Delta, ExpressJet ditch regional pact

NEW YORK Thu Jul 3, 2008 8:37pm BST

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NEW YORK (Reuters) - Delta Air Lines Inc (DAL.N) and ExpressJet Holdings Inc XJT.N said on Thursday they had ended the agreement under which ExpressJet provided Delta with some regional flights.

ExpressJet Delta Connection, chiefly operating out of Los Angeles and Salt Lake City, will cease by September 1, the airlines said.

ExpressJet operates 23 Embraer (EMBR3.SA) ERJ-145 aircraft for Delta, and will keep those aircraft after September 1. Delta said it plans to award a portion of the routes ExpressJet flies to another, unnamed carrier.

"With the losses we were experiencing from our Delta pro-rate flying combined with our ability to return aircraft to the lessor, this termination of service is in the best interest of our company," said Jim Ream, ExpressJet's Chief Executive, in a statement.

Delta, which is pruning its network as fuel hits record highs, is also planning to terminate similar regional flying contracts with Pinnacle Airlines Corp PNCL.O and a unit of Mesa Air Group Inc MESA.O. Both Pinnacle and Mesa are protesting Delta's decision.

(Reporting by Bill Rigby; Editing by Tim Dobbyn)