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Monday, May 19, 2008

CommutAir Plans to Double Fleet

In its 32nd year, CommutAir not only moved its operation out of the Northeast to feed Continental at Cleveland, but gained FAA certification for the Bombardier Q200s it is acquiring from Horizon. It also finished up the latest iteration of fitness after gaining foreign lenders. Finally it is spinning off the rest of its Beech 1900 fleet, which, according to President John Sullivan is finding a home in the corporate aircraft market, which pays a premium for the 19-seat turboprop. Its final few 1900s will be sold in the next 45 to 60 days to pay off the remaining debt it has to a hedge fund.
Once it completes the acquisition of the 16 Q200s and the elimination of the 1900s, its fleet will be half what it was a year ago when it flew 32 1900s. Sullivan said the airline’s aim is to double its fleet size over the next two to three years.
Commutair is completely out of the Essential Air Service business after having launched the program just after deregulation, said Sullivan. “Business is a tough teacher,” he said of the program. “First you get the test and the lesson afterwards. Over the years we’ve had nine aircraft types and service with four different majors, most in the north east. We’ve had a lot of afterwards lessons. I’m happy being out of the program and until they change the rules we will not get back into it.”
“It is surprising the amount of interest we’ve had in the three Beech 1900s left to be sold,” he said. “The sale of the fleet coincided with the rapid increase in fuel but we managed to find customers in some pretty odd places including in the corporate world where people with King Aires want more seats. We like the corporate guys because they think our prices are cheap.”
Sullivan indicated he expects some growth opportunities out of Continental’s Cleveland hub where he has a capacity purchase agreement with the network carrier. The agreement has no restrictions on the airline’s ability to gain other clients and Sullivan said his goal is to work with other carriers. “For many years that was not viewed favorably while the majors were having us bid against one another,” he said. “It is only fair we should be able to dance with more than one partner. We need to grow. We’ve brought the fleet size down too close to critical, now we need to get back higher. Our sights are on additional Q200s and, perhaps, Q400s.”
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