Mesa Air Points to Maintenance Woes and Spare Parts Shortage for Operational Issues

Photo credit: Mesa Airlines operates regional flights for American and United. Flickr / ERIC SALARD

Regional carrier Mesa Air Group struggled to meet the summer surge in travel demand in the U.S., thanks to supply-chain shortages and maintenance delays, affecting the flights it operated for American Airlines.

The maintenance bottleneck was the primary cause of Mesa’s operational woes during the summer, leaving it with fewer spare aircraft in its fleet and ill prepared to handle disruptions caused by summer weather, CEO Jonathan Ornstein said during the company’s most recent quarterly call on August 9. Unlike other airlines that are facing staffing problems, Mesa has enough flight attendants on its roster and more than 250 pilots in its training pipeline.

“I mean our flight attendant numbers have been really good, [and] our pilot situation, especially on the American side is healthy, so the weather impact to us, yes, it causes all those related issues on crews timing out and all of that issue,” Chief Operating Officer Bradford Rich said. “Our primary issue has been that when we have the weather-related operational interruption, the inability to reset the system with adequate spare ratio has really been the core of our problem.”

Mesa, like most airlines in the U.S., deferred maintenance during the early days of the pandemic to save cash. But that bill has now come due, and aircraft — particularly the fleet of CRJ900s that it operates for American, which are getting cabin refurbishments — are undergoing heavy-maintenance C-checks that take twice as long as they did before the pandemic. The regional carrier said in anticipation of this, it lined up additional maintenance providers. But the crux of the problem is those providers have been unable to source enough spare parts.

Airlines are not alone in facing supply-chain woes. Ford and General Motors have had to shut down factories for lack of auto parts and semiconductors. Much of this is due to a global maritime freight slowdown. Ports in the U.S. are backed up, shipping companies are having difficulty sourcing containers, and ports in China and other parts of Asia have been subject to rolling closures due to Covid-19 outbreaks.

Mesa expects these supply-chain constraints to last through the third quarter of 2022.

Despite these issues, Mesa had a good quarter and expects the strength to continue through the third quarter, despite the spread of the Delta variant of the coronavirus. It plans to operate 88 percent of its pre-pandemic capacity for United in the September quarter, and more than 100 percent of its pre-pandemic capacity for American.

The carrier also made news right after the end of the quarter with its investment in Heart Aviation to provide up to 100 electric 19-seat regional jets, expected to join the fleet in 2026. This followed its investment, also with United, earlier this year for Archer Aviation‘s eVTOL aircraft. Ornstein touted the Heart deal’s potential to reconnect smaller cities — like Mesa’s former headquarters in Farmington, N.M. — to the national air transportation system. “We’ll also be able to fly once again to the dozens of cities that we have previously flown to that currently have little or no service,” he said. “We do think that there is a big future in electric and other forms of decarbonization.”

Mesa’s cargo operation with DHL also is ramping up. The regional is in the process of adding a third Boeing 737-400 freighter to its fleet, but says that aircraft is “limited.” For future cargo growth, Mesa likely will add 737-800 freighters, Ornstein said. But he tempered the optimism he expressed earlier in the pandemic, when Mesa said it could add as many as 10 freighters in the next year. Now, Ornstein believes the passenger side of the business provides more potential, while cargo will continue growing “incrementally.”

The regional’s expansion into Europe through its partnership with Gramercy Associates continues. Mesa is a minority partner in the joint venture, due to European Union restrictions, but it will provide technical and operational advice to Gramercy, Ornstein said. The new business is expected to get off the ground next year and likely will start with an existing Mesa aircraft that has been reconfigured to meet European regulations.

Mesa reported quarterly revenues of $5.8 million, up from $4.9 million last year, generating profits of $4.3 million, or $900,000 more than in 2020. The carrier ended the quarter with 167 aircraft in its fleet, and expects to grow by a net of one aircraft through the third quarter of next year.