## Proposal to Provide Essential Air Service at Hot Springs, Arkansas El Dorado, Arkansas Docket DOT

-OST - 1997-2935

Direct Inquiries Regarding this Proposal to:

Shane Storz, CEO Air Choice One Airlines 12300 Old Tesson Road, Suite 200 F, Saint Louis, MO 63128 Phone: (866) 435 -9847 Fax : (314) 843 -8527 E - mail: shane@airchoiceone.com



# Multi -Aero Inc. d/b/a Air Choice One

# Our Commitment Air Choice One is aware of the many challenges facing the local Hot Springs and El Dorado, Arkansas communities. This proposal will give the best access to the national transportation system for the communities at reasonable prices. We understan d the efforts of a dedicated air carrier are critical to having scheduled airline service in the future. Air Choice One is that air carrier and we believe the strategy outlined in our proposal will support and complement airport development efforts. We have proven our strategy works with other EAS communities and we are committed to delivering these same dramatic increases in enplanements and sustaining these numbers over time. Analyzing the challenges ahead, we feel it is a sound approach for Air Choice One to begin operation under our current part 1 35 air carrier certification. We propose to provide non - sterile service to accommodate the current absence of TSA at these airports . As a further provision for the lack of TSA out of Hot Springs and El Dorado Airports , our non - sterile service will also include a dedicated shuttle van service at Dallas/Fort Worth International Airport. Our private shuttle van will increase the ease of travel for our passengers and simplify the process of connecting to other carriers. Additionally, this proposal allocates substantial resources to support marketing efforts. Our achievements in our other EAS markets demonstrate that our marketing strategies are successful. Through on - site community outreach, community- specific advertising, consistent flight schedules, and outstanding customer service we will build consumer recognition in the community and drive passengers back to your airport. As we grow ridership, we will turn our attention to sustaining this growth. We p ropose to work with local airport authorities in support of TSA returning services to your airport. Reestablishing a TSA presence w ill return services travelers both want and need when connecting to a medium or large hub airport. These services also serve as an additional pathway to sustaining growth. Increased passenger loads will provide the resources needed for Air Choice One to continue its growth and for the airport to regain full Part 139 status. We commit to providing you with outstanding service. We believe our successes in our other EAS markets, analysis, planning, a nd dedication to the community enables us to overcome the current challenges at these airports and recapture the confidence of l oca l travelers. We will continue working with you throughout our term to provide the next level of air service that will bring us all success. 07/12/2011

# Market Growth Strategy - Airport Partnerships Air Choice One will team with your local airport to raise awareness about your communities’ air service and increase enplanements.
• LOCAL AIRPORT INITIATIVES WILL GROW RIDERSHIP • Provide Financial Support Through Discounted Fuel Costs, Landing Fees, and Rental Agreements • Educate the Community about the EAS Program and Air Choice One’s Service • Draft and Distribute Press Releases • Community Involvement • Participate in TV and Radio Coverage • Distribute Information Pertaining to Air Choice One at Local Business Events

07/12/2011

# Market Growth Strategy –

Partnering With the Community

07/12/2011 Air Choice One is dedicated to working with your community to reinvigorate the service at your airport and sustain growth that will launch us into the future.
• WE ARE YOUR NEIGHBORS • Corporate Headquarters in Midwest • Increase Local Career Opportunities • WE ARE IN YOUR COMMUNITY • Routine On - Site Sales Visits • Chamber of Commerce Participation and Membership • STRONG PUBLIC RELATIONS AND MEDIA OUTREACH • Business Incentive Programs • Travel Agent Discounts • Business to Business Communication • Attendance at Public Events • WE KEEP YOU INFORMED • Monthly Airport Board Updates

# Market Growth Strategy – Marketing Investment

07/12/2011 Air Choice One reinvests in our served communities.

• TRADITIONAL MEDIA • Radio-Talk Shows/Commercials • TV Commercials and Event Coverage • Print- Newspaper/Magazines • Billboards • Web Based

– E - Blasts

– Monthly E - Mail Promotions

– City Representation on Our Website • SOCIAL MEDIA • Twitter, Facebook, Linked In • INTERACTIVE MEDIA • Contests • You Tube/Videos • EVENTS AND SPONSORSHIPS • Local Charitable Support- March of Dimes, Make -A-Wish Foundation, Red Cross, etc. • Business/Community Support- Golf Tournaments, Business Luncheons, Air Shows, etc. • COMMUNITY TICKET OFFICE

# Market Growth Strategy – Reliability & Growth

• CONSISTENT SERVICE TO DFW WILL 

### INCREASE RIDERSHIP • Proven Success in Other EAS Markets • Builds Passenger Confidence in Carrier • Dedicated Aircraft for your Airport

