BEFORETHE , _ _ ,^ 

DEPARTMENT OF TRANSPORTATION 

WASHINGTON, DC 

1^ C ^ 

Essential Air Service at 

Watertown, NY 

Under 49 U.S.C §41731 et seq. 

DOT-OST-1997-2842 

AMERICAN EAGLE AIRLINES PROPOSAL TO PROVIDE ESSENTIAL AIR SERVICE AT 

WATERTOWN. NEW YORK 

American Eagle Airlines, a wholly owned subsidiary of AMR Corporation, ("American Eagle") 

respectfully submits its proposal to provide subsidized Essential Air Service to Watertown, New 

York. American Eagle contemplates service from AMR's second largest hub at Chicago O'Hare 

International Airport ("ORD") to the Watertown International Airport C'ART"), with two 

roundtrips on Embraer Regional Jet aircraft. 

American Eagle is the predominate regional carrier for American Airlines, offering more than 

1500 daily departures with service to more than 180 cities. Through our relationship with 

American Airiines, our customers have access to more than 250 cities, 40 countries and more 

than 3400 daily departures. In addition, our oneworid alliance provides our customers access 

to over 700 destinations and 140 countries worldwide. At ORD alone, American and American 

Eagle offer more than 500 daily departures to over 115 destinations. This direct access to 

AMR's and oneworld's vast networks should help stimulate the traffic to/from Watertown with 

significantly more convenient connecting options than have been offered in the community for 

years. 

Although American Eagle has recently re-entered the subsidized Essential Air Service market 

with service to Joplin, Missouri, and Grand Island, Nebraska starting in June 2011, we have been 

serving smaller communities for many years. In the case of Roswell, New Mexico, we took a 

market that was on the verge of subsidized service after Mesa Airlines announced its departure, 

and turned it into a self-sustaining market with three daily flights to DFW. In Manhattan, 

Kansas, American Eagle was brought in to serve the community through a partnership with the 

state of Kansas and have taken a community that has historically had subsidized service and 

made it self-sustaining as well. American Eagle hopes and believes that we will have as much 

success in Watertown as we have had in Roswell and Manhattan. 
American Eagle also has a significant amount of experience operating in markets with large 

military installations. The presence and importance of Fort Drum is an important part of the 

long-term viability of air service at Watertown. Through data received from ART, it appears 

that Fort Drum rarely uses the current air service, forcing them to use the Syracuse airport. 

This causes increased cost and inconvenience to our service members. We feel that with a 

regional jet product Into a major hub like ORD, Fort Drum will utilize our service more than the 

current operator and this will be a critical piece in hopefully eliminating the subsidy 

requirement long-term from ART. 

American Eagle would like to request to the DOT that it allow American Eagle to operate for the 

same subsidy amount any Embraer Regional Jet. We plan on operating 44-seat regional jets on 

the route, but allowing us to substitute in larger or smaller regional jet aircraft would allow us 

the flexibility to match supply with demand, as well as day-of-operation swaps for operational 

flexibility. American Eagle also requests the DOT and Watertown to waive the right to hold-in 

American Eagle upon issuance of a 120 day's notice to terminate service. Although we do not 

foresee this to be an issue and plan on being in Watertown for many years to come, we cannot 

be operationally constrained and kept in a market indefinitely, without ability to adapt to the 

marketplace. 

We believe that these recent examples of great success in smaller communities are a 

demonstration of American Eagle's success in bringing a quality product and a worid-renowned 

brand to the community. Further, American Eagle is the only regional airline with a dedicated 

Marketing and Sales group that will promote the brand and network in Watertown. 

We look forward to serving the Watertown and northern New York area for many years to 

come and appreciate the community's and the Department of Transportation's consideration of 

American Eagle. 

Sincerely, 

Rob Em rich 

Director of Planning 

American Eagle Airlines 
Market: 

Aircraft 

Mileage 

Annual Daps (Factored) 

Block per Dep 

Annual Block Hours (Factored) 

Completion % 

Revenues 

Annual Passengers 

Avg Fare - Onboard 

Total Revenues 

Exioenses 

Flight Operations 

Fuel 

Stations 

Other 

Total Expenses 

Profit / (Loss) 

Profit Element (@ 5%) 

Subsidy Required 

Subsidy / Departure 

Subsidy / Pax 

Watertown. NY to Chicaao O'Hare 

617 

1,223 

2.375 

98% 

28,737 

$142 

$4,094,786 

$1,800,230 

$2,752,794 

$1,468,138 

$781,466 

$6,802,627 

($2,707,841) 

$340,131 

$3,047,972 

$2,492 

$106.07 

Number of Seats per Dep 

Annual ASMs (Factored) 

Annual RPMs (Factored) 

Annual LF 

44 

33,203,090 

17.730,450 

53% 

Proposed Schedule* 

Sepment 

ART-ORD 

ORD-ART 

ART-ORD 

ORD-ART 

Depart 

7:15 

13:05 

16:30 

18:30 

Arrive 

8:15 

15:55 

17:30 

21:20 

Freauencv 

xSun 

xSun 

xSat 

xSat 

'Schedule is shown for illustrative purposes only and American Eagle reserves the right to change without notice