Reno-Tahoe Airport Authority U.S. DOMESTIC INDUSTRY OVERVIEW FOR FEBRUARY

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1 Inter-Office Memo Reno-Tahoe Airport Authority Date: March 30, 2009 To: Statistics Recipients From: Krys T. Bart, A.A.E., President/CEO Subject: RENO-TAHOE INTERNATIONAL AIRPORT PASSENGER STATISTICS U.S. DOMESTIC INDUSTRY OVERVIEW FOR FEBRUARY Average Load Factor: 75.5% (all RNO carriers) Air Fares: Down 14% vs. same period last year 1 Number of Flights: Down 9.7%* Capacity of Seats: Down 8.1%* Fuel: $44.76 per barrel ending February 2009 * Source: APGDat RNO OVERVIEW FOR FEBRUARY Average Load Factor: 79.8% Total Passengers: Down 25.7% Air Cargo: Down 21.6% Number of Flights: Down 21.8% Capacity of Seats: Down 17.5% RNO AIRPORT SUMMARY RNO airlines reported 300,028 total passengers, a 25.7% decline for the month of February 2009, or 103,791 fewer passengers, the highest decline in any single month at RNO since September The February decline in total passengers also represents the eleventh month in a row where the monthly passenger totals have had a double digit decrease over the same period in the previous year. For comparative purposes, it should be noted that February 2009 had one fewer day than Feburary 2008 (leap year) accounting for 16,000 fewer seats in and out of RNO for that day. The airlines continued to reduce airfares throughout the nation in an effort to fill seats in response to the nation s deepening financial crisis. 1 Domestic leisure fares as reported by Harrell Associates

2 The February 2009 average airline load factor in RNO was a respectable 79.8% with a year-over-year increase of 4.8 points over February However, this increase was largely due to a reduction in capacity in February 2009 of 17 fewer daily flights and 1,658 fewer daily seats as compared to February The industry continues to reduce capacity across the nation in response to the economy and falling demand for air travel. Compounding the softening demand for passenger travel, U.S. airlines saw an overall drop of 21.8% in air cargo shipments in February RNO Air Cargo was also down 21.6% at 7,675,284 pounds, or 3,480.9 metric tons, during the month of February. The continuing downturn in air freight is a result of the struggling world economy and the only response available to airlines to counter the strongly falling demand is to further reduce capacity. The economic downturn in the U.S. has had a sizable negative impact on the U.S. air cargo market throughout the second half of 2008 and during the first two months of However, IATA reported on March 26, 2009, that the U.S. air cargo market may have started stabilize based on three consecutive months holding stable in the -22% to -23% range. RNO TOTAL PASSENGERS In February 2009, a total of 300,028 passengers traveled to and from RNO. This is a decrease of 25.7%, or 103,791 fewer passengers, from the same period last year and the largest year-over-year percentage decline recorded at RNO since the 35% decline seen following the September 11, 2001 terrorist attack. The substantial decrease in February traffic is partially attributed to February 2009 having one fewer day in the month than Feburary 2008 (leap year) which accounted for over 16, 000 fewer seats in and out of RNO. The more significant concern remains that demand for air travel has plummeted as grim economic news continues to pile up. Year to date total passenger count for the first two months of 2009 was 595,855 which is 24.5% lower than the same period RNO TOTAL CARGO A total of 7,675,284 pounds, or 3,480.9 metric tons, was handled at RNO during the month of February for a 21.6% decrease compared to February Contributing to the February decline, DHL completed their plans to cease all domestic operations in the United States and had no operations in February. UPS and Fed-Ex also posted February 2009 losses of 23.4% and 8.3%, respectively, compared to February FedEx is citing significantly slowing demand for its services amid weakening sales and lower consumer spending. UPS states they are in the grip of a financial crisis that is changing lives, closing businesses and shattering economies which translates to a lower demand for shipping.