– 102% Flight Completion Ratio as Reported by DOT YR 2010

– Spare Aircraft Availability 

### • AIR CHOICE ONE’S REVENUE INCREASED BY OVER 20% YE 2010 VS. 

### 2009

07/12/2011 75

80 85 90 95 100 105

Am. Eagle Gr. Lakes Sea Port Air Choice Completion %



## Airline Airline Completion Ratios

Works Cited: T- 100 Segment Report DOT 2010 Calendar Year

# Market Growth Strategy – Accessibility

• VISIBILITY • Global Distribution Systems

– Apollo, Worldspan, Travelport, Amadeus, etc. • Consumer Sites

– Expedia, Travelocity, Priceline, Orbitz, etc. • Web based booking

– www.airchoiceone.com • Call Center

– Open 7 Days a Week


### • CONNECTIVITY • United Airlines Agreement • Actively Pursuing More Legacy Agreements 07/12/2011

# Market Growth Strategy – Pricing Air Choice One offers the right price for the right ticket at the right time. We take all things into consideration and enter the market with low fares. We work hard to establish a winning price point through targeted market analysis. We believe consistent pricing builds consumer confidence.
• BUILDING & SUSTAINING RIDERSHIP THROUGH PRICE • Introductory Fares Peak Interest and Drive Passengers to Air Choice One and Your Airport • On - Going Affordable Fares = Full Planes! • Full Planes Establish the Customer Base Needed to Reduce Future Subsidy Requirements 07/12/2011 

## 0 500 1000 1500 2000 2500 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec # of Passengers

Month of Service Air Choice One Ridership Growth EAS Markets 2010-2011*



### 2010 2011 *Numbers Reflect O & D

# Marketing Growth Strategy -

New Hub, New Opportunities

07/12/2011 Source: Innovata Schedules, August 2011 . 

### • DALLAS/FORT WORTH INTERNATIONAL AIRPORT (DFW) KEY TO SELLING MORE TICKETS AND GROWING RIDERSHIP • Greatest Access to the National Transportation System for the Communities Carry Over 155,000 Passengers Per Day • Ranked 3 rd in the World For Operations • Ranked 8th in the World For Passengers • DFW Carried Over 56 Million Passengers in 2010 • Every Major City in the U.S. Can Be Accessed Within 4 Hours • Over 45 International Destinations 

## 0 20 40 60 80 100 120 140 160 180 

## 200 # of Destinations

Airport DFW vs. MEM Destinations

DFW MEM

# Marketing Growth Strategy -

New Hub, New Opportunities

07/12/2011 Source: Innovata Schedules, August 2011 . 

## Dallas/Fort Worth International Airport Air Choice One Ticket Counter 

## Terminal E Private Shuttle Connecting Passengers 

## From DFW Corporate Aviation To All Other DFW Terminals

# Marketing Growth Strategy -

New Hub, New Opportunities

07/12/2011 

## SHUTTLE SERVICE We provide curbside service to connecting flights to and from all terminals at Dallas/Fort Worth International Airport. Our shuttle van service offers a hassle -free travel experience. 

## NON -STERILE OPERATION Due to absence of TSA services in the local community, we are offering non sterile service in DFW. Over time, as passenger loads increase, we will support efforts to bring TSA back to your local airport. Regaining local TSA will further contribute to ridership growth.

# Options Index Combined Service Hot Springs, AR – El Dorado/Camden, AR

OPTION 1, 2 YEAR SERVICE – DFW SERVICE CESSNA GRAND CARAVAN Combined/Dual Service – Hot Springs, Arkansas & El Dorado/Camden, Arkansas – Dallas/ Fort Worth International Cessna Grand Caravan 18 Round Trips Per Week

07/12/2011

### Hot Springs, AR & El Dorado/Camden, AR – Cessna Grand Caravan Option 1: 2 Year Combined/Dual Service 

### 18 Total Round Trips Per Week – Based on 98% Completion Rate Combined Service – Hot Springs, AR & El Dorado/Camden, AR – Dallas/Fort Worth International– Caravan Operation Revenues HOT- DFW & ELD- DFW Revenues $ 1,595,000.00 Other Revenues 15,950.00 Total Operating Revenues $ 1,610,950.00 Direct Operating Expenses Flying Operations $ 632,362.50 Fuel and Oil 1,480,992.98 Maintenance 1,644,142.50 Aircraft Leases 500,000.00 Total Direct $4,257,497.98 Marketing 97,119.00 Indirect 1,295,740.00 Total Operating Expenses $5,650,356.98 Operating Loss $4,039,406.98 Profit Element (5% total Oper. Exp.) 282,517.85 Compensation Required $4,321,924.82 Compensation per PAX $392.90 Compensation per Departure $1,174.69 # Passengers: 11,000 Average Fare: $145.00 Departures: 3,680 Block Hours: 5,058 Revenue Passenger Miles: 2,756,000 Available Seat Miles: 7,488,000

07/12/2011 Representative Schedule Departure Arrival

HOT 5:30 AM DFW 7:00 AM DFW 8:30 AM HOT 10:00 AM ELD 5:30 AM DFW 7:00 AM DFW 8:45 AM ELD 10:15 AM HOT 11:15 AM DFW 12:45 PM DFW 1:30 PM HOT 3:00 PM ELD 11:30 AM DFW 1:00 PM DFW 2:00 PM ELD 3:30 PM HOT 3:30 PM DFW 5:00 PM DFW 7:00 PM HOT 8:30 PM ELD 4:30 PM DFW 6:00 PM DFW 7:30 PM ELD 9:00 PM

# The Best Choice to Succeed

07/12/2011 

### • Proven Enplanement Increase in EAS Markets • Successful Pricing Strategy • Demonstrated Growth in Community Support • Proven Reliability • Outstanding Completion Ratio • Great Hub Connectivity 

### • Successful Marketing and Public Relations Outreach • Raise Awareness About Local Air Service • We Cater to Community and Business Needs 

# We Look Forward to Serving You!