Midwest Hires SkyWest for New Regional Jet Service

MILWAUKEE - Midwest Airlines Inc. said today it is contracting with SkyWest Airlines Inc. to operate a new 50-seat regional jet service that will launch in April - a move that will be key to Midwest's strategy to fend off an unwanted takeover bid from AirTran Airways.

SkyWest will operate 15 to 25 Canadair regional jets for Midwest during the five-year term of the agreement. The jets will fly under the name of Midwest Connect, the regional carrier for Midwest Airlines. Both Midwest Airlines and Midwest Connect are part of Oak Creek, Wis.-based Midwest Air Group Inc.

The SkyWest service will allow Midwest to add new destinations, increase frequency on existing routes and upgrade several regional routes to all-jet service, said a Midwest Airlines statement. St. George, Utah-based SkyWest will provide aircraft, flight crews and maintenance services for the 50-seat aircraft, while Midwest Airlines will oversee route planning, scheduling, marketing and sales for the new flights.

Midwest Airlines' wholly owned subsidiary, Skyway Airlines, also operates under the Midwest Connect brand. Skyway will continue to operate its fleet of 12 Fairchild regional jets, which each have 32 seats, and eight Beech turboprop aircraft, which have 19 seats each.

The new contract means that Skyway's unionized pilots will not be getting additional work through the expanded service. Capt. Brian Belmonti, chief of the pilots union at Skyway, has criticized plans for outsourcing that work. The Air Line Pilots Association represents around 225 pilots at Skyway.

"We chose SkyWest because of their experience, their excellent record of operational performance, and a commitment to customer service that mirrors that of Midwest," said Scott Dickson, Midwest Airlines senior vice president and chief marketing officer, in a statement. Outsourcing the work to SkyWest also is a less expensive and faster way to launch the service, Carol Skornicka, Midwest senior vice president of corporate affairs, said last week.

The new regional jet program is a key part of Midwest's plans to grow its passenger capacity by 10 percent annually over the next three years.

That growth plan has a "significantly higher" value than the $290 million takeover offer for Midwest Air Group, said Timothy Hoeksema, chairman, chief executive officer and president. Hoeksema's comments came earlier this week when he met with local reporters about the hostile takeover bid from AirTran Holdings Inc., corporate parent of AirTran Airways. That growth plan was in the works long before AirTran made its bid, Skornicka said.

Specific routes for the new regional jet service, which will operate from Midwest's Milwaukee and Kansas City bases, will be announced at a later date. Detailed terms of the agreement with SkyWest were not disclosed.

The Midwest growth plan will result in an 8 percent job increase in 2007, not including staffing associated with the new regional jet program, Midwest said. In addition, two more MD-80 series aircraft and one more Fairchild regional jet are expected to go into service in the first half of 2007.

Also, in response to customer requests, Midwest said it will reconfigure its Saver Service operations, which feature two-by-three seating on flights to vacation destinations, to add several rows of the airline's wider, two-across Signature Service seating.

The new seating option on the Saver Service is intended to further differentiate Midwest's product in the marketplace, Dickson said. That differentiation has been cited by Hoeksema as a key strategy in Midwest's drive to remain independent.

The changes amount to Midwest's "most aggressive route expansion in recent years," Dickson said. He said at least six new destinations and as many as 12 new routes will be added from Milwaukee and Kansas City.

(c) 2006, Milwaukee Journal Sentinel.

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