## Proposal to Provide Essential Air Service at

Ironwood, Michigan

Docket DOT

- OST

- 1997

- 1266 February 5, 2014

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

Leads to Success

02/05/2014 

### Air Choice One sees challenges in the community of Ironwood, Michigan similar to those we have 

### recently overcome in Jonesboro, Arkansas . Throughout our Jonesboro service period Air Choice One has worked in partnership with the community to reestablish their standing within the Essential Air Service Program.

In less than 2 years Jonesboro has gone from potential expulsion from the EAS program to completing a successful probationary period supported by Air Choice One. This resulted in a contract extension 

### and secured Jonesboro’s position within the EAS program for their next contract period. We are proud of the success we have achieved together and feel we can apply the action plans utilized in Jonesboro to achieve similar results in Ironwood. Some key milestones of the partnership are highlighted in the coming pages.

We welcome the opportunity to provide the community of Ironwood with the highest level of service in the upcoming service period

.

# Our Commitment

Leads to Success

02/05/2014 AVERAGE ENPLANEMENTS: At the 2011 RFP, Jonesboro was averaging 1.5 enplanements per day. For the year ending March, 2013 Jonesboro averaged 16.5 daily enplanements exceeding the DOT minimum of 10 per day by 65 %.

By improving service reliability, introducing a new hub, offering VIP travel at a reasonable price, promoting both Chicago and Ironwood as reciprocal vacation destinations, etc.

we believe we will achieve similar results in the community of Ironwood

.

AVERAGE PER PASSENGER SUBSIDY: Also in the 2011 RFP, Jonesboro’s average per passenger subsidy for the 12 months ended January, 2011, was $ 840. For the period ending September, 2013, the average had been reduced to $177 representing an enormous improvement.

Ironwood has reported a year over year decline in most recent enplanement numbers. Air Choice One believes there is untapped potential and once passenger enplanements are improved subsidy numbers will fall. It is our goal to support the community of Ironwood in reducing per passenger subsidies.

# Our Commitment

Leads to Success

AIR CHOICE ONE, 

## IRONWOOD, AND CHICAGO O’HARE: A WINNING COMBINATION!

02/05/2014 Terminal 3, Gate L10B

SERVICE IMPROVEMENTS: Jonesboro patrons had been transported to Memphis International Airport whose passenger service options were (and remain) on the decline. By connecting to a new hub in St. Louis, Jonesboro passengers now have greatly improved service options through multiple carriers operating approximately 234 daily departures to 64 domestic and international markets. We feel that a change from Minneapolis

- St. Paul International Airport to Chicago O’Hare International Airport will bring a similar boost in passenger interest due to the attraction of Chicago as a destination and endless travel connections available through O’Hare. We also believe Chicago residents will find Ironwood and the surrounding countryside a welcome getaway from the hustle and bustle of city life. Chicago O’Hare At A Glance

• 50 Carriers (January 2012)

• Serving Nearly 67 Million Passengers (2011)

• 198 destinations (January 2012)

# Our Fleet

Cessna Grand Caravan

02/05/2014

Exceptional Cargo Space Well

- Appointed Cabin

Proven ReliabilityAir Choice One reinvests in our served communities and will grow ridership

• 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

• Charitable Support to Resident Organizations and Local Chapters of National Non

- Profit Organizations

• Business/Community Support through Golf Tournaments, Business Luncheons, Air Shows, etc.

• COMMUNITY TICKET OFFICE 

# Market Growth Strategy

–

Marketing Investment

02/05/2014

# Market Growth Strategy

– Pricing & Accessibility

Air Choice One offers the right price for the right ticket at the right time and offers many convenient ways to book your tra vel through our website, toll

- free calling, local travel agencies, and online booking sites.

02/05/2014 • BUILDING & SUSTAINING RIDERSHIP

THROUGH PRICE

• We work hard to establish a winning price point through targeted market analysis. We take all factors into

consideration and enter the market with

low fares.

• Introductory Fares Peak Interest and Drive Passengers to Air Choice One and Your Airport

• On

- Going Affordable Fares = Full

Planes!

• We believe consistent pricing builds

consumer confidence

• CONVENIENT OPTIONS MAKE BOOKING

TRAVEL A SNAP!