3 AIRLINE LOAD FACTORS In the month of February, RNO airlines reported a respectable average load factor of 79.8% which is approximately 4.8 points higher than the average load factor in February It should be noted that this increase in load factor is reflective of a reduction of 17 flights per day compared to February Five airlines reported a RNO load factor which was higher than their system-wide load factor. Alaska/Horizon, American, Delta, Skywest and US Airways reported an increase in average load factor compared to their system-wide average. Southwest, United and Allegiant reported RNO load factors lower than their system-wide average for February, although all three improved their RNO load factor performance compared to the past two months with Allegiant gaining significant ground, 24.1 points, over January February 2009 RNO Airline Load Factor and System-Wide Comparison Airline Reno LF System LF Difference Allegiant 79.0% 90.2% Alaska/Horizon 84.2% 67.2% 17.0 US Airways 80.5% 77.2% 3.3 Skywest - Delta Connection 91.6% 74.9% 16.7 United 72.9% 73.2% -0.3 American 80.8% 73.9% 6.9 Delta 89.0% 78.0% 11.0 Southwest 60.5% 69.1% -8.6 AIRLINE MARKET SHARE Increased share realized by Southwest, American and United in February 2009 was due to the reduction of airlines in the RNO market. With the bankruptcy of ExpressJet and Aloha Airlines and the departure of Continental Airlines in 2008, RNO is now served by seven major airlines providing 67 daily departures to 16 airports. This compares with 88 daily departures to 23 destinations in February The departure of the above mentioned airlines constituted a shift of 6.42% in market share. Southwest Airlines had the largest increase in market share in RNO with an increase of 4.78 market share points compared to February United Airlines added a forth RNO-DEN flight February through March and gained 2.06 market share points. Delta s 2.5% decrease in share reflects their seasonal cancellation of the non-stop ATL-RNO flight in February. Alaska/Horizon had a slight decrease at 8.35% share due to their change from 737 aircraft to the smaller Q400 aircraft last year.

4 Febuary 2009 RNO Airline Market Share Airline FEB FEB Change Alaska/Horizon 8.35% 8.73% Allegiant 0.63% 0.56% 0.07 American 10.19% 7.97% 2.22 Delta 2.31% 4.89% Delta Connection 3.64% 2.93% 0.71 Southwest 53.38% 48.6% 4.78 United 13.53% 11.47% 2.06 US Airways 7.04% 7.38% -.34 Non-Scheduled 0.94% 1.04% -0.1 DOMESTIC AND INTERNATIONAL CHARTER PASSENGERS Year-over-year, RNO charter traffic decreased 33% in February 2009 with Allegiant reporting a total of 2,827 charter passengers. This decrease in charter activity is a direct result of a new contract between Harrah s Charter and Allegiant Airlines to reduce longhaul charter flights to and from east coast markets. A total of 23 Harrah s charter flights, each using an MD-80 aircraft with 130 available seats, occurred in February 2009 compared to 27 charter flights in February 2008 and resulted in 1,390 fewer passengers. SCHEDULED DEPARTURES AND SEATS During the month of February, RNO reported 1,904 scheduled departures, or 21.8% fewer departures than February This decrease is part of a nation wide reduction in airline capacity as a direct result of increased fuel costs that peaked at $147 per barrel in July 2008 followed by a sharp decline in the U.S. economy that continues into The RNO total monthly available outbound seats of 234,668 in February 2009 represents a 17.5% decrease year-over-year due to the reduction in daily departures and the downsizing of aircraft. TOTAL OPERATIONS Total RNO airport operations for the month of February declined 28% to 7,498 operations which is 2,922 fewer operations than February This decline is attributed to a decrease in scheduled service and general aviation flying to and from RNO. Total airport operations consists of scheduled air carrier arrivals and departures, air taxi flights, general aviation landings and take-offs, and military aircraft operations. KTB/cf

