Mesa Air Wants to Back Out of Flying to Utah Cities

May 31, 2007
"Numerous" people upset by canceled and delayed flights, lost luggage, and poor customer service

On Tuesday, Utah Sen. Orrin Hatch wrote a letter to Transportation Secretary Mary E. Peters, urging the department to find a replacement airline for Mesa that would provide better service to Moab, Vernal and Cedar City.

Hatch said he has heard from "numerous" people upset by canceled and delayed flights, lost luggage and poor customer service.

Passenger numbers at the Cedar City airport have dropped about 30 percent in the past year because of inadequate service, Hatch wrote.

Hatch spokeswoman Heather Barney said Mesa hasn't explained its decision to the senator.

Mesa Air Group wants to back out of its agreement to provide service to Moab, Cedar City and Vernal.

The airline has notified the U.S. Department of Transportation that its Air Midwest unit plans to stop flying to the three Utah cities on Aug. 19, several months before its agreement to provide government-subsidized service is set to expire.

Bill Mosley, a Transportation Department spokesman, said Mesa cannot pull its service until a replacement is found.

Mesa did not provide a reason for its decision in notices it sent to the department earlier this month, and officials with the fast-growing airline were unavailable for comment Wednesday. The airline is not required to say why it wants to drop service, only to give a 90-day notice.

"This is a big deal. We've spent a lot of time, a lot of effort and a lot of money to bring our airport up to standard for 19-passenger airplanes, and then to have them drop us like that is taking our breath away," Bill Groff, chairman of Moab's airport board, said Wednesday.

In March 2006, Mesa received a 24-month essential air service contract from the government to provide subsidized service to Moab and Vernal. The airline won a similar contract in January 2006 to provide service to Cedar City.

The federal essential air service program pays airlines to fly into small airports that they would normally bypass because of high costs or low passenger numbers. The program began in 1978 to ensure that isolated communities would continue to be served after the airline industry was deregulated.

Mesa's agreement with the government obligates it to provide 12 round-trip flights per week between Moab and Salt Lake City International Airport. In return, it is entitled to receive a subsidy of as much as $1.3 million if annual revenues fall short of expenses.

The airline promised to fly 12 round-trip flights a week between Vernal and Salt Lake. It is entitled to a $562,720 subsidy to offset expenses.

Mesa was awarded an annual subsidy of $897,535 for providing 12 nonstop flights a week between Cedar City and Las Vegas and four nonstop flights between Cedar City and Phoenix. The agreement was later changed to permit Mesa to fly 12 nonstop trips from Cedar City to Salt Lake and five nonstops from Cedar City to Phoenix at the same subsidy level.

Mesa has been expanding rapidly. In December, it signed an agreement with Shenzhen Airlines to create a new regional airline in China. Mesa is also aggressively recruiting pilots and other skilled workers. The company is offering bonuses of up to $5,000 for qualified mechanics and $10,000 bonuses to dispatchers.

On the other hand, the carrier was hit with a $24 million loss in its second quarter ended March 31. It earned a profit of $5.3 million in the same period of last year.

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