American Airlines Looking To Spin Off American Eagle

American Airlines is planning to spin off its American Eagle regional carrier later this year in an effort to cut costs. There’s a possibility that this divestiture could actually end up offering more options to consumers who travel to destinations served by these smaller airlines.

After its arrangement with American is done, Eagle would have to make deals with the other major airlines to operate flights on their regional routes, competing with existing smaller carriers like Republic and SkyWest. Eagle’s president says the company has already had preliminary chats with the majors and that the big carriers are “intrigued” at what an independent Eagle would bring to the table.

We already have a pretty well-defined network,” he tells the Wall Street Journal, citing the carrier’s existing routes to Latin America and the Caribbean. “We have high confidence that we can grow.”

American, which says it still might sell Eagle, would retain some of Eagle’s services for upward of nine years after a divestiture occurs. Over those years, Eagle routes and planes would gradually be made available for rebidding to other major carriers.

AMR to Spin Off Regional Carrier [WSJ.com]