A day after Southwest Airlines Co. (NYSE:LUV) announced plans to initiate service in Milwaukee, Midwest Airlines Inc. fired back Thursday with an announcement that will bring bigger planes with better range into the fleet of the city's hometown carrier.
Midwest, which is majority owned by private equity firm TPG Capital, said Thursday
it has revamped its agreement with Republic Airways Holdings Inc. (NASDAQ:RJET) to allow Republic to fly two 100 seat Embraer 190 jets under the Midwest name. The two carriers are already partners, with Republic currently doing the bulk of Midwest's flying using 12 smaller, 76 seat E170 jets.
Midwest CEO Tim Hoeksema in a statement said the revised deal will give his company more flexibility, including the potential to return to the West Coast from Milwaukee. Midwest abandoned service out West from its primary hub last year after announcing plans to scrap most of its existing fleet and contract with Republic.
The announcement is the latest chapter in what is shaping up to be a heated battle in Milwaukee this summer. Midwest in 2007 successfully fended off a hostile bid by AirTran Airways Inc. (NYSE:AAI), ending up with TPG instead, but a combination of a slowing economy and a buildup in Milwaukee by discounter AirTran has Midwest reeling and has left many wondering if the airline can survive.
Thursday's announcement if nothing else shows that Midwest is not going down without a fight. But with discount king Southwest entering the fray later this year, tiny Midwest still has a difficult challenge ahead of it. And two more jets are going to do little to stem talk that
Midwest and AirTran stand a better chance against Southwest united than either do on their own. -
Lou Whiteman
Lou Whiteman is a senior writer covering the automotive, transportation and industrial sectors. Follow him on Twitter @louwhiteman
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