• www.airchoiceone.com

• Call us at 1

- 866

- I

- FLY

- VIP

• Visit your local Travel Agent

• Find us on Travelocity, Expedia, Priceline, Kayak and more

# Options Index Ironwood, Michigan

OPTION 1, 2 YEAR SERVICE OR 4 YEAR DISCOUNTED SERVICE

– ORD

CESSNA GRAND CARAVAN OR PIPER NAVAJO

Ironwood, Michigan

– Chicago O’Hare International Airport

Cessna Grand Caravan or Piper Navajo 4 Year Service Discounted in Years 3

- 4 12 Round Trips Per Week

02/05/2014 OPTION 2

, 2 YEAR SERVICE OR 4 YEAR DISCOUNTED SERVICE

– ORD

CESSNA GRAND CARAVAN OR PIPER NAVAJO

Ironwood, Michigan

– Chicago O’Hare International Airport

Cessna Grand Caravan or Piper Navajo 4 Year Service Discounted in Years 3

- 4 18 Round Trips Per Week

### Ironwood, Michigan

– Cessna Grand Caravan or Piper Navajo

Option 1:

2 Year Service or 4 Year Discounted Service (Discounted in Years 3

- 4)

12 Total Round Trips Per Week

– Based on 97% Completion Rate



## Ironwood, Michigan

– Chicago O’Hare International Airport

– Caravan or Navajo

Operation Revenues

IWD

- ORD Revenues $ 351,900

Other Revenues 0

Total Operating Revenues $ 351,900

Direct Operating Expenses

Flying Operations $ 451,777

Fuel and Oil 627,960

Maintenance 567,733

Aircraft Leases 479,751

Total Direct $2,127,221

Marketing 50,000

Indirect 908,935

Total Operating Expenses $3,086,156

Operating Loss $2,734,256

Profit Element (5% total Oper. Exp.) 154,308

Compensation Required $2,888,564

Compensation per PAX $566

Compensation per Departure $2,379 # Passengers: 5,100
Average Fare: $69.00

Departures: 1,214

Block Hours: 1,874

Revenue Passenger Miles: 1,693,200

Available Seat Miles: 3,215,247

02/05/2014 DISCOUNTED SUBSIDY $2,859,678/Year $2,355/Departure DISCOUNTED FOR YEARS 3

- 4

Representative Schedule

Departure Arrival

IWD 6:00 AM ORD 7 :50 AM

ORD 12 :10 PM IWD 2:00 PM

IWD 3:25 PM ORD 5:15 PM

ORD 7:15 PM IWD 9 :05 PM

### Ironwood, Michigan

– Cessna Grand Caravan or Piper Navajo

Option 2: 2 Year Service or 4 Year Discounted Service (Discounted in Years 3

- 4)

18 Total Round Trips Per Week

– Based on 97% Completion Rate



## Ironwood, Michigan

– Chicago O’Hare International Airport

– Caravan or Navajo

Operation Revenues

IWD

- ORD Revenues $ 558,900

Other Revenues 0

Total Operating Revenues $ 558,900

Direct Operating Expenses

Flying Operations $ 617,872

Fuel and Oil 941,941

Maintenance 809,020

Aircraft Leases 479,750

Total Direct $2,848,583

Marketing 50,000

Indirect 1,027,411

Total Operating Expenses $3,925,994

Operating Loss $3,367,094

Profit Element (5% total Oper . Exp.) 196,300

Compensation Required $3,563,394

Compensation per PAX $440

Compensation per Departure $ 1,956 # Passengers: 8,100
Average Fare: $69.00

Departures: 1,822

Block Hours: 2,811 Revenue Passenger Miles: 2,689,200

Available Seat Miles: 4,822,871

02/05/2014 DISCOUNTED SUBSIDY $3,527,760/Year $1,936/Departure DISCOUNTED FOR YEARS 3

- 4

Representative Schedule

Departure Arrival

IWD 6:00 AM ORD 7 :50 AM

ORD 8 :15 AM IWD 10:05 AM

IWD 11:30 AM ORD 1 :20 PM

ORD 12 :10 PM IWD 2:00 PM

IWD 3:25 PM ORD 5:15 PM

ORD 7:15 PM IWD 9 :05 PM

# Air Choice One Has The Keys

To Your Success

02/05/2014 ALL SEATING FIRST CLASS