Phoenix-based Mesa Air Group is charting a new course towards financial stability, renegotiating terms with United Airlines and slimming down its fleet to lighten a hefty debt load, the company has negotiated a higher rate for its flights under United branding, which could mean an extra $63.5 million in revenue over the next year, said Mesa Air CEO Jonathan Ornstein in a Jan. 19 conference call with analysts, according to Phoenix Business Journal.
Mesa, once also a carrier for American Airlines, halted its contract in April 2023, leading to unanticipated financial results it has since been in the process of liquidating parts of its fleet, selling off 14 aircraft and associated engines which helped reduce its towering debt from $701.3 million to $539.7 million as of September 2023 indicating in the same breath that the strategy has been productive but acknowledging, "We're not out of the woods" as Ornstein told analysts.
In a move reflecting a longer-term vision, both Mesa Air and United Airlines have shown interest in the burgeoning electric aviation sector with plans to purchase a combined 200 electric aircraft from Heart Aerospace; a part of a larger commitment to reducing the aviation industry's carbon footprint, as detailed by Axios. This comes amidst a wave of investments in alternative fuel technologies that could revolutionize air travel and help achieve net zero carbon emissions by 2050 an ambition in the Decarb America Research Initiative report.
While the sector buzzes with potential, the actual implementation of electric planes is still up in the air, companies like United have also backed other electric flight startups like Archer, and competitors are not far behind with American Airlines and Virgin Atlantic placing their bets on the U.k.-based Vertical Aerospace.
