Pilots flying for two American Airlines-owned regional carriers will enjoy massive pay rises after senior management moved to stem resignations. Maryland-based Piedmont Airlines and Texas-based Envoy Air are increasing pilot pay, in some cases by almost 90%, to keep existing pilots loyal and attract new recruits.

Big pay rises for Envoy Air pilots

Envoy Air operates more than 150 Embraer jets on American Airlines regional routes. According to a CNBC report, Envoy employs around 2,000 pilots and loses roughly 80 pilots a year to other carriers while recruiting about 60 new pilots annually - so their pilot pool is steadily shrinking. In particularly strong demand are Envoy Air Captains.

"We're pleased to announce a new agreement with Air Line Pilots Association (ALPA), which includes industry-leading pilot pay rates, a pilot supply premium through August 2024, and contract term through July 2029," says an Envoy Air media statement. "With this agreement, pilot pay rates increase to be higher than other non-American Airlines Group regional carriers, by 6% for Envoy First Officers and 10% for Envoy Captains.

Additionally, from the effective date through August 31, 2024, Envoy pilots will receive a pilot supply premium of 50% added to their hourly rate for all compensable hours."

Envoy calls the deal a "transformative" approach to pilot pay and says it makes their pilots the highest paid in the US regional airline industry and across national, low-cost, ultra-low-cost, and cargo airlines.

A sweet deal for Piedmont pilots

Meanwhile, the Piedmont camp struck a similar deal. That airline is increasing its first-year Captain's pay from US$78 per hour to $146 per hour (an 87% rise) and first-year first officer pay from $51 per hour to $90 per hour (a 76% rise). The increase comes outside of the contract amendable date and includes a contract extension from 2024 to 2029.

Piedmont Airlines is a smaller operation than Envoy. Piedmont flies around 50 Embraer ERJ 145 jets on American Airlines regional routes. CEO Eric Morgan told CNBC he was losing approximately 25 pilots a month to AA mainline operations and could not hire enough replacements to cover them. Consequently, Piedmont Airlines has grounded ten Embraers simply because they don't have the workforce to fly them.

"Piedmont has made significant investments in recent years to recruit and train the best pilots in the industry, including the bonuses we've previously announced," said Mr Morgan. "We want to grow this airline, and we need pilots to do that. This deal will attract new first officers and the experienced captains we need for future opportunities while also taking really good care of the pilots already flying for Piedmont."

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Pilot shortages hit regional airlines hard

Pilots shortages aren't an exclusively US phenomenon, but most industry analysts agree the US carriers let too many pilots walk during the pandemic. Now, as the big carriers like American Airlines find themselves short-staffed, pilots employed at regional airlines are attractive candidates. It goes some way to solving the pilot shortage problem for the big airlines, but it causes all sorts of headaches for the smaller carriers.

"Piedmont pilot wages will be 50-70% higher (57% on average) than the next highest-paid regional carrier, Endeavor. Including all bonuses, a new hire pilot should expect to make 31% more than pilots at Endeavor and 10% more than pilots at leading ultra-low-cost carriers over the first five years," says a statement issued by Piedmont Airlines. "Piedmont expects to hire more than 400 pilots in 2022, with emphasis on experienced captains who can train directly into the left seat. Pilots with captain experience can come to Piedmont and expect to make upwards of $150 an hour immediately."

Source: CNBC