5 TOTAL PASSENGERS Jan Feb Mar Apr May 475,000 June July Aug Sept Oct 425,000 Nov Dec PASSENGERS 375, , ,000 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC PASSENGERS¹ PASSENGERS¹ Month Percent Change 2009 Percent Change January 395, , % 295, % February 393, , % 300, % March 481, , % 1st Q Total 1,270,334 1,224, % April 406, , % May 421, , % June 458, , % 2nd Q Total 1,285,653 1,128, % July 465, , % August 473, , % September 398, , % 3rd Q Total 1,337,564 1,161, % October 397, , % November 375, , % December 377, , % 4th Q Total 1,150, , % TOTALS 5,044,087 4,434, % 595, % ¹Per Landing Reports % change YTD

6 MONTHLY ENPLANED PASSENGERS PASSENGERS¹ Jan Month DIFFERENCE Feb January 200, , , % Mar February 195, , , % Apr March 240, ,875 May April 207, ,845 June May 209, ,861 July June 229, ,271 Aug July 232, ,791 Sept August 235, ,576 Oct September 202, ,607 Nov October 201, ,339 Dec November 188, ,456 December 183, ,563 TOTALS 2,527,468 2,224, , % ¹Per Landing Reports Monthly Enplaned Passengers 245, ,000 PASSENGERS 205, , , , ,000 January February March April May June July August September October November December

7 MONTHLY DEPLANED PASSENGERS PASSENGERS¹ Month DIFFERENCE Jan January 195, , , % Feb February 197, , , % Mar March 240, ,620 Apr April 198, ,923 May May 211, ,284 June June 228, ,170 July July 233, ,541 Aug August 238, ,426 Sept September 195, ,244 Oct October 195, ,807 Nov November 187, ,800 Dec December 194, ,208 TOTALS 2,517,225 2,210, , % ¹Per Landing Reports - Scheduled and Charter Monthly Deplaned Passengers 245, ,000 PASSENGERS 205, , , , ,000 January February March April May June July August September October November December

8 MONTHLY ENPLANED PASSENGER LOAD FACTOR SUMMARY 100% 95% 90% 85% 80% 75% 70% 65% 60% 55% 50% 45% 40% Monthly Load Factor Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec % 75.70% 81.80% 76.45% 77.46% 82.96% 80.80% 81.90% 75.80% 77.00% 71.10% 69.30% % 75.06% 75.20% 72.51% 72.54% 79.51% 79.86% 79.13% 81.62% 76.59% 70.7% 69.70% % 79.81% ENPLANED PASSENGERS* LOAD FACTOR (%) DIFFERENCE Month (2009 / 2008) January 198, , , February 193, , , March 237, , April 204, , May 206, , June 226, , July 229, , August 232, , September 199, , October 198, , November 184, , December 181, , *** 2,492,087 2,224, , * Per Landing Reports *** AVERAGE OF AIRLINE LOAD FACTORS

9 LOAD FACTOR BY AIRLINE Carrier Seats Available ***Enplaned Passengers 2009 Load Factor (%) 2008 Load Factor (%) Difference Alaska / Horizon 14,980 12, % 79.5% 4.7 Allegiant 1, % 81.2% -2.2 American* 17,100 14, % 80.5% 0.3 Delta 3,750 3, % 87.1% 1.9 Delta Connection 6,153 5, % 89.0% 2.6 Southwest 134,078 81, % 64.7% -4.2 United 28,018 20, % 72.7% 0.2 US Airways 13,078 10, % 73.9% 6.6 AVERAGE** 218, , % 75.1% 4.8 *LOAD FACTORS REPORTED BY AIRLINES ** ENPLANED PASSENGERS DOES NOT INCLUDE CHARTER PASSENGERS Airline Load Factor 100.0% 90.0% 80.0% Average 79.8% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Alaska / Horizon Allegiant American* Delta Delta Connection Southwest United US Airways

