## 'APARTMEN T OF , BEFOR E TH E ' • • /T

- r OPERATION

S DEPARTMEN T O F TRANSPORTATIO N

WASHINGTON,D.C
. w n --,• ? j c A I r 2 8 ) Essentia l Ai r

Servic e a

t ) ) 

### MACON , GEORGI A ) OST-2007-2867 1 ) 

### Unde r 4 9 U.S.C
. §4173 1 e t

seq . )
GULFSTREA M INTERNATIONA L AIRLINE S PROPOSA L T O PROVID E SUBSIDIZE D AI RSERIC E A T

MACON
. GEORGI A Correspondenc e wit

h regar dt o thi s documen t shoul db e addresse dto : Micke y Bowma n Vic e Presiden t

o f Corporat e Developmen t Gulfstrea mInternationa l Airline s 320 1 Griffi n Road , 4 * Floo r Ft
. Lauderdale , F L 3331 2 Telephone : 270-689-218 0 Fax:270-689-218 0 E-Mail : mbowman@gulfstreamair.co m Gulfstrea mInternationa l Airline s ("Gulfstream" ) cordiall y submit s it s proposa l to provid e subsidize dai r servic e t o Macon , Georgia
. Gulfstrea mhereb y offer s on e optio n for service
. Gulfstrea mpropose s t o operat e flight s a s an independen t carrier , t o th e hu b airport s o f both Orland o an d Tampa , Florida
. Gulfstream , a s a n independen t

airline , maintain s interlin e baggag e an dticketin g agreement s wit

h mos t legac y carriers
. Gulfstrea mpropose s t o distribut e thes e flights vi ait s ow n reservatio n syste mallowin g sal e throug h both awe b base dbookin g engin e an dthroug h othe r Globa l Distributio n Systems
. A s a n independen t

airline , Gulfstrea mwil l b e in full contro l o f it s schedulin g an d pricin g an dwil l maintai n th e lo w loca l fare s that ar e th e basi s fo

r th e note dtraffi c stimulatio n o f thi s bid
. Customer s wit

h destination s beyon dOrland o o r Tamp awil l fin dthat

thes e lo w loca l fare s wil l pai r nicel y wit h th e lo w fare s alread y offere dfromOrland o an dTamp ab y both lo w cos t carrier s a s wel l a s th e legac y carriers
. Shoul dth e communit y prefer , Gulfstrea mwoul db e wil l t o servic e eithe r hu b exclusiv e o f

th e other
. Gulfstrea mintend s t o focu s o n thes e tw o destination s t o retai n traffi c tha t ha s historicall y leake dt o Atlanta
. Ke y in thi s offe

r i s th e assumptio n o f

afare o f onl y $45.33 , th e bas e o f

$49.00
. Lo w fare s driv e traffic , particularl y t o destination s suc h a s Orland o an dTampa
. W e believ e thes e lo w local fare s wil l driv e bot h Origin/Destinatio n passenger s an dflow traffi c ove r thes e hubs
. Th e Maco n marke t wil l hav e achanc e to return t o it s histori c enplanemen t levels , give n th e ability o f passenger s t o connec t

bot h "lo w cost " an d legac y airlines
. Ou r

servic e wil l featur e asingl e roundtri p eac h servic e day t o Orland o an dasingl e roundtri p eac h servic e day t o Tampa
. Tamp aservic e ha s th e adde dbenefi t o f linkin g Robbin s Ai r

Forc e Bas e t o th e MacDil l Air

Forc e Bas e facilit

y an dit s 6" " Ai r

Mobilit y Wing
. Th e MS A populatio n o f Maco n i s in exces s o f

220,00 0 residents
. W e firmly believ e th e fare level s an dservic e pattern s w e ar e proposin g wil l captur e los t

traffic
.A stud y o f histori c Maco n traffi c reveal s th e ability o f th e communit y to enplan e fa r mor e passenger s tha

n w e ar e forecasting
. Accordin g to DO T T-lO O statistics , fo r ful l year 2006 , Maco n enplane d12,73 0 passenger s whil e deplanin g ove r 14,000
. I

