SkyWest Airlines 2004 Annual Report Download - page 13

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its current fleet that could materially or adversely affect its operations or financial condition, including:
xthe breach by Bombardier, Inc. of the Company’s firm order contracts for the delivery of CRJ700s and CRJ200s or any
change in the delivery schedule of such CRJ700s;
xthe interruption of fleet service as a result of unscheduled or unanticipated maintenance requirements for such aircraft;
xthe issuance of FAA directives restricting or prohibiting the use of EMB120s, CRJ200s or CRJ700s; or,
xthe adverse public perception of an aircraft type as a result of an accident or other adverse publicity.
Unionization of the Company’s employees could impact the Company’s business
The employees of the Company are not currently represented by any union; however, collective bargaining group organization
efforts among the Company’s employees occur from time to time and management expects that such efforts will continue in the
future. In particular, the Company’s management anticipates that unionization efforts may increase if the Company continues to
grow and the number of former union employees employed by the Company increases. If unionizing efforts are successful, the
Company may be subjected to risks of work interruption or stoppage and/or incur additional administrative expenses associated
with union representation. Management recognizes that such efforts will likely continue in the future and may ultimately result in
some or all of the Company’s employees being represented by a union.
The Company is subject to significant governmental regulation
All interstate air carriers, including SkyWest, are subject to regulation by the DOT, the FAA and other governmental agencies.
Regulations promulgated by the DOT primarily relate to economic aspects of air service. The FAA requires operating, air
worthiness and other certificates; approval of personnel who may engage in flight, maintenance or operation activities; record
keeping procedures in accordance with FAA requirements; and FAA approval of flight training and retraining programs. The
Company cannot predict whether it will be able to comply with all present and future laws, rules, regulations and certification
requirements or that the cost of continued compliance will not have a material adverse effect on the Company’s operations.
The occurrence of an aviation accident would negatively impact the Company’s operations and financial condition
An accident or incident involving one of the Company’s aircraft could involve repair or replacement of a damaged aircraft and its
consequential temporary or permanent loss from service, as well as significant potential claims of injured passengers and others.
The Company is required by the DOT to carry liability insurance. In the event of an accident, the Company’s liability insurance
may not be adequate and the Company may be forced to bear substantial losses from the accident. Substantial claims resulting
from an accident in excess of the Company’s related insurance coverage would harm operational and financial results. Moreover,
any aircraft accident or incident, even if fully insured, could cause a public perception that the Company is less safe or reliable
than other airlines.
ITEM 2. PROPERTIES
Flight Equipment
As of December 31, 2004, SkyWest owned or leased the following types of aircraft:
Number of Scheduled Average
Aircraft Flight Cruising Average
Passenger Range Speed Age
Type of Aircraft Owned Leased Capacity (Miles) (MPH) (Years)
------------------ ---------------- ----------------- ------------------ ------------------ ------------------
EMB120s 21 52 30 200 300 9.1
CRJ200s 36 89 50 500 530 2.8
CRJ700s - 12 70 800 530 0.4