10 DAILY ENPLANED SEATS AVAILABLE 12,000 11,500 11,000 10,500 10,000 9,500 9,000 8,500 8,000 7,500 7,000 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC ,130 10,099 10,505 10,332 10,430 10,633 10,633 10,633 10,329 10,122 9,901 10, ,064 10,256 10,153 9,768 9,433 9,645 9,645 9,645 8,804 8, , ,209 8,381

11 TOTAL AIR CARRIER MARKET SHARE Carrier Passengers Alaska Air Group 25, % Allegiant 1, % American 30, % Delta 6, % Delta Connection* 10, % Southwest 160, % United 40, % US Airways 21, % Non-Scheduled 2, % Totals 300, % *Delta Connection carriers: ExpressJet and SkyWest Percentage of Total Alaska Air Group, 8.4% Allegiant, 0.6% American, 10.2% Delta, 2.3% Delta Connection*, 3.6% Non-Scheduled, 0.9% US Airways, 7.0% Southwest, 53.4% United, 13.5%

12 Jan TOTAL PASSENGERS DOMESTIC & INTERNATIONAL DOMESTIC SCHEDULED PASSENGERS Feb Mar Apr 540,000 May June July Aug Sept Oct Nov Dec PASSENGERS 490, , , , , ,000 January February March April May June July August September October November December DOMESTIC CHARTER PASSENGERS 7,500 6,500 5,500 PASSENGERS 4,500 3,500 2,500 1,500 January February March April May June July August September October November December 2009 DOMESTIC¹ INTERNATIONAL¹ 2009 TOTAL 2009 Charter 2008 Charter DIFFERENCE MONTH Scheduled Charter Scheduled Charter Passengers Passengers Passengers Passengers January 294,166 1, ,827 1,661 4, % February 297,201 2, ,028 2,827 4, % March April May June July August September October November December TOTALS 591,367 4, ,855 4,488 8, % ¹Per Landing Reports

13 MONTHLY SCHEDULED DEPARTURES 2,900 2,700 2,500 2,300 2,100 1,900 1,700 1,500 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC ,462 2,239 2,534 2,468 2,520 2,544 2,628 2,644 2,449 2,489 2,408 2, ,608 2,434 2,598 2,396 2,401 2,445 2,515 2,455 2,030 2,069 1,905 1, ,949 1,904

14 MONTHLY AVAILABLE SEATS 340, , , , , , ,000 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC , , , , , , , , , , , , , , , , , , , , , , , , , ,668

15 TOTAL OPERATIONS 15,000 14,000 13,000 Number of Operations 12,000 11,000 10,000 9,000 8,000 7,000 6,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Number of Operations 07 to 08 Percent Month Change January 12,628 10,163 8, % February 10,322 10,420 7, % March 13,933 10,948 April 11,424 10,501 May 12,734 10,807 June 11,733 11,753 July 12,657 11,599 August 12,057 11,837 September 11,706 11,572 October 10,934 8,889 November 10,624 8,535 December 10,054 8,083 TOTALS 140, ,107 16, % % change YTD

16 TOTAL CARGO Jan Feb Mar Apr May June July Aug Sept Oct Dec CARGO POUNDS (in millions) JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC CARGO (IN POUNDS) PERCENT Month METRIC TONS CHANGE January 10,293,920 11,231,880 8,777,047 3, % February 10,313,441 9,786,730 7,675,284 3, % March 11,129,070 9,519,983 1st Quarter 31,736,431 30,538,593 April 9,653,603 9,915,236 May 10,718,860 9,923,064 June 10,483,160 8,893,972 2nd Quarter 30,855,623 28,732,272 July 10,377,947 9,811,115 August 11,736,465 9,763,038 September 10,311,212 9,890,572 3rd Quarter 32,425,624 29,464,725 October 10,813,406 9,971,505 November 10,646,261 8,811,895 December 12,772,059 12,713,339 4th Quarter 34,231,726 31,496,739 TOTALS 129,249, ,232,329 16,452,331 7, % % change YTD