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BEFORE THE:" C?~;:.;"i,:';,.S

DEPARTMENT OF TRANSPORTATI~N"] '.~C I i A S: 31

WASHINGTON, DC

Essential Air Service at

GARDEN CITY, KANSAS

Under 49 U.S.C 941731 et seq.

DOT-OST-1998-3503

AMERICAN AIRLINES PROPOSAL TO PROVIDE ESSENTIAL AIR SERVICE AT

GARDEN CITY, KANSAS

American Airlines, a wholly owned subsidiary of AMR Corporation, respectfully submits its

proposal to continue subsidized Essential Air Service to Garden City, Kansas. American Airlines

seeks to continue service from American's largest hub, Dallas/Fort Worth International Airport

("DFW"), to the Garden City Regional Airport ("GCK"), with two daily roundtrips. The service

would be operated by the American Airlines regional brand, American Eagle using 50 seat jet

aircraft.

American Airlines regional feed is operated under the American Eagle and American Connection

brands. American Airlines customers have access to more than 2~0 cities, 40 countries and more

than 3400 daily departures. Through our oneworld alliance, customers have access to more than

700 destinations and 140 countries. These flights will continue to be operated with the AA code,

pursuant to a codesharing agreement with American Airlines. Additional codes of the oneworld

carriers are also applied to this route, and would continue to be.

The service proposed by American Airlines continues existing service to American's largest hub,

Dallas/Fort Worth International Airport. At DFW, American and American Eagle offer more

than 800 daily departures to over 160 destinations, making it one of the largest hubs in the

country. This direct access to so many places has helped stimulate traffic from Garden City with

significantly easier connecting options than what had been offered to Garden City travelers prior

to our award of the current Essential Air Service bid.

Garden City has performed well under subsidized Essential Air Service since American's EAS

subsidy award in April 2012. Passenger numbers increased from just over 10,380 in 2011, to

more than 17,500 in just one year. We have made great progress in developing air-service in

Garden City, bringing new business and industry to the Southwest Kansas region. Our current

bid should reflect our belief that the Essential Air Service subsidy is vital, as the market is on a

trajectory to one day be self-sustaining.
".

American would like to also request that the DOT and Garden City allow us flexibility in

substituting a Bombardier CRJ200 (50 seats) aircraft and Embraer Regional jets when needed for

the same rates. Allowing us to substitute 44- or 50-seat RJs will provide us the flexibility to

match supply with demand, as well as provide operational flexibility, which will improve

reliability. American also requests that the DOT and Garden City waive the right to hold-in

American Airlines service upon issuance of 120 days-notice to terminate service. Although we

do not foresee this to be an issue and plan to continue developing the Garden City market, we

cannot be operationally constrained and kept in a market indefinitely, without ability to adapt to

changing circumstances.

We believe that our to-date success in Garden City is demonstrative of the American Airlines

network and marketing programs. American Airlines is the only airline with a dedicated

Regional Partnerships group that will continue its promotion of the brand and service in Garden

City.

We look forward to serving the Garden City area for many years to come and appreciate the

community's and the Department of Transportation's consideration of continued American

Airlines service.

Sincerely,

Charles Schubert

Vice President

American Airlines Network Planning
..•..

Market:

Aircraft

Garden City. KS to Dallas Fort Worth

Mileage

Annual Deps (Factored)

Block per Dep

Annual Block Hours

(Factored)

Completion Percentage

Revenues

Annual Passengers

Avg Fare - Onboard

Total Revenues

Expenses

Flight Operations (incl Fuel)

Aircraft Ownership

Pax Variable

Other

Total Expenses

. Profit I (Loss)

Profit Element (@ 5%)

404

1,431

1.50

2,146

98.0%

46,866

$119

$5,578,214

$5,365,626

$285,269

$667,031

$371,012

$6,688,939

($1,110,725)

$334,447

Number of Seats per Dep

Annual ASMs (Factored)

Annual RPMs (Factored)

Annual LF

50

28,902,160

18,555,187

64.2%

Subsidy Required

Subsidy I Departure

Subsidv I Pax

$1,445,172

$1,010

$30.84

Previous Subsidy $2,919,026

Previous I Departure $2,040

Previous I Pax

Proposed Schedule

Seqment Depart Arrive Frequency

GCK-DFW 6:15 7:45 Daily

GCK-DFW 15:25 16:55 Daily

DFW-GCK 13:20 14:55 Daily

DFW-GCK 19:40 21:15 Daily

• Schedule is shown for illustrative purposes only and American Airlines reserves the right to change without notice.