Hyannis Air Service, Inc., dba Cape Air Attn: Andrew Bonney, 660 Barnstable Road, Hyannis, MA (508)
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1 Proposal of Hyannis Air Service, Inc. dba Cape Air to provide subsidized Essential Air Service for: Massena, NY To/From Boston via Albany Docket DOT-OST Hyannis Air Service, Inc., dba Cape Air Attn: Andrew Bonney, 660 Barnstable Road, Hyannis, MA (508) October 27, 2014
2 Cape Air is delighted to have served Massena for more than six years Overview Cape Air started serving Massena on September 16, 2008 Massena ribbon cutting Since then we have flown more than 48,000 passengers to or from Massena Cape Air serves Massena three times daily to/from Boston, via Albany Fares are low, in 2014 averaging just $53 net Serving both Massena and Ogdensburg provides critical mass to recover from irregular operations 1
3 Cape Air s service at Massena has brought ridership to a modern high Massena enplanements 6,000 5,000 4,396 5,027 4,854 4,000 3,000 3,201 2,925 3,252 3,350 2,000 2,327 2,056 2,085 1, Source: US DOT T100 and Cape Air FLIFO 2
4 Cape Air OVERVIEW 3
5 Cape Air has grown from a single aircraft and route in 1989 to America s largest commuter airline today Key facts Cape Air: Leading the pack nine at a time First route was Boston Provincetown, begun in October 1989 with one aircraft Today s fleet 76 Cessna 402s in four regions Four Britten-Norman Islanders Two ATR-42s in Micronesia Operating up to 550 flights daily In 2013 flew 728,000 passengers Stable, mature and growing company Photo courtesy Mark Garfinkel (August 7, 2000, Boston) 4
6 Cape Air 2014 Annual revenue of $120M Financially stable 44 airports served, 20 in EAS 83 aircraft Captain Krista Poppe Augusta based 5
7 Havre Glasgow Wolf Point Sidney Glendive Billings Proud to be America s finest commuter airline! Kirksville Quincy St. Louis Massena Ogdensburg Saranac Lake Augusta Bar Harbor Rutland Lebanon Rockland Albany Boston Providence Provincetown Hyannis White Plains Nantucket Manhattan Block Island Martha s Vineyard New Bedford Ft. Leonard Wood Marion Cape Girardeau Owensboro Cape Air Routes October 2014 Denotes seasonal service Micronesia Saipan Guam Rota San Juan St. Thomas Culebra Tortola Virgin Gorda Mayaguez Anguilla Vieques St. Croix Nevis Map inset not to scale
8 One of Cape Air s best features is interline connections with all of the legacy airlines plus JetBlue, giving Massena access to the world 7
9 Itineraries connecting between Cape Air and United are available on united.com 8
10 At joint cities Cape Air s connecting destinations appear on jetblue.com Massena on jetblue.com! 9
11 Through Expedia and other OTAs, Cape Air connects EAS communities with most network airlines 10
12 Over more than 20 years in business Cape Air has invested in the airline features smaller communities need Feature Established Reliability Tickets sold through Expedia, Orbitz, Travelocity Interline e-ticketing with all legacy airlines Checked luggage transfer with all legacy airlines TSA security program 11
13 Cape Air proposes continued service with our fleet of 76 Cessna 402s 12
14 Cape Air takes environmental sustainability seriously by investing in fuel-saving aircraft technologies and powering its offices with solar panels 13
15 Cape Air has its own internal reservations center Cape Air s Reservations Call Center 800-CAPE-AIR (Where there is never a booking fee!) 14
16 Since 2011 Cape Air has operated a ticket office in Massena 15
17 The key to Cape Air s success is our friendly people Daffodil Daffy Day at Cape Air Reservations 16
18 And our mantra: Cape Air celebrates Valentine s Day in the Caribbean Make Our Customers Happy, And Have A Good Time Doing It! 17
19 Air Service For MASSENA 18
20 Marketing Massena s air service is a key part of our job and it s great fun, too!
21 Cape Air is pleased to propose continued service at Massena Economics Year 1 (see note) Drivers Daily RTs 3 Completion rate 97% Pax/Dpt 4.41 Load Factor 49% Fare (net) $53.01 Pax Rev/Dpt $ Fuel $866,537 Maintenance $1,034,800 Pilots $255,058 Ownership $354,443 Stations $492,457 Operating Fees $120,401 Marketing $63,375 General & Admin./Other $272,230 Operating Expense $3,506,415 Return of 5% $184,548 Economic Expense $3,690,963 Passenger Revenue $1,082,190 Profit ($2,608,773) Year 1 Conforming 2-Year Subsidy Required $2,608,773 Per Departure $1,228 Per Passenger $278 4-year option preferred Year 1 4-Year Contract Discount $2,549,293 Per Departure $1,200 Per Passenger $272 Notes: Cape Air prefers a four-year reselection, offered at a discount See note on next slide regarding annual escalation factor 20
22 To align revenue with costs over time Cape Air proposes a 4% annual escalation factor Annual subsidy including escalation Two-year reselection MSS Year 1 $2,608,773 Year 2 $2,713,124 Four-year reselection Year 1 $2,549,293 Year 2 $2,651,265 Year 3 $2,757,315 Year 4 $2,867,608 21
23 Cape Air would be honored to be reselected at Massena! Cape Air offers the airline amenities Massena needs: Proven service that yields record enplanements at Massena High-frequency non-stop service to/from Boston Logan; via Albany Full interline connectivity, allowing same-ticket connections with the world Global distribution Ample fleet of back-up aircraft Robust marketing and downtown ticket office Cape Air: Your Community Wings! 22
24 Thank You! Hyannis Air Service, Inc., dba Cape Air Attn: Andrew Bonney, 660 Barnstable Road, Hyannis, MA (508)
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