Mesa Air's hot-headed CEO

Jonathan Ornstein, in the view of a business associate and friend, is `loud, volatile, insulting'

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January 25, 2007|By New York Times News Service

PHOENIX -- On a one-to-10 scale, 10 being the most volatile personality, Jonathan G. Ornstein, chief executive of Mesa Air Group Inc., cheerfully admitted, "I used to be an 11."

Ornstein, 49, will not hazard a guess as to his current level of hot-headedness, but some in the airline business say he still rates double-digits. "I don't know that I've ever hung up on anyone in my life - except Jonathan," said Scott Kirby, president of US Airways, which employs Mesa to fly smaller planes on shorter routes and is the regional airline's biggest customer.

Kirby said he had handled the Mesa relationship for nearly a decade "frankly because I was the only person who could deal with Jonathan at times. He's loud, volatile, insulting, doesn't listen to the other perspective."

College dropout, stock market junkie, motorcycle enthusiast and, on occasion, an uninhibited dancer to hip-hop music, Ornstein is a throwback to an era when airlines tended to resemble the personalities of their chief executives.

And if his personality is outsize, so are Mesa's ambitions. He wants to make the regional airline global. Last month, Mesa said it had formed a joint venture to start a regional airline in China, with plans to have 20 jets in service in time for the Beijing Olympic Games in 2008. In June, Mesa began flying among the islands of Hawaii with a new subsidiary, Go, sparking a price war there.

Yet for all his grand plans, Ornstein's core business is relentlessly detail driven - keeping 200 small planes on schedule for 1,300 daily flights and keeping costs low enough to hang on to the likes of US Airways as a customer.

Regional airlines have grown rapidly since 2000, faster than low-fare carriers such as JetBlue. That has happened as big network carriers like US Airways, United Airlines, Delta Air Lines and Northwest Airlines jettisoned many of their airplanes in bankruptcy and turned to smaller jet operators to fly less popular routes.

Now, however, that shift has slowed and the big airlines are trying to pay the regional carriers less. Pay scales are low at airlines such as Mesa, but the rapid growth has helped buy labor peace, as first officers move quickly to captain. When growth stalls, as it has recently, pilots and others can become frustrated and demand better pay and benefits.

Ornstein, prone to rants against organized labor, is currently locked in a dispute with the Air Line Pilots Association, which represents Mesa's 1,800 pilots. The union sued Mesa to force the airline to stop changing pilot schedules, which the union said ran roughshod over seniority rights, to hold down costs.

The union leaders became so angry that in November they issued a no-confidence statement regarding Ornstein. He called the moves posturing in advance of contract negotiations that start later this year. "They sort of have a script," he said.

Either way, Mesa can be a hard place to work, particularly in proximity to Ornstein.

Stacy Heath, employee relations and events manager at Mesa, was until recently Ornstein's administrative assistant. Her tasks included tracking his mood and warning executives away from a meeting with the boss. "They would call and say, `Is he in a good mood?' I used to laugh, but I do it now, too."

Ornstein worries that he has become too risk averse. Without naming the target company, he said he recently decided against a takeover of another airline in part because of a losing and brutal battle Mesa made for Atlantic Coast Airlines in 2003. "It slowed me down," he said.

And after hopping around earlier in his career - he left Mesa to run Continental Airlines' regional operation, then went on to start Virgin Express, a low-cost European airline, for Richard Branson, then came back to Mesa - "I think I'm done moving around," Ornstein said.

China, in addition to being a huge growth opportunity, gives Mesa a place to send its planes should it lose business with bigger airlines in coming years. And the ability to shift planes abroad also gives Ornstein more bargaining leverage with the pilots union - ask for too much and the planes you're flying disappear.

But by keeping Mesa's costs low, Ornstein hopes to pick up business as Northwest and Delta decide whether to replace older jets such as DC-9s and MD-80s, or turn over some routes to regional airlines.

While being confrontational with unions, Ornstein goes to great lengths to be in direct contact with Mesa employees and to curry their favor. Mesa's holiday party, for some 1,300 workers and spouses, was at a Phoenix nightclub, replete with door prizes and go-go dancers. Mesa throws a similar bash for East Coast workers and a Phoenix water-park party in the summer.

He also runs a perfect-attendance contest, a drawing that awards one worker a free car every year. And he encourages all employees to e-mail him directly and said he answered all messages.

He receives management advice, often from pilots. "Sometimes the best way to streamline financially is to spend some money," wrote one. "Expand personnel, so that everyone isn't bogged down so much."

Another pilot warned Ornstein about a chart posted in the Dulles International Airport break room for Mesa pilots that made the airline's pay look poor compared to SkyWest, a competitor. "Doesn't help morale," the pilot said.

"I find out about a lot of things I wouldn't normally know about," Ornstein said.

Despite rankling many, Ornstein also forms strong friendships. Kirby, the US Airways president, said, "We can literally have a screaming match where one of us can hang up on each other and then play golf together."

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