Pinnacle Airlines Corp. announced today that it has entered into a new capacity purchase agreement with Delta Air Lines to operate 16 CRJ-900 aircraft as a Delta Connection carrier. Pinnacle currently expects that the aircraft will be operated by its wholly owned regional jet subsidiary, Pinnacle Airlines, Inc.Under the agreement, Pinnacle will directly acquire and finance the aircraft. Pinnacle will take delivery of the aircraft between November 2007 and July 2008, with scheduled service as a Delta Connection carrier beginning in December 2007. The term of the agreement is for ten years.
The “capacity purchase agreement” sounds similar to that described in another article. The fact that the capacity has been sold in advance reduces Pinnacle’s risk.
Furthermore, the deal almost exactly offsets the number of aircraft the company failed to get from Northwest due to the breakdown in pilot negotiations. Within a week, what looked like a modest setback is now at least a break-even.