n 2005 , thos e number s were 16,30 7 enplane dpassenger s wit h 17,41 7 deplaned
. Obviousl y ther e i s fa r greate r potentia l fo

r ridershi p that

i s currentl y bein g captured
. Unfortunately , in it s cursory revie w o f ou r origina l filin g th e DO T di dno t recogniz e th e traffi c potentia l o f thi s proposal
. Quotin g fro mOrde r 2010-10-5 , i

t stated , "Gulfstream' s subsid y reques t o f $2,733,97 5 woul d resul t in asubsid y pe r

passenge r

in exces s o f

$900. " Gulfstrea mbelieve s i n th e city o f Macon
. T o demonstrat e ou r

commitment , Gulfstrea mpropose s t o ca p it s reques t fo r subsid y at

arat e no t

t o excee d $20 0 pe r enplane dpassenge r

afte r th e initia l si x month s o f

service
. Gulfstrea mpropose s t o utiliz e asi x calendar month , rollin g averag e o f enplane dtraffi c a s ametric
. Th e si x mont h rollin g averag e woul db e use dt o addres s any normal seasonalit y tha t migh t exis t in th e marketplace
. I n a s muc h a s al l ne w servic e initiative s tak e som e tim e t o mature , Gulfstrea mwoul dpropos e that thi s "ca p mechanism " begi n in it s 6t h month o f

servic e o r

afte r roughl y 18 0 day s o f

service
. In othe r words , shoul dGulfstrea mbegi n Maco n servic e Januar y 1 , 2011 , th e propose d$20 0 cap woul db e pu t int o effec t fo r th e full month o f

Jun e 2011
. Gulfstrea mwoul dpropos e t o includ e th e passenge r enplanement s o n th e ne w route s in it s monthl y clai mdocuments
. In asimilar fashio n a s th e clai mdocumen t applie s a weekl y subsid y ca p o n completions , Gulfstrea mwoul dpropos e t o limi t it s ow n subsid y reques t

b y applyin g ametri c o f

arollin g si x mont

h averag e o f

Enplane dPassenger s multiplie db y $20 0 for th e Billin g Perio di

n question
. In example , assumin g aJan
. 1 201 1 servic e start , Gulfstrea mcompensafio n fo r th e Jun e 201 0 billin g perio dwoul db e subjec t t o a$20 0 pe r

enplane dpassenge r

cap , wit h th e enplanemen t

figure bein g determine db y th e averag e o f th e monthl y enplanement s o f mont h o f Jan-1 1 throug h Jun-11
. Similarly , Jul y 201 1 woul db e cappe dwit h a n enplanemen t

figure derive dfroman averag e fo r th e perio do f

Feb-1 1 throug h Jul-11
. Assumin g sufficien t enplanements , Gulfstrea mwoul dreceiv e th e ful l amoun t o f th e subsid y owe dcommensurat e wit h norma l completio n calculations
. Durin g th e termo f thi s contract , shoul dth e statutor y $20 0 ca p b e raised , Gulfstrea mwoul dpropos e th e cappin g mechanis mb e raise da s well
. In complianc e wit

h Publi c La w 100-223 , Gulfstrea mpropose s t o operat e thes e flights usin g Beec h 1900 D turboprop s tha

t ar e pressurize dan daccommodat e 1 9 passenger s to the , FA A defined , hub s a t Orlando , F L an dTampa , FL
. Th e 1900 D feature s stan du p headroo man dapressurize dcabi n that w e feel i s critica l i

n recoverin g los t

passengers .Servic e Optio n 1

24WeekI y frequencie s betwee n Macon , Georgi aan dOrlando , Florida/Tampa , Florid a Gulfstrea mpropose s t o operat e thes e flights a s a n independen t

carrier
. Th e timin g o f

thes e flights woul d b e optimize dfor

connection s a

t eac h airpor t

a s wel l a s optimiz e local traffic
. Gulfstrea mpropose s t o encourag e connectin g traffi c b y usin g asimplifie dlocal fe e structur e whereb y passenger s connectin g t o o r fro mothe r

airlin e flights woul dpay onl y th e low , local fare i n additio n t o th e lo w fare s alread y afeatur e a t bot h Orland o an dTampa
. Th e basi c servic e patter n woul dconsis t o f On e roundtri p eac h weekda y t o Orland o an dOn e roundtri p eac h weekda y t o Tampa
. A singl e roundtri p o n Saturda y woul doperat e to Orland o an dasingl e roundtri p o n Sunday woul doperat e t o Tampa
.

