When federal regulations on turboprops became more strict, it quadrupled Mesa Air's pilot-training costs. Something has to happen. The company already has trimmed the number of turboprops from 118. Meanwhile, the contract to add more jets to the fleet will beef up local operations. It may mean building a pilot training facility in Mesa at Williams Gateway Airport that would create between 2,000 and 3,000 jobs, Ornstein says.
More growth is anticipated as major airlines expand regional jet operations.
About 60 percent of Mesa Air's income comes through contracts with major carriers, in which the company is paid a set fee per flight. Its revenue is not affected by fuel prices or fluctuations in airline travel. Mesa Air's contract business is anticipated to increase to 70 percent by 2002 and to 80 percent by 2004, according to a Goldman Sachs report issued in March. Increased contracts may come through new business with other carriers, Ornstein said. It also could result from America West's aggressive plan to expand its regional jet service, increasing its frequency to larger markets and creating direct service to smaller markets.