Delta Terminates PNCL Contract

The six-month-old Delta capacity purchase agreement with Pinnacle is being cancelled, according to the regional airline which said the move would become effective July 31. Pinnacle called the Delta action a wrongful termination. "We believe that the attempt by Delta to terminate this contract is wrongful, and we intend to pursue appropriate remedies," Pinnacle Airlines Inc CEO Phil Trenary said, adding the issue will have no immediate effect on schedules, routes or staffing. "At this time, it remains business as usual for our passengers and our people.”
Delta cited the same reason – operational performance – it cited when it notified Mesa that it was cancelling Freedom’s 50-seat flying recently and charged Pinnacle did not meet minimum arrival-time performance requirements for a period since flights began late last year. Mesa won a temporary injunction against the termination in an Atlanta court and said if the injunction had not been granted it would have filed for Chapter 11 bankruptcy protection about July 20. Mesa contends that the failure to reach Freedom’s completion rate was because of Delta’s own requests to remove the flights. The Mesa action is the subject of a lawsuit against the major carrier. Related Story
Pinnacle CEO Phil Trenary noted that many factors affecting on-time performance are beyond Pinnacle's control, chief among which is the fact the operational schedule created by Delta. Regionals have been complaining that the schedules sent down by Delta are often unrealistic but a recent article on Atlantic Southeast indicated that, at ASA at least, the situation has changed. Related Story  The move seems to put into question recent statements that Delta Connection Senior Vice President Don Bornhorst is bringing Delta Connections closer together.
"We are extremely surprised and disappointed that Delta is attempting to take this drastic and improper action," said Trenary. "From the very beginning of our Delta Connection operations, we expressed our concern that the flight schedules Delta created were unrealistic. Our position was affirmed when recent schedule changes by Delta allowed immediate improvement in our on-time performance, well above the agreed minimum standard and above most other Delta Connection carriers."
Under the capacity purchase agreement, Delta is required to collaborate with Pinnacle to create a mutually acceptable operating schedule. Delta has created Pinnacle's operational schedule since the beginning of operations in December 2007.
Pinnacle entered into a new capacity purchase agreement with Delta in April 2007 to operate 16 CRJ-900 aircraft as a Delta Connection carrier and began operations under the agreement in December. Pinnacle has currently taken delivery of nine of the 16 CRJ-900 aircraft on order.