### BEFORETHE DEPARTMENT OFTRANSPORTATION WASHINGTON, D.C.

Essential Air Service at 

### MACON, GEORGIA


### Under49 U.S.C. §41731 etseq. 

### ) ) ) 

### ) DOT OST-2007-28671 ) 

### )



### SILVERAIRWAYS PROPOSALTO PROVIDE SUBSIDIZEDAIR SERICEAT MACON, GEORGIA
Correspondence with regardto this document should be addressed to: Mickey Bowman Vice President Essential Air Service Silver Airways 1100 Lee Wagener Blvd, Suite 201 Ft. Lauderdale, FL 33315 Telephone: 954-302-5929 Fax: 270-689-2180 E-Mail: mbowman(a)gosilver.com

Silver Airways cordially submits its proposal to provide subsidized air service to Macon, Georgia. Silver Airways hereby offers one option for service.
Silver Airways proposesto operate tlights as an independent carrier, to the hub airports ofboth Atlanta, Georgia and Orlando, Florida. SilverAirways, as an independent airline, maintains interline baggage and ticketing agreements with most legacy carriers. Silver Airways proposes to distributethese flights via its own reservation system allowing sale through both a web based booking engine and through other Global Distribution Systems. As an independent airline, SilverAirways will be in full control ofits scheduling and pricing and will maintain the low local fares thatare the basis for the noted traffic stimulation ofthis bid. Customers with destinations beyondAtlanta or Orlando will find thatthese low local fares will pairnicely with the low fares already offered byboth low cost carriers as well as the legacy caniers servingthese large hubs
Silver Airways intends to focus on thesetwo destinations to retain traffic thathas historically leaked. Key in this offer is the assumption oflow local fares. Low fares drive traffic, pm1icularlyto destinations such as Atlanta and Orlando. We believe these low local fares will drive both Origin/Destinationpassengers and flow traffic overthese hubs. The Macon market will have a chance to return to its historic enplanement levels. given the ability of passengers to connectto both ''low cost" and legacy airlines. Our service will feature a single roundtrip each service day to Atlanta and a single roundtrip each service dayto Orlando.
Atlanta's Hartsfield airport is the nation'sbusiestwith over 1,200 daily departures to over200 cities worldwide. Silver Airways has maintained interline ticketing and baggage agreements with most legacy caniers and will schedule its tlights to allow multiple connecting opportunities. In October of2012 SilverAirways launched servicefrom Atlantato six other Essential Air Service points. This service is marketed under a codesharerelationship with Island Air ofHawaii. This relationship allows SilverAirways flights to be sold via all major global distribution systems,justas SilverAirways existing essential air service in Montana is marketedtoday. SilverAirways maintains its own web basedbooking site as well as areservation call center. On June 7th Silver Airways will further enhance its independentproduct as we move onto a dedicated Sabre Reservation Platform. This state-of-the art Reservation system will allow Silverincreased connectivity and market presence as it will allow Silver Airways flights to be distributed distinctly underthe Silver Airways (3M) brand. Silver intends to further attract Atlanta traffic with a low $50 one way fare and marketingtoutingthe fact that parking in Macon is free.
In Atlanta SilverAirways is participating in what has been called a "close Interline Relationship" with Delta Airlines. Similarto the agreementrecentlyreached between Great Lakes Airlines and DeltaAirlines inthe Minneapolis hub, this ''close Interline" relationship allows connecting itineraries involving SilverAirways and Delta Airlines to appears on the Delta.com website. Additionally, Silver Airways is negotiatingto potentiallyparticipate in the Delta SkyMiles Program as well. SilverAirways will endeavorto add Macon to this program.
From Macon SilverAirways will also serve Orlando International Airport. Orlando is the 13th largest domestic US airport with service to some 91 domestic and 35 international destinations. Orlando service has the addedbenefit of linking Robbins Air Force Base to nearby Patrick Air Force Base and the 45t\ Space Wing to say nothing ofthe tremendous draw ofattractions like Disney World, Sea World and Universal Orlando. The MSA population of Macon is in excess of220,000residents. We firmly believe the fare levels and service patterns we are proposing will capture losttraffic. Additionally, Silverproposes to set its Macon- Orlando fares atthe same levels being offeredbythe discount and legacy carriers from Atlanta Hartsfield International Airport. Local Macon passengers will be able to take advantage ofthese discounted fares AND enjoythe ability to parkfor free and avoidthe often times arduous drive to and from Atlanta. The unique ability ofOrlando service to generate ridership is evidenced in the success ofAllegiant Airlines. In a much smaller, Owensboro, KY, overa short 4year period annual ridership has increased from roughly 500 to over 30,000this past year. The bulk ofthat success is directly attributable to Orlando ridership on atwice weekly service pattern atreasonable fares.

A study ofhistoric Macon traffic reveals the ability ofthe community to enplane far more passengers than we are forecasting. Accordingto DOTT-100 statistics, for full year 2006, Macon enplaned 12,730 passengers while deplaning over 14,000. In :W05, those numbers were I6,307 enplaned passengers with 17,417 deplaned. Obviously there is far greaterpotential for ridership that is currently being captured. SilverAirways believes in the potential of Macon.

In compliance with Public Law I00-223, SilverAirways proposes to operate these flights using Saab 340B+ turboprops that are pressurized and accommodate 34 passengers. The Saab 340 B+ features stand up headroom, a pressurized cabin, a Flight Attendant and an onboard lavatory. The aircraft has ample cargo capacity to accommodate even bulky military duffle bags. We believe that amenities such as these are critical to capture load ridership.ANNUAL ANNUAL ANNUAL ATL-MCN MCN-MCO EAS Total Stats 

### & Assumptions 98% 98% 98%

AircraftType SF3 SF3 SF3 Departures 613 

### 613 1,226 Block Hours 460 945 lAOS Passengers 4,513 7,358 11,872 Load Factor 22% 35% 28.5% Avg Fare 

### $ 44.90 

### $ 116.67 

### $ 89.38 Fuel Price 4.10 4.20 4.17 A/C Miles 49,669 198,064 247,733 RPMs {000) 366 2,377 2,742 ASMs {000) 1,689 6,734 8A23 UtiI

- Blk/Day 1.3 2.6 3.8

Pax Ticket Revenue 202,641 858,480 1,061,121 Oper. Expenses

Fuel 275,677 570,825 846,502 Crew 195A58 401,773 597,231 Maintenance 238,382 490,006 728,387 StationTurns 200,279 221,872 422,150 Distribution 54,615 89,046 143,661 A/C Ownership 33,318 132,862 166,180 Promotion 5,000 5,000 10,000 Fixed Overhead Total 1,002,728 1,911,383 2,914,111 Operating Loss 800,087 1,052,903 1,852,990 5% Profit Margin on Cost 50,136 95,569 145,706 EAS Subsidy 850,223 1,148A73 1,998,696

Subsidy

## I Pax 188 156 168Service Option 1 24Weekly frequencies between Macon, Georgia and Atlanta, Georgia/Orlando, Florida Silver Airways proposes to operate these flights as an independent carrier. The timing ofthese flights wouldbe optimized for connections at each airport as well as optimize local traffic. SilverAirways proposes to encourage connectingtraffic by using a simplifiedlocal fee structure whereby passengers connectingto or from other airline flights would pay only the low, local fare in additionto the low fares already a feature at both Atlanta and Orlando. Thebasic service pattern would consist ofone roundtrip each weekday to Atlanta and One roundtrip each weekday to Orlando. A single roundtripto each hub would operate overthe course ofthe weekend.

Service Option 1
FROM STA TO STA SilverAirways Airlines Sample Flight Schedule

DEP ARR FLT EQUIP FREQUENCY TIME TIME NUM STOP

Macon Orlando 1005am l140am 3631 SF3 Monday thru Saturday 0
Macon Atlanta 615pm 700pm 3632 SF3 Sunday thru Friday 0
FROM STA TO STA
Atlanta Macon
Orlando Macon DEP ARR FLT TIME TIME NUM
900am 945am 3631 415pm 555pm 3632 EQUIP FREQUENCY STOP

SF3 Monday thru Saturday 0
SF3 Sunday thru Friday 0

(Note: This Schedule is for illustrative purposes and may notreflect the final publishedproduct)

In conclusion, SilverAirways believes thatthis proposal will provide the communityofMacon, Georgiawith superior air service

.. We feel the community will benefit from retention oftraffic thathas historically been lostto the highway, the ability to seamlessly connectto and from both low cost and legacy carriers viaboth the Atlanta and Orlando hubs, and finally the integrity ofservice that has been a hallmark ofthe SilverAirways operation. Respectfully Submitted: January 31, 2013

Mickey Bowman Vice President Essential Air Service Silver Airways