Delta aims to end flight agreement with Mesa

Delta Air Lines Inc. wants to end a flight agreement with Mesa Air Group Inc. that covers almost one-fifth of Mesa's fleet.

Delta intends to terminate a contract under which Mesa's Freedom Airlines unit flies ERJ-145 aircraft for the larger carrier, Mesa said in a statement late Tuesday that called the notice "a total surprise." Mesa said it would challenge Delta's assertion that Freedom failed to meet required completion rates.

That contract involves 19 percent of Mesa's aircraft and won't be easily replaced, Standard & Poor's equity analyst Jim Corridore said Thursday in a note.

Betsy Talton, a spokeswoman for Atlanta-based Delta, said Wednesday that the company expects the operational changes resulting from the contract termination to take several months to complete. "It will have minimal, if any, impact to customers."

The contract covers 34 Embraer 50-seat aircraft, Talton said. The dispute doesn't affect Delta's other agreement with Mesa for flights by as many as 14 76-seat CRJ-900 aircraft.

Mesa's general counsel, Brian Gillman, declined to comment further on its relationship with Delta.

Mesa operates 182 planes for larger carriers including Delta, US Airways Group Inc. and UAL Corp.'s United Airlines. Mesa has delayed filing financial reports and is fighting legal damages and fees related to a dispute with Hawaiian Airlines Inc. over misuse of confidential information. The Phoenix-based company's shares have declined 70 percent in the past 12 months.