Virus shutters small US airlines

3 regionals grounded, more could join them

Some of the nation’s smallest airlines are facing some of the biggest headaches in coping with the travel meltdown.

Three regional airlines have already stopped flying as passengers shun air travel out of fear of the coronavirus. And industry officials worry that other small carriers could fail, leaving smaller cities and towns even more isolated.

“There is an extremely high risk to small community air service right now,” Faye Malarkey Black, CEO of the Regional Airline Association, told USA TODAY in an interview.

Flying under names like United Express and Delta Connection, regional carriers are usually independently owned businesses that affiliate with major airlines to feed passengers into hubs from cities that don’t have enough passengers to merit mainline service.

But because they serve small markets that are less profitable than bigger ones, they are more vulnerable to downturns than the large airlines with which they partner, Black said.

That financial fragility is already playing out.

Trans States Airlines, a United Express carrier, suspended operations in April. It was followed by Compass Airlines, which flew as American Eagle and Delta Connection. Both are owned by Trans States Holdings.

“An airline is made up of people’s lives . ... We’ve all got to survive this.” Richard Leach, president, Trans States Holdings

The Bridgeton, Missouri, company had planned to wind down Trans States Airlines’ operations and funnel its employees into another of its commuter airlines, GoJet Airlines. But when the pandemic struck and passenger volume dried up, it pulled the plug. It also grounded Compass after an effort to find a new partnership fell through in light of the COVID-19 crisis.

“It’s a huge blow,” said Richard Leach, president of Trans States Holdings, in an interview. For nearly 40 years, he said the company was always able to find new opportunities and survive the tumult in the airline industry. But this time, there was no beating the pandemic, which claimed more than 2,000 jobs combined between the two shuttered airlines.

“An airline is made up of people’s lives,” he said, employees for whom he cares a lot. For now, the company is pinning its hopes on GoJet and the new Bombardier CRJ-550 regional jets that are arriving. But he said there is no getting around the headwinds rocking the entire airline industry.

“We’ve all got to survive this,” he said.

The third airline ceasing operations is RavnAir Group, based in Anchorage, Alaska, which filed for Chapter 11 bankruptcy reorganization last month after 90% of its passenger revenue dried up. Between its three separate brands, RavnAir Alaska, PenAir, and RavnAir Connect, the company provided passenger, mail and freight service to more than 100 Alaskan communities, including remote villages.

The company, which bills itself as Alaska’s largest regional carrier and employs more than 1,300 people, said the statewide travel shutdown forced it to park all 72 of its aircraft.

On its website, RavnAir Group CEO Dave Pflieger pleads for public support to lobby the Trump administration to try to save the carrier. He says RavnAir could only receive $5.2 million of the $75 million from the federal relief package for which it had applied because of a formula that favors large, well-capitalized airlines, not small regional carriers.