New airline coming to Texas

[editor]

Some people may be familiar with ExpressJet because for years it has been working closely with Continental Airlines. Well, ExpressJet is finally going out on its own as an independent airline. Here are its cities:

Albuquerque

Austin

Bakersfield

Boise

Colorado Springs

Corpus Christi

El Paso

Fresno

Spokane

Kansas City

Monterrey

Oklahoma City

Omaha

Ontario (home base)

San Diego

San Antonio

Sacramento

Tulsa

Tucson

Nice that it's going to serve four Texas cities. Unfortunately, not Houston. Maybe because of Continental's presence.

http://www.xjet.com/

[Trae]

Not a loss for the Houston market here. ExpressJet is a low-cost carrier.

[Houston19514]

Some people may be familiar with ExpressJet because for years it has been working closely with Continental Airlines. Well, ExpressJet is finally going out on its own as an independent airline. Here are its cities:

Albuquerque

Austin

Bakersfield

Boise

Colorado Springs

Corpus Christi

El Paso

Fresno

Spokane

Kansas City

Monterrey

Oklahoma City

Omaha

Ontario (home base)

San Diego

San Antonio

Sacramento

Tulsa

Tucson

Nice that it's going to serve four Texas cities. Unfortunately, not Houston. Maybe because of Continental's presence.

http://www.xjet.com/

Under its contract with Continental, ExpressJet is not allowed to serve Houston except in its Continental Express operation.

[houstonfella]

I think it is a Houston company. Good. Hope they do well.

[MiDTOWNeR]

Not a loss for the Houston market here. ExpressJet is a low-cost carrier.

Everyone is a low-cost carrier these days.

[houstonfella]

I have never found that flying was "low cost" but I guess if that's what the sign says.

[KinkaidAlum]

Express Jet is based downtown at the Continental Center. It is a Houston based company with THOUSANDS of employees. They lost a bidding war to continue being Continental's lone regional carrier. However, Continental wasn't smart with their negotiations and they will be hurt.

ExpressJet took 69 jets away from Continental. Most were the ERJ-extended range aircrafts that allowed Continental to serve smaller markets that were far away (Bakersfield, Palm Springs, Pittsburgh, Boise, etc...). Continental made an error in not dictating what aircraft ExpressJet could remove and ExpressJet took 69 of the newest and best embraers!

Now, Continental is scrambling. Their new carrier to help with the regional flying only brought in 44 aircraft to replace the 69 and over half of those 44 are CRJs which are not nearly as comfortable nor can they fly as far. As a result, IAH will lose out. Boise service was already dropped. Just recently, it was announced that Palm Springs will become seasonal (it's been year round service for over 3 years), and Bakersfield (an important oil city connection to Houston) will lose its 3 daily flights this summer. Look for more cuts to come. Summer service to the Colorado cities like Montrose and Gunnison haven't been uploaded into the system yet meaning it is likely they wont return this year.

[ssullivan]

I have never found that flying was "low cost" but I guess if that's what the sign says.

"Low cost" in the airline industry doesn't necessarily refer to what passengers pay. It often refers to the airline's internal cost structure. Just because an airline calls itself "low cost" doesn't mean it's a true discount carrier.

[ssullivan]

ExpressJet took 69 jets away from Continental. Most were the ERJ-extended range aircrafts that allowed Continental to serve smaller markets that were far away (Bakersfield, Palm Springs, Pittsburgh, Boise, etc...). Continental made an error in not dictating what aircraft ExpressJet could remove and ExpressJet took 69 of the newest and best embraers!

Actually, based on a contact I have in upper management at Continental, Continental did have some influence over which 69 aircraft were pulled from service with Continental Express. Some of those routes mainly existed because they had more ERJs in the fleet than they needed, and the flights were operating in a perpetual state of loss. Boise was a good example of this. The attempt to get ExpressJet to lower the operating margin it had on some routes was more of an attempt to match the revenues on those flights to the expense of operating them. Of course the deal didn't work, and now those 69 planes are no longer flying for Continental Express, and some IAH routes are being changed as a result.

The interesting thing is that those 69 ERJs still belong to Continental, who had sub-leased them to ExpressJet to operate them as Continental Express. Under the new agreement, ExpressJet actually has to pay Continental more to operate those planes since they are not flying for Continental Express. So in an indirect manner, Continental will actually benefit from the independent ExpressJet flights.

Long term, I would look for routes like IAH-PSP and IAH-BFL to return year-round. Starting next year when Continental starts taking delivery of new 737-900ERs and more 737-800s, there is a planned trickle-down effect that will cause some routes that have had ERJ-145/ERJ-145XR service to get 737-500 service. That will allow some of the remaining ERJ-145/ERJ-145XR fleet to be reallocated to new routes. In the end, I think it will all balance out. For several years Continental has had too few large 737s, and too many ERJs. The reduction of the Continental Express fleet is part of the plan to better allocate the fleet based on demand, and stop some of the flying that was being done not to make money, but to just keep the planes from sitting idle.