## Proposal to Provide Essential Air Service at



# Decatur, Illinois

Docket DOT

- OST

- 2006

- 23929

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

10/11/2011 Air Choice One is grateful to be the current carrier servicing the community of Decatur, Illinois and we are committed to continued growth in Decatur. We have reviewed the order and were disappointed because it describes our performance inaccurately. First, the order says that our subsidy level at Decatur is $331 per passenger. This description ignores the trend showing that we have been steadily reducing the subsidy level for Decatur, so that it has been under $200 since May, 2011. Air Choice One fully expects to meet the targets established two years ago. The Order relies solely on data released by BTS, which gives an inaccurate and unfair picture by not taking into consideration the data reported after June, 2011. The order also incorrectly discounts our achievements and the investments we have made, especially at Decatur where we built the passenger base from the dismal monthly 157 passengers that we inherited in December 2009 to 1,421 in June, 2011. That’s nearly a 1000% increase in just 18 months! Our current proposal allocates substantial resources to support marketing efforts and builds on the momentum we have begun. We will continue working diligently to further increase enplanements.

We understand the efforts of a dedicated air carrier are critical to the continued success of the EAS program in your community. Air Choice One is that air carrier and through our past performance we have demonstrated the strategy outlined in our proposal is successful and guarantees airport development. Our current proposal gives the best access to the national transportation system for the community at reasonable prices and may be considered as an individual offering

.
Air Choice One remains dedicated to providing Decatur with outstanding service and we are seeking your commitment to our partnership through selection of Air Choice One for a 4 year term. The commitment of the Decatur community to a 4 year term provides Air Choice One with the financial justification to move our fleet forward into aircraft with larger seating capacities. Decatur will directly benefit through increased passenger loads; easing the subsidy requirement.

We look forward to serving you for the next 4 years!

# Market Growth Strategy

- Airport Partnerships

Air Choice One will team with your local airport to raise awareness about your communities’ air service and increase enplanements.

• LOCAL AIRPORT INITIATIVES

• Educate the Community about the EAS Program and Air Choice One’s Service

• Assist with Arranging Local Promotions, Media Access, and Service Clubs

• High Visibility on Website and Signage

• Draft and Distribute Press Releases

• Community Involvement

• Participate in TV and Radio Coverage

• Distribute Information Pertaining to Air Choice One at Local Business Events

• High Visibility Presence on City Website(s) and Electronic Signage

• Provide Financial Support through Rental Agreements

• Provide Telephone and Internet Service

10/11/2011

# Market Growth Strategy

- Airport Partnerships

Air Choice One will team with your chosen destination airport to promote tourism opportunities and encourage air travel to your community, again, increasing enplanements.

• CHICAGO O’HARE INTERNATIONAL AIRPORT (ORD) INITIATIVES

• EAS Communities Receiving Reliable Service to Hub Airports Have Benefited From a Steady Increase in Ridership

• Market Vacation Packages to ORD and Beyond and to Local Communities From ORD

• Air Choice One Operates from Terminal 3, Gate L9



### • LAMBERT ST. LOUIS INTERNATIONAL AIRPORT (STL) INITIATIVES

• Aggressively pursuing EAS Communities Through Partnership Programs

• Local Visits and Financial Support

• Annual EAS Summit Held at STL Airport

• STL Currently Supports Over 50 Daily Flights to Seven EAS Communities

• EAS Communities Partnering With STL Have Benefited From a Steady Increase in Ridership

• Provide Marketing Funds to Both Air Choice One and the Local Community

• Market Vacation Packages to STL and Beyond and to Local Communities From STL

• Expedited Security Passes

— Passengers With Connections Enter Security Through First/Business Class Line

• Discount Coupons for Airport Shopping and Concessions

10/11/2011

# Market Growth Strategy

–

Partnering With the Community

10/11/2011 

### Air Choice One is dedicated to working with your community to reinvigorate the service at your airport and sustain growth that will launch us into the future.

• WE ARE YOUR NEIGHBORS



### • Corporate Headquarters in Midwest

• Increase Local Career Opportunities

• WE ARE IN YOUR COMMUNITY

• Routine On

- Site Sales Visits

• Chamber of Commerce Participation and Membership



### • Airport Affiliate Participation

• STRONG PUBLIC RELATIONS AND MEDIA OUTREACH

• Business Incentive Programs

• Travel Agent Discounts

• Business to Business Communication



### • Attendance at Public Events

• WE KEEP YOU INFORMED

• Monthly Airport Board Updates

# Market Growth Strategy

– Marketing Investment

10/11/2011 

### Air Choice One reinvests in our served communities.

• TRADITIONAL MEDIA

• Radio

- Talk Shows/Commercials

• TV Commercials and Event Coverage

• Print

- Newspaper/Magazines

• Billboards

• Web Based

– E

- Blasts

- Constant Contact

– Monthly E

- Mail Promotions

– City Representation on Our Website



### • SOCIAL MEDIA

• Twitter, Facebook, Linked In

• INTERACTIVE MEDIA

• Contests

• You Tube/Videos

• EVENTS AND SPONSORSHIPS

• Local Charitable Support

- March of Dimes, Make

- A

- Wish Foundation, Red Cross, etc.

• Business/Community Support

- Golf Tournaments, Business Luncheons, Air Shows, etc.

