The FAA says they plan to move forward with a regulatory crackdown on scheduled charters like JSX, at the behest of competitors American Airlines and Southwest Airlines, along with the Air Line Pilots Association. The FAA indicated over the summer that action is being fast-tracked, with plans for a proposed rulemaking published this year and a final rule next year.
American admitted to employees their motive in lobbying to shut down JSX: not wanting to compete.
As CEO Robert Isom put it in a closed meeting, though his comments leaked, “If you don’t have to deal with the same DOT provisions, the same FAA provisions, the same security TSA provisions that’s not fair…. I’m quite certain that the FAA, the DOT, and TSA will take a look at what’s going on and make sure that no one is advantaged..” (Emphasis mine.)
JSX operates from private terminals, while exceeding TSA security requirements (that don’t apply to the nation’s 4.5 million private flights each year). Passengers can show up 20 minutes before their flight, sit in spacious seats and aren’t nickel and the service includes free checked bags, free wifi, along with drinks and snacks. Everything they do conforms to well-established rules, and satisfied the Department of Transportation and TSA until competitors came lobbying.
- I have no particular brief for JSX, but I do detest using the government to shut down competition especially where that competitor is innovating to offer a better product. But something that’s often missed in the debate is the future consequences of regulatory changes.
- It’s one thing to focus on ‘we don’t like a certain business let’s shut it down’ but you have to think about how those rules are going to effect future businesses and innovation. In this case, it means cutting short the potential for inexpensive small city air service, that’s on the cusp of becoming reality.
Years ago economist Pete Boettke pointed out that you don’t get to design the world the way you want it. In aviation, you don’t just get to put a competitor out of business. You’re actually designing a set of rules that are going to determine how commercial aviation works for decades to come.
Boettke argued that he could make a single rule change and make Cindy Crawford the best basketball player in the NBA. All players had to wear high heals. Boettke was wrong… Dennis Rodman would’ve been the best player.
The FAA can require that all part 135 carriers like JSX and Contour have to follow the same rules as part 121. Sure, American, Southwest and ALPA would get their way and shut down competitors. In order to fly from private terminals you’d need to actually have access to private aircraft. JSX couldn’t hire retiring senior captains from American and Southwest – they’d have to use the same pilots as everyone else. But that’s not all it would do.
We spent a tremendous amount on Essential Air Service subsidies. The FAA reauthorization bill more than doubled it. But what if we didn’t need subsidies and could get more and better service?
- Most small rural airports aren’t ever going to be served by the major commercial airlines. 90% of the airports in the country aren’t usable by part 121 carriers but most are open to part 135.
- Even where they can use the airports, it’s not economical for their pilots and planes with just a few passengers on board.
- But new, fuel efficient planes are a few years from market… as long as there remains a market.
JSX has ordered up to 150 19-seat Aura Aero Eras aircraft, pictured, along with up to 82 9-seat Electra sTOLs and up to 100 30-seat Heart Aerspace ES-30s.
There are fully electric and hydroelectic aircraft being developed and with a path to certification. They’re all being designed around existing regulations than markets: 9 seaters (because those can be sold directly by the seat under part 135), 19 seaters (because those are the largest that can operate without a flight attendant), and 30 seaters (because those are the largest that can operate under part 135).
With the potential to operate a couple hundred miles from short runways, a 19-seat plane might work with just 12-15 passengers. That’s a market the major airlines can’t serve. Even through their regionals there’s a push to retire planes certified to operate with 50 seats.
We need part 135 operators because we need smaller, fuel efficient planes if we’re going to achieve rural air service.
Without regulations that support this, demand for these planes dries up. You need small, economical carriers operating out of these airports to support demand for these planes, and then we need these planes to offer efficient air service to smaller towns.
We aren’t just regulating ‘air carriers we don’t like’ (or that major airlines don’t like as competitors) today. We’re creating a regulatory framework within which innovation will occur – or not – for decades to come.
And by the way, this nascent hybrid electric and electric aircraft industry is one that other countries won’t be hobbling. So do we want to develop it here, or fall behind places like China?
Why does EAS exist. It sounds like a waste. Rural America doesn’t travel.
Well said article, Gary !
Sadly, those in charge are pretty much serfs to Big Banks, Big Healthcare, Big Tech and Big Airlines.
Remember who was in charge when we bailed out these guys in 08-09, then rubber-stamped the mergers that gave us The Big Four we have right now.
So, yeah, there’s little doubt they’ll happily help AA snuff out an infant entrant like JSX, a JSX actually bringing some innovation to the market.
Then, in a happy little bout of election year fugazi the same administration will finally “announce” they are looking into the FF program games… an effort certain to be forgotten by mid-November.
It’s all just a big Chinatown.
@ SFO/EWR … Easter Island ( EAS ) exists because it is a Place .
JoeKamalaPeteButt are fine people compared to magaTrump but they are killing JetBlue and JSX. They are helping fAAtcats. They are raising taxes and destroying the economy. They want to raise taxes by 500B, which will hurt the economy. They are little better than Putin, who also wants to hurt America, so sad.
@alert
Easter Island is IPC
Time to shut down JSX
“regulatory crackdown on scheduled charters like JSX”
An airline is either a scheduled airline or a on-demand charter carrier.
