Air Transport World

Pilgrim looks ahead after merger.

Groton/New Haven--Airline mergers are never easy and Pilgrim Airlines' absorption of NewAir in February is no exception. But the gain has been worth the pain, says Pilgrim's Chairman and CEO, Joseph M. Fugere.

The gain has been in the elimination of a competitor, the acquisition of aircraft slots and the beefing up of the airline's route structure. The pain, aside from cuts in management staff, has been mainly in the inheritance of aircraft leases, some of which, in Fugere's words, "were pretty bad," and the condition of NewAir's planes, which, again in Fugere's words, "needed a lot of work."

But digesting the merger is not Pilgrim's main worry. "The biggest problem in our industry today is the loss of pilots," says Fugere. With renewed hiring by the big airlines luring experienced pilots to higher-paying jobs, the smaller airlines have been suffering a hemorrhage in the cockpit, he says.

In the merger Pilgrim acquired the assets and liabilities of NewAir's money-losing scheduled airline operation in return for 20% of the capital stock of the combined company. (For the 12 months ended September 30,1983, NewAir had a net loss of $214,000 on operating revenues of $5.5 million, with close to 80% of the loss coming in the last three months.) NewAir retained its profitable fixed base operation at Tweed-New Haven Airport and an Embraer Bandeirante to be used for air taxi service. …

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