One of the few airlines to have posted a profit for the first quarter of 2020, regional SkyWest Airlines could not repeat its near impossible feat. The carrier, which operates codeshare flights for, among others, Delta Air Lines, posted a $26 million loss in its Q2 report.
Q2 could not live up to Q1
SkyWest surprised everyone when it reported a net income of $30 million for the first quarter of 2020. Some services that would normally have been operated by mainline carriers were switched to smaller aircraft to better match the decrease in demand.
However, as US domestic short-haul traffic also suffered greatly in the past few months, the numbers have inevitably turned red also for the St George, Utah-based regional carrier. As such, the airline reported a $26 million loss for Q2. Operating revenues were $350 million, as opposed to $744 million for the same period in 2019.
Fleet replacement acceleration
According to FlightGlobal, SkyWest’s Chief Operations Officer Wade Steele said that the current crisis had accelerated the airline’s fleet replacement program. Currently, it operates a mixed bag of Bombardier CRJ’s (-100s, -700s and -900s) and Embraer ERJ-170s. However, in January, the airline ordered 20 new ERJ-175 jets, and by mid-2022, SkyWest expects to have 213 E175s in its fleet, compared to 156 at the end of last year.
In Q2, the airline took delivery of 21 used E175 as part of an agreement with United. It also accepted three from Delta and received two new ones from the manufacturer.
Meanwhile, fleet replacement does not necessarily equal growth. At the end of the second quarter, SkyWest had 471 aircraft, down from 484 three months prior. Furthermore, it intends to let another 21 aircraft go by the end of the year.
Cautious trend of increased flights
In a non-pandemic quarter, SkyWest would normally operate 2,600 daily flights as part of codeshare agreements with Delta, United, American, and Alaska Airlines. In May, that number was down to 800. It rose slightly in June and July, to 900 and 1,300 respectively. However, the domestic recovery in the US has stalled with new states emerging as virus hotspots, and it is uncertain if that trend will continue in the following months.
Early retirements despite CARES
Although SkyWest received $307 million in payroll grants through the CARES act in the second quarter, about 4,000 of SkyWest’s pre-crisis 14,000 workforce have taken leaves of absence or early retirements. As a result, the company has managed to reduce its daily cash-burn to about $1 million, a number management says will be halved by the end of the year.
Our hearts truly go out to the crew members and staff that have all been a part of making travelers’ dreams come true and are now in danger of losing their jobs as the grim COVID-battered Q2 financial results come in carrier by carrier. To celebrate their, and our, love of flying, let’s end with this video made by SkyWest for World Pilot Day.
To most, the sky is the limit. To us, the sky is home. Thank you to our amazing pilots for keeping us flying this #worldpilotsday. #SkyWestStrong pic.twitter.com/Oz9CEn3Q0m
— SkyWest Airlines (@SkyWestAirlines) April 26, 2020