• COMMUNITY TICKET OFFICE

# Market Growth Strategy

– Reliability & Growth

• CONSISTENT SERVICE IS KEY

• Proven Success in Other EAS Markets

• Builds Passenger Confidence in Carrier

• Dedicated Aircraft for your Airport

– 102% Flight Completion Ratio as Reported by DOT YR 2010

– Spare Aircraft Availability



## • AIR CHOICE ONE’S REVENUE INCREASED BY OVER 20% YE 2010 VS. 2009

10/11/2011 

### 75 80 85 90 95 100 105

Cape
Air Am. Eagle Gr.
Lakes Sea
Port Air
Choice Completion %



# Airline Airline Completion Ratios

Works Cited: T

- 100 Segment Report DOT 2010 Calendar Year

# Market Growth Strategy

– Accessibility

• VISIBILITY

• Global Distribution Systems

– Sabre , Apollo, Worldspan, Travelport, Amadeus, etc.

• Consumer Sites

– Expedia, Travelocity, Priceline, Orbitz, etc.

• Web based booking



### – www.airchoiceone.com

• Call Center

– Open 7 Days a Week



## • CONNECTIVITY

• United Airlines Agreement

• Additional Legacy Agreements Pending

10/11/2011

# Market Growth Strategy

– Pricing

Air Choice One offers the right price for the right ticket at the right time.

We take all things into consideration and enter the market with low fares. We work hard to establish a winning price point through targeted market analysis. We believe consistent pricing builds consumer confidence.

• BUILDING & SUSTAINING RIDERSHIP THROUGH PRICE

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



### • On

- Going Affordable Fares = Full Planes!

• Full Planes Establish the Customer Base Needed to Reduce Future Subsidy Requirements

10/11/2011 *Numbers Reflect O & D 

## 0 500 1,000 1,500 2,000 

## 2,500 3,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec # of Passengers

Month of Service 

## Air Choice One Ridership Growth EAS Markets 2010

- 2011*

2010

2011

# Marketing Growth Strategy

-

New Hub, New Opportunities

ST. LOUIS’ COMBO OF LOW FARE CARRIERS AND ENDLESS CONNECTIONS AR E THE

KEY TO 

# SELLING MORE TICKETS!

10/11/2011 *Source : Southwest Airlines Website, September 2011, 14 Day Advance Purchase 

## • Air Choice One Operates from Gate E33, Terminal 2

• 244 Daily Flights to 60 Domestic & International Markets as of August,
2011.

• More than 24,700 Daily Outbound
Seats. Terminal 2, Gate E33

# Marketing Growth Strategy

-

Building On A Great Foundation

AIR CHOICE ONE WILL 

# BUILD ON CHICAGO O’HARE INTERNATIONAL’S 

# MOMENTUM !

10/11/2011 

### Terminal 3, Gate L9

• Air Choice One Operates from Terminal 2, Gate L9

• 39 Carriers Serving Over 67 Million Passengers and More Than 950,000 Aircraft Operations in 2010

# Options Index Decatur, Illinois

10/11/2011 OPTION 1, 2 YEAR SERVICE WITH DISCOUNT FOR 4 YEAR SERVICE TERM

– STL & ORD SERVICE
CESSNA GRAND CARAVAN

Decatur, Illinois

– Dual Hub Service

– Lambert St. Louis & Chicago O’Hare International Airports

Cessna Grand Caravan 36 Round Trips Per Week

OPTION 2
, 2 YEAR SERVICE WITH DISCOUNT FOR 4 YEAR SERVICE TERM

– STL & ORD SERVICE
CESSNA GRAND CARAVAN

Decatur, Illinois

– Dual Hub Service

– Lambert St. Louis & Chicago O’Hare International Airports

Cessna Grand Caravan 36 Round Trips Per Week

OPTION 3
, 2 YEAR SERVICE WITH DISCOUNT FOR 4 YEAR SERVICE TERM

– STL SERVICE
CESSNA GRAND CARAVAN

Decatur, Illinois

– Lambert St. Louis International Airport

Cessna Grand Caravan 36 Round Trips Per Week

OPTION 4
, 2 YEAR SERVICE WITH DISCOUNT FOR 4 YEAR SERVICE TERM

– ORD SERVICE
CESSNA GRAND CARAVAN

Decatur, Illinois

– Chicago O’Hare International Airport

Cessna Grand Caravan 36 Round Trips Per WeekOperation Revenues

DEC

- STL & DEC

- ORD Revenues $ 842,550

Other Revenues 8,426 Total Operating Revenues $ 850,976

Direct Operating Expenses Flying Operations $ 468,730

Fuel and Oil 880,041

Maintenance 703,095

Aircraft Leases 420,000

Total Direct $2,471,866
Marketing 60,000

Indirect 898,049

Total Operating Expenses $3,429,915

Operating Loss $2,578,939
Profit Element (5% total Oper. Exp.) 171,496 Compensation Required $2,750,435

Compensation per PAX $167
Compensation per Departure $748 

## Decatur, Illinois

– Dual Hub Service

– Cessna Grand Caravan

Option 1: 2 Year Service With Discount For 4 Year Service Term

36 Total Round Trips Per Week

– Based on 98% Completion Rate

Decatur, Illinois

– Dual Hub Service

– Lambert St. Louis & Chicago O’Hare International Airports

– Caravan

# