# History BOUTIQUEAIR 340PineStreet,Suite503 SanFrancisco,CA

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Carlsbad's first Essential Air Service (EAS) determination was given in Order 84-10-10. That order calls for a minimum service level of 54 inbound and 54 outbound seats when the community is served with aircraftthat havefewerthan 15 seats. Furthermore, while 47 U.S.C. 41733(e) allows the Secretary to review and adjust the level of service at EAS communities, it specifically prohibits lowering the level of service below the original determination
- in this case, the determination set by Order84-10-10. As such, it is our opinion that Carlsbad, NM is entitled to, and should receive, a level ofservice commensurate with its original determination. To that end, we propose as Option 3 a scenario thatfulfills the Department's expectations, but also provided an option forwhatwe believe to be the correct level ofservice in Option 1. 

# About Boutique Air Boutique Air (formerly Shasta Flyers Aviation) has been in operation since 2007. We began by flying air attack missions for the U.S. Forestry Department. In addition to that, we now provide charter service out ofVan Nuys, CA with our PC-12. While providing charter services we have received certification from both ARG/US and Wyvern, passing stringent due diligence checks for operatorsafety. We have also worked to develop our distribution channels. We have connections in place with all of the major Global Distribution Systems (GDSs), which travel agents use to access the market. You'll find us on Worldspan and Apollo (Travelport), Sabre, and Amadeus. In addition, we are on the major Online Travel Agencies (OTAs). This includes Expedia, Travelocity, Priceline, and Cheap0Air. 1 We also have our direct channels, such as our website and call center - which will be staffed by Carlsbad locals. We intend to keep two aircraft (under either Option 1 or 2) overnight at CNM. That means we'll be also be doing maintenance in Carlsbad, providing reliable morning departures and allowing easier connections in Albuquerque or Dallas.

1We have signed an agreementwith Orbitz and CheapTickets, and expectthatto be live in February.BOUTIQUEAIR 340PineStreet,Suite503 SanFrancisco,CA

t.415-449-0505 f. 415-738.7671 Of course, we'll also be hiring a local station manager and customer service agents to ensure Carlsbad locals getthe support and attention they expect and deserve. We will be active in the community--participating in the Chamber ofCommerce, local businesses, charities, and events. 

# Our Policies At Boutique Air, we have a different philosophy than most carriers. For one thing, you're going to have to look pretty hard to find fees. We don't charge change fees, we don't charge unaccompanied minorfees, we don't charge petfees, and we don'tcharge baggage fees. In fact, our baggage policy couldn't be simpler. Each guest can bring 40 pounds of baggage. If you have more than that, we'll accommodate it ifwe can - no extra charge. Ifyou know you'll have extra baggage and you want to be sure there's room, we'll let you send it on an earlier flight and hold it atyourdestination until you getthere. 

# Proposal Our proposal consists of three different options for Carlsbad. All options would be flown in nine-seat Pilatus PC-12 aircraft. These aircraft are pressurized, and are much faster than the Cessna Caravan, which is the current aircraft serving Carlsbad. This will provide a quicker, more comfortable trip. It should be noted that we firmly believe that the two hub service will increase Carlsbad's traffic significantly. This proven method has been used in other EAS communities a number oftimes. 2 One way we intend to increase passenger counts is by recapturing traffic that has leaked to Roswell to fly to DFW. With our projected fares to Dallas ranging from $69 to $129, we will be significantly more economical than flying out ofRoswell.3 For flights to Albuquerque, we are projecting fares ranging from $49 to $99. From time to time wewill also have sales on both routes to increase both awareness and passenger counts.