It can’t be both.
If AA gets its crony FAA friends to seriously harm or put out of business JSX, then I will never ever pay cash for an AA flight again. I will just use my big pot of AAdvantage miles exclusively for flights; hopefully at a value of 2 cents per mile. If enough retired road warriors do this, it will hurt AA as punishment. Besides you got to spend all those miles before you meet your maker!
Forgive me, what EAS location does JSX serve? Scottsdale, AZ? Taos, NM? Boca Raton, FL?
You may like the product, but let’s not pretend JSX is providing an EAS service.
Let’s take senior FAA senior staff to Houghton, MI and let them figure out how to get to a Part 121 carrier.
When I was in high school there were 8 airports service from North Central Airlines (one of the legacy carriers that is now part of Delta).
Today no part 121 carrier serves the UP, you have to drive to the Lower Peninsula, To Green Bay Wisconsin, or Duluth, MN.
Let them enjoy the up to 6 hour drive to one of the 3 airports, in fact let them do it the morning after a winter story.
This administration doesn’t care about common sense. They do care about unions and will do what the unions ask regardless of whether it’s good for the country
If the major airlines actually offer decent service for what they charge perhaps JSX would not be a threat. The US tax payer has repeatedly bailed out the major airlines while they continue to offer worse and worse service. Of course they are threatened by a startup airline that actually offers good service.
I find it rich that anti government right wingers are happy to lean into government regulation when it serves their interests
@SFO/EWR I politely disagree that “rural America doesn’t travel”. In my hometown in rural Northeast Texas (population 1600) I know of at least three people that are either AA ExPlat or UA 1K. In high growth states like Texas there is a substantial demand for air travel outside the major metro areas. Many out of state transplants and native urbanites have either relocated or have second homes in rural areas. There is talk of a new airport an hour or so north of Dallas. A logical place for JSX to serve.
@Azck1 – the whole point is, we need to look past what the service looks like today and create regulations for the future, we need selling seats on part 135 carriers to support the development of small aircraft that can serve these communities – and probably do so even without subsidy. it’s like tesla’s roadster and model s paving the way for the model 3 and the entire electric car industry.
Crony capitalism at its finest. AA has been pulling this s- since they tried to squash Southwest back in 1972. It didn’t work then and won’t work now.
Just FYI, Delta services Marquette, MI and Escanaba, MI., both are in the UP
“And Kill Electric Aircraft Innovation”
That’s not good. It’s smaller electric aircraft that will pave the way toward larger ones, or at the very least show where the limitations are. I know Norway is very interested in modest sized electric aircraft, to reach remote cities given the rugged terrain.
And it’s likely not good for the small position I recently bought in Archer Aviation stock.
DOT has never been ran worse than under JoeKamalaPeteButt. There is NO reason to be holding back on SkyWest’s Part 135 Scheduled application – its intact, the FAA signed off on it; DOT is only there to make sure it has competent management AND the correct finances.
SkyWest certainly has both.
We will soon find out if JoeKamalaPeteButt want Pualani and Chester to marry – if there’s no decision before Election day, then we’re gonna have to wait for Trump to get re-elected for it to happen.
@doug houseman: Maybe I’m missing something, but it looks like there are multiple airports with Part 121 service in Michigan’s UP — granted, mostly on regional jets to Detroit, Minneapolis, or Chicago. For Houghton, the nearest airport would be just 7 miles away — Houghton County Memorial Airport (CMX) with United Express service to ORD.
Delta also serves Iron Mountain and Sault Ste Marie both in the UP and also Rhinelander Wisconsin in far northern WI.
Thanks for the summary of this issue, which I used for my letter to my senators.
For 135 to serve lesser/rural locales, it needs connectivity to 121 airports. This means they must bus shuttle from the private terminal to the public terminal and go through TSA.
I am not faulting JSX, I am faulting the security and union bureaucracy that the USG has created to stifle innovation and prop up pilot salaries.
More people in the eastern US are demanding better passenger rail because the overhead of flying is becoming uneconomic.
Someone will find a way to bypass the airline hegemony eventually.
@Spuwho – smaller city service isn’t only connecting service, it’s also O/D traffic to larger cities! And sure, shuttle or otherwise for connections isn’t ideal, but it’s much better than no service.
If the regulations don’t actually improve safety, why do we need them? The whole purpose of the FAA is to make flying safer today than it was yesterday. These regulations seem to be more about regulating business model out of business than improving safety.
Have there been any safety issues with this business model? (Not that I am aware of) Do they actually compete with he majors, (yes in many cases). But as you do point out, theis business model could improve and expand service while reducing the need for subsidies to rural areas.
The government will always default to fewer, larger businesses, than to more, smaller businesses. You can’t control those pesky cats and dogs like you can a half-dozen CEOs. We’ve seen this in banks, defense suppliers, and now airlines. Yet decentralization is the one of the features that makes America unique among nations.
Just because the airlines follow Part 121 doesn’t make them safer. JSX looked at what they could do within the existing regulations and created a unique model that mitigates risk better than the one-size-fits-all airlines. If the FAA punishes them for success it’s one more nail in the coffin for American innovation.