After Buying Half of ExpressJet in 2019, United Airlines Is Killing It in 2020

In late 2018, United Airlines (NASDAQ: UAL) announced that it would buy 49.9% of regional airline ExpressJet from SkyWest, through a new joint venture called ManaAir. The $70 million deal closed in early 2019.

At the time, buying a major stake in ExpressJet seemed like a reasonable strategic move to give United more negotiating power vis-a-vis the third-party regional airlines that operate most of the United Express fleet. However, the COVID-19 pandemic changed that in an instant. As a result, United Airlines recently confirmed that it will wind down its contract with ExpressJet by the end of this year, which will almost certainly lead to the latter's demise.

At the beginning of 2020, United Airlines had contracts with eight separate regional airlines to operate parts of its United Express regional network. Several of those airlines also operated multiple different aircraft types for United.

Continue reading


Source Fool.com