2 BRL, DEC, ELD, HOT, and HRO are all examples of EAS communities where traffic has increased under nine-passengercarriers flying totwo hubs. 3 Currently the lowest fare from Roswell to DFW is $159 and requires a 21-day advance purchase. The lowestwalk-up fare is $280.BOUTIQUEAIR 340PineStreet,Suite503 SanFrancisco,CA

t. 415-449.0505 f. 415-738-7671 Each option is being proposed as eitheratwo orfouryear contract. Option 1 would provide the full level of service the community is entitled to, consisting of 24 weekly round tripstoAlbuquerque, NM and 12weekly round trips to Dallas, TX. Option 2 is something of a compromise between the current level of service and the entitled level ofservice. It consists of 12 weekly round trips to Albuquerque, NM and 12 weekly round tripsto Dallas, TX. Finally, Option 3 offers service at the level requested by the DOT, providing 12 weekly round trips to Dallas, TX. 

# Community Input We have spoken with the airport manager and the mayor's office in order to determine what the preferences of the community are. Some suggestions we were able to accomodate (such as staffing the airport during flights for passenger assistance) and some we were not (more intrastate destinations, for example). While we can't promise we'll be able to implement everyone's suggestions, we welcome feedback from the citizens of Eddy County, as well as anyone who may have an interest in the proposed flights. What we can promise is that we'll listen to your feedback, and give it the attention and consideration it deserves. We also encourage everyone to let the DOT knowwhich proposal you like best (even if it's not ours) by commenting on the bid. Go to boutiqueair.com/CNM to send your comments directlyto the DOT. With respect and appreciation, Shawn Simpson CEOBOUTIQUEAIR 340PineStreet,Suite503 SanFrancisco,CA

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# Option 1 - Bid 12 Origin CNM DFW CNM ABQ Destination DFW CNM ABQ CNM Operations Flights 624 624 1,248 1,248 Block Hours 1,140 1,140 1,368 1,368 Seats 5,616 5,616 11,232 11,232 ASMs 2,369,952 2,369,952 2,594,592 2,594,592 Revenue Passengers 2,500 2,500 3,483 3,483 Average Fare $87.21 $87.21 $62.33 $62.33 Load Factor 44.52% 44.52% 31.01% 31.01% Fare Revenue $218,023.26 $218,023.26 $217,046.81 $217,046.81 Ancillaries $1,250.00 $1,250.00 $0.00 $0.00 Total Revenue $219,273.26 $219,273.26 $217,046.81 $217,046.81 Expenses Fuel $404,700.00 $404,700.00 $485,640.00 $485,640.00 Aircraft Expense $167,797.75 $167,797.75 $201 ,357.30 $201,357.30 Maintenance and Reserves $262,200.00 $262,200.00 $314,640.00 $314,640.00 Staff $185,475.00 $185,475.00 $184,870.00 $184,870.00 Marketing and Distribution $10,000.00 $10,000.00 $13,930.00 $13,930.00 Other Indirect Costs $62,898.41 $36,750.00 $44,933.35 $13,541.16 Total Costs $1,093,071.16 $1,066,922.75 $1,245,370.66 $1,213,978.46

Route Profitor Loss $54,653.56 $53,346.14 $62,268.53 $60,698.92 Margin 5.00% 5.00% 5.00% 5.00% Subsidy $928,451.46 $900,995.63 $1,090,592.38 $1,057,630.57 Total Subsidy $3,977,670BOUTIQUEAIR 340PineStreet,Suite503 SanFrancisco,CA

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# Option 1 - Schedule 12

Depart Arrive Service Days Depart 6:00am 7:06am Monday
- Friday 7:21am 8:42am 9:48am Everyday 10:03 am 11:52 am 12:58 pm Monday
- Friday 2:13pm 3:34pm 4:40pm Everyday 5:35pm

Depart Arrive Service Days Depart 5:00am 7:50am Monday
- Saturday 10:47 am 11:24 am 2:14pm Sunday- Monday 6:02pm 

### to Arrive Service Days 8:27am Monday
- Friday 11:09 am Everyday 3:19pm Monday
- Friday 6:41pm Everyday

Arrive Service Days 11:37 am Monday
- Saturday 6:52pm Sunday
- Monday
These schedules are representative ofwhatthe final schedules may be. Final schedules will be determined after more community input has been gathered.

