacy carriers have employees that are employed for the mainline operation and another set of employees—albeit different pay scales and benefits—who work for the commuter operation or feeder subsidiary. That being said, I don’t foresee a dramatic move towards outsourcing the regional jet operations in the coming years. What I do expect is that the number of employees will continue to grow for the regional operations and decrease for the legacy mainline carriers. A lot of this will come in the form of attrition due to a very senior workforce in the majority of the legacy carriers, but the timing is perfect as carriers look to shrink unprofitable domestic mainline markets and grow the commuter/regional jet operations. The need and demand for outsourcing ground handling contracts is still a valued part of this industry and one that is particularly needed in very small markets. Many times a fixed based operator can have several contracts at a single airport giving them an edge on productivity and costs that make it difficult for an airline to be price competitive with their own employees and staff a market with three or four flights a day. The FBO can handle multiple carriers and cross utilize the employees over the day, making a cost effective model that is difficult for legacy carriers to recognize.

As far as ground equipment and if the demand will grow for new purchases, I still think that aspect will stay somewhat flat. Many times when carriers outsource a city, they have existing equipment and the FBO contract can be drawn up to include the purchase of that ground equipment or a lease
of same.

Larry Laney
Director Ground Support, Southwest Airlines

When it comes to regional jets and their continued growth it seems as though there are two trends happening. One, legacy carriers are using their larger aircraft for international service and using more regional jets for domestic. Secondly, you have low cost carriers starting to add regional jets to service smaller markets and feed their own network, such as what JetBlue has done with the Embraer 190.

Obviously, Southwest is paying close attention to what is happening in our Industry and we have looked at several RJ’s including the Embraer 190.
If you were to ask me five years ago, would Southwest consider adding RJ’s to our fleet? I would have said ‘not in a million years.’ However, in today’s world I would never say never. After all I thought we would never get rid of our plastic boarding cards. Let alone code share with another carrier! So what do I know?

Based on the strong demand for these aircrafts, it should boost the sale of ground equipment to support them, although, the equipment may
be fewer and somewhat less expensive, growth of any kind is better than no growth.

Brian Wood
VP Operations, Airport Terminal Services, Inc.

I believe in the short term the introduction of regional jets into an operation can drive the need for additional GSE. For example, it may require the addition of a low profile lav or water cart or a smaller pushback unit.

However long term, they simply require less GSE. It takes less bagcarts, tugs and beltloaders to work these flights. That reduced need will ultimately drive less GSE to be replaced or added to support regional growth.