Servic e Optio n 1 FRO M T O ST A ST A Gulfstrea mAirline s Sampl e Fligh t

Schedul e
DE P AR RFL T EQUI P FREQUENC Y TIM E TIM E NU M STO P
MC N MC O 900a m1040a m931 0 BE l Monda y thr u Saturda y 0 MC N TP A 130p m310p m931 1 BE l Sunda y thr u Frida y 0 FRO M T O DE P AR RFL T EQUI P FREQUENC Y STO P ST A ST A TIM E TIM E NU M MC O MC N 1120a m100p m931 0 BE l Monda y thr u Saturda y 0 TP A MC N 400p m540p m931 1 BE l Sunda y thr u Frida y 0 (Note : Thi s Schedul e i s fo r illustrativ e purpose s an dma y no t reflec t th e fina l publishe dproduct )GULFSTREA M INTERNATIONA L AIRLINE S Essentia l Ai r

Servic e Proposa l Macon , G A 1 Roundtrip s t o Orlando , FL , 1 Roundtrip s t o Tampa , F L

Hu b Serve d Numbe r o f Roundtrip s pe r

Servic e Da

y Operatin e Statistic s Assume dCompletio n % Annua l Adjuste dBloc k

Hour s Annua l Adjuste dDeparture s Annua l Adjuste dASM s Annua l RPM s Projecte dLoa dFacto r Revenu e Projection s Enplane dPassenger s (Averag e a s Mileag e Operated ) Averag e Far e Passenge r

Revenu e Expens e Projection s Fligh t Operation s Ownershi p Maintenanc e Reservations , Station s & Administratio n Fue l Marketin g Macon , G A Orland o /

Tamp a

98 % 2,044.4 1 1,22 6 7,573,04 1 4,468,75 0 59.0 % 13,75 0 32 9 $45.3 3 $ 623,21 9 $236,57 2 $306,36 0 $816,16 0 $902,96 9 $905,26 7 $30,00 0 Tota l Annua l Expense s $3,197,32 7 Projecte dProfi t

/ (Loss ) ($2,574,109 ) Profi t Elemen t @ 5 % $159,86 6
Annua l Subsid y Require d$2,733,97 5 Subsid y pe r

Departur e $2,229.2 6 Subsid y pe r

Passenge r

$ 198.8 3 Note , for purpose s o f

thi s bid , th e tw o route s ar e show n collectivel y giv e th e fac t that th e stag e length s ar e virtuall y identica l an dou r station s cost s very similar
. Additionall y w e feel th e traffi c wil l b e roughl y equivalen t

whethe r t o an dfro mOrland o o r

Tampa
. In conclusion , Gulfstrea mbelieve s tha t thi s proposa l wil l provid e th e communit y o f Macon , Georgi awit

h superio r ai r service
. Gulfstrea mbelieve s tha t th e "cappin g mechanism " w e ar e proposin g wit h thi s bi di s bot h innovativ e an dindicativ e o f th e leve l o f

commitmen t

w e hav e for

th e Essentia l Ai r

Servic e Program
. W e feel th e communit y wil l benefi t fro mretentio n o f

traffi c that

ha s historicall y bee n los t t o Atlanta , th e ability t o seamlessl y connec t t o an dfro mbot

h lo w cos t

an dlegac y carrier s vi aboth th e Orland o an dTamp a hubs , an dfinall y th e integrity o f servic e that

ha s bee n ahallmark

o f th e Gulfstrea moperation
. Respectfull y Submitted : Novembe r 12 , 201 0
Micke y Bowma n Vic e Presiden t

o f Corporat e Developmen t Gulfstrea mInternationa l Airline s