# Option 2 - Bid 12
Origin Destination Operations Flights Block Hours Seats ASMs Revenue Passengers Average Fare Load Factor Fare Revenue Ancillaries Total Revenue Expenses Fuel Aircraft Expense Maintenance and Reserves Staff Marketing and Distribution Other Indirect Costs Total Costs Route Profitor Loss Margin Subsidy Total Subsidy BOUTIQUEAIR 340PineStreet,Suite503 SanFrancisco,CA

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## 2

CNM DFW DFW CNM

624 624 1,140 1,140 5,616 5,616 2,369,952 2,369,952
2,500 2,500 $87.00 $87.00 44.52% 44.52% $218,023.00 $218,023.00 $1,250.00 $1,250.00 $219,273.26 $219,273.26
$404,700.00 $404,700.00 $199,785.95 $199,785.95 $262,200.00 $262,200.00 $185,475.00 $185,475.00

$10,000.00 $10,000.00 $62,148.41 $36,000.00 $1'124,309.36 $1,098,160.95 $56,215.47 $54,908.05 5.00% 5.00% $961,251.57 $933,795.75 $2,965,492 CNM ABQ ABQ CNM

624 624 684 684 5,616 5,616 1,297,296 1,297,296
2,786 2,786 $62.33 $62.33 49.61% 49.61% $173,637.00 $173,637.00 $0.00 $0.00 $173,637.45 $173,637.45
$242,820.00 $242,820.00 $119,871.57 $119,871.57 $157,320.00 $157,320.00 $123,310.00 $123,310.00

$11'144.00 $11,144.00 $28,487.26 $12,791.16 $682,952.83 $667,256.73

$34,147.64 $33,362.84 5.00% 5.00% $543,463.02 $526,982.12BOUTIQUEAIR 340PineStreet,Suite503 SanFrancisco,CA

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# Option 2 - Schedules 1 2

Depart Arrive Service Days Depart 6:00am 7:06am Monday
- Saturday 7:21am 3:34pm 4:40pm Sunday
- Monday 5:35pm

From Depart Arrive Service Days Depart 5:00am 7:50am Monday
- Saturday 10:47 am 11:24 am 2:14pm Sunday- Monday 6:02pm 

### to Arrive Service Days 8:27am Monday
- Saturday 6:41pm Sunday
- Monday

Arrive Service Days 11:37 am Monday- Saturday 6:52pm Sunday
- Monday
These schedules are representative ofwhatthe final schedules may be. Final schedules will be determined after more community input has been gathered.

# Option 3 - Bid 12 W@'l!eK
Origin Destination Operations Flights Block Hours Seats ASMs Revenue Passengers Average Fare Load Factor Fare Revenue Ancillaries Total Revenue Expenses Fuel Aircraft Expense Maintenance and Reserves Staff Marketing and Distribution Other IndirectCosts Total Costs

Route Profit or Loss Margin Subsidy Total Subsidy BOUTIQUEAIR 340PineStreet,Suite503 SanFrancisco,CA

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CNM DFW

624 1,140 5,616 2,369,952
2,750 $87.21 48.97% $239,825.58 $1,375.00 $241,200.58
$404,700.00 $246,842.98 $262,200.00 $199,275.00

$11,000.00 $67,248.41 DFW CNM

624 1,140 5,616 2,369,952
2,750 $87.21 48.97% $239,825.58 $1,375.00 $241,200.58
$404,700.00 $246,842.98 $262,200.00 $199,275.00

$11,000.00 $41,100.00 $1'191,266.38 $1'165,117.98
$59,563.32 $58,255.90 5.00% 5.00% $1,009,629.12 $982,173.29 $1,991,802BOUTIQUEAIR 340PineStreet,Suite503 SanFrancisco,CA

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# Option 3 - Schedules 12 Vii!PII"H

Depart Arrive Service Days Depart 5:00am 7:50am Monday
- Saturday 10:47 am 11:24 am 2:14pm Sunday
- Monday 6:02pm Arrive Service Days 11:37 am Monday
- Saturday 6:52pm Sunday- Monday
These schedules are representative ofwhatthe final schedules may be. Final schedules will be determined after more community input has been gathered.