r^ART;€NTOF 

:.;:'5PpRWlON 

BEFORE THE -' ^••'•^tRAllOiVc 

DEPARTMENT OF TRANSPORTATION . ,, _ 

WASHINGTON, D.C. ' '•• '•-''- '''-•' A 1!- 5 8 

^'0 

) 

Essential Air Service at ) 

) 

MUSCLE SHOALS, ALABAMA ) OST-2000-7856 

) 

Under 49 U.S.C. §41731 et seq. ) 

GULFSTREAM INTERNATIONAL AIRLINES PROPOSAL 

TO PROVIDE SUBSIDIZED AIR SERICE AT 

MUSCLE SHOALS. ALABAMA 

Correspondence with regard to this document should be addressed to: 

Mickey Bowman 

Vice President of Corporate Development 

Gulfstream International Airlines 

3201 Griffin Road, 4* Floor 

Ft. Lauderdale, FL 33312 

Telephone: 270-689-2180 

Fax:270-689-2180 

E-Mail: mbowman@gulfstreamair.com 

Gulfstream International Airlines ("Gulfstream") cordially submits its proposals to provide subsidized air 

service to Muscle Shoals, Alabama. Gulfstream hereby offers one option for service. 

Gulfstream proposes to operate flights under its independent Gulfstream International Airlines identity to 

the hub airport of Memphis, Tennessee. Gulfstream has maintained interline ticketing and baggage 

agreements with most legacy carriers and will schedule its flights to maximize connecting opportunities. 

Gulfstream contends that reasonable local fares will stimulate demand and the variety of destinations 

available from Memphis will allow this market to grow. Toward that end we will establish a fare structure 

predicated on a $150 roundtrip fare between this city and Memphis. Gulfstream flights will be available 

for sale through all major reservation portals and we will maintain our own web based booking site as well 

as a reservation call center. 

It should also be noted that Gulfstream is in discussions with a major legacy carrier in an effort to offer a 

codeshare on these flights. Should those efforts be successful. Muscle Shoals passengers will enjoy 

amenities very similar to what they are receiving today including through pricing and baggage check, 

advance seat selection, inclusion in the legacy carrier frequent flyer program and reservation service 

through all major online portals as well as the legacy carrier's own website and call center. 

In compliance with Public Law 100-223, Gulfstream proposes to operate these flights using Beech 1900D 

turboprops that are pressurized and accommodate 19 passengers. The 1900D features stand up headroom 

with ample cargo capacity to accommodate even bulky military duffle bags. 
One of the hallmarks of the Gulfstream operation is our ability to provide safe and reliable transportation. 

Toward this end, Gulfstream would establish a regional maintenance base in Muscle Shoals or Memphis in 

support of these flights. This move will add roughly 12 technical support jobs to the local economy. 

Additionally this proposal includes a second aircraft that would be a dedicated spare. With this spare 

located in Memphis, we would have great flexibility in responding to any operational challenges and 

assures this community receives the level of operational performance it deserves. As Gulfstream's first 

foray into the Memphis market, this bid does reflect higher unit costs associated with the establishment of 

this Maintenance Base, the inclusion of a Spare Aircraft and the effect on crew productivity as a 

consequence of scheduling our flights for maximum connectivity to the major airlines in Memphis 

Gulfstream is committed to building its presence in Memphis and the establishment of these basic bits of 

infrastructure will provide a solid and reliable base for the future. 

Service Option 1 

36Weekly frequencies between Muscle Shoals, Alabama and Memphis, Tennessee. 

Gulfstream proposes to operate these flights under it own independent marketing identity, though it will 

work to secure a Legacy Carrier codeshare relationship prior to actual service start. The timing of these 

flights will be optimized for connections to and from other airline flights at Memphis Gulfstream proposes 

to encourage connecting traffic by using a simplified local fee structure whereby passengers connecting to 

or from other airline flights would pay only the low, local fare in addition to the low fares already a feature 

at Memphis. The basic service pattern would consist of three roundtrips each weekday to Memphis. A 

single roundtrip would operate on Saturdays and two roundtrips would be operated on Sundays to 

Memphis. 

Service Option 1 

Gulfstream Airlines 

Sample Flight Schedule 

FROM 

STA 

TO 

STA 

DEP 

TIME 

ARR 

TIME 

FLT 

NUM 

EQUIP FREQ STOP 

MUSCLE SHOALS 

MUSCLE SHOALS 

MUSCLE SHOALS 

MEMPHIS 0650 0750 2501 BEl X7 0 

MEMPHIS 1150 1250 2503 BEl X6 0 

MEMPHIS 1645 1745 2505 BEl X6 0 

MEMPHIS 

MEMPHIS 

MEMPHIS 

MUSCLE SHOALS 

MUSCLE SHOALS 

MUSCLE SHOALS 

0930 1030 2502 BEl X7 0 

1445 1545 2504 BEl X6 0 

1935 2035 2506 BEl X6 0 

(Note: This Schedule is for illustrative purposes and may not reflect the final published product) 
GULFSTREAM INTERNATIONAL AIRLINES 

Essential Air Service Proposal 

Muscle Shoals, AL - Memphis, TN 

Option 1 

Muscle 

Shoals 

Hub Served 

Number of Roundtrips per Service Day 

(3 non-stop) 

Goeratine Statistics 

Assumed Completion % 

Annual Adjusted Block Hour; 

Annual Adjusted Departures 

Annual Adjusted ASMs 

Annual RPMs 

Projected Load Factor 

Revenue Proiections 

Enplaned Passengers 

Mileage 

Average Fare 

Passenger Revenue 

ExDense Proiections 

Flight Operations 

Ownership 

Maintenance 

(Average as 

Operated) 

Reservations, Stations & Administration 

Fuel 

Marketing 

Total Annual Expenses 

Projected Profit / (I^ss) 

Profit Element 

Annual Subsidy Required 

Subsidy per Departure 

Subsidy per Passenger 

@5% 

Memphis 

3 

98% 

1,686.30 

1,839.61 

4,753,539 

2,278,816 

47.9% 

16,756 

136 

$ 69.38 

$ 1,162,448 

$338,939 

$323,952 

$1,410,881 

$1,126,704 

$708,248 

$12,000 

$3,920,724 

($2,758,277) 

$196,036 

$2,W4^13 

$1,605.95 

$176.31 
In conclusion, Gulfstream believes this proposal will provide the community of Muscle Shoals with a 

superior air service option. We feel the passengers will benefit from the fact that Memphis is a primary 

logistical and business center with an airport that serves as a hub for a major legacy carrier. In 2009 over 

5,000,000 passengers enplaned in Memphis. Delta Air Lines alone offers over 200 daily departures with 

non-stop service to some 87 destinations around the world. Gulfstream will provide this service on stand 

up, pressurized airliners and the infrastructure we will establish in support of this operation will add jobs to 

the local economy. Additionally the integrity of service that has been a hallmark of the Gulfstream 

operation will assure both dependability and reliability to the traveling public and result in increased 

ridership and passenger satisfaction. 

Respectfully Submitted: December 17,2010 

Mickey Bowman 

Vice President of Corporate Development 

Gulfstream International Airlines