Local service carrier

In particular, in contrast to trunk carriers, local service airlines received government subsidies throughout the regulated era.

Essair started feeder service on 1 August 1945 on a route from Houston to Amarillo, Texas via many intermediate points.

[1][16] In the meantime, prompted by the Essair certification, the CAB initiated a case, published July 1944, to consider local air service nationally.

[18] The Board was not confident feeder service could be provided on a cost-efficient basis by the trunks, therefore the CAB decided to certificate new carriers, with the idea they would become specialists in serving small routes efficiently.

The CAB may also not have wanted to risk the progress trunk carriers made in evolving towards subsidy-free operation.

[19] Even before it published its local service findings, the CAB launched a series of cases to certificate new feeder carriers across the contiguous United States.

Each case usually certificated one or more new local service carriers and might also allocate longer routes in the same region to trunks.

[21] A cleanup case re-awarded routes to Southern Airways that the CAB was not confident had been properly awarded previously.

[24] Among successful applicants, All-American Aviation (later Allegheny Airlines, the predecessor to US Airways) was unique because it already had CAB-certification.

The airline ceased operating while preparing for feeder service, was unable to raise funding, and the CAB threatened to revoke its certificate.

Parks Air Lines received routes in three CAB cases, leaving it with a feeder network deemed one of the richest.

The issue was economics; the CAB deemed unacceptable the amount of government subsidy required to keep the airlines operating.

In the case of Mid-West, another subsidiary of Purdue University bought the carrier in 1951, with a plan to substantially upgrade the airline (e.g. moving from single-engined aircraft to Douglas DC-3s).

Wiggins were part of a larger business and the company is still a going concern as of 2024, operating as a feeder cargo carrier for UPS Airlines and Fedex Express since the 1980s.

This was formalized in Part 298 of the Board's economic regulations, which gave blanket authorization for airlines operating an aircraft with a maximum gross takeoff weight of 12,500 lbs or less.

In 1972 the CAB expanded the aircraft size limit to include those of 30 passengers or fewer, with a payload of less than 7,500 lbs.

[30] In 1955, the US Congress forced the CAB to make the certificates of these carriers permanent (Public Law 38, enacted May 19, 1955 amending the Civil Aeronautics Act of 1938).

[31] This was done against the wishes of the CAB; it had made "elaborate promises" to the trunks that local service carriers would never be able to "come into full competitive status".

Prior to permanent certificates, the uncertainty of their regulatory status made it impossible for local service carriers to borrow on a long-term basis.

In permitting local service carriers to enter some trunk routes, the CAB was motivated in significant part by a desire reduce government subsidy paid to local service carriers, a process known as “route strengthening.”[38] The first time a local service carrier went head-to-head with a trunk was in 1957, when the CAB allowed Mohawk to compete with American Airlines on the Syracuse-New York City route.

[40] And in 1955, the CAB permitted a trunk airline to buy a local service carrier, when Continental Air Lines bought Pioneer.

These routes were previously flown by Northeast Airlines, a small trunk carrier that Delta Air Lines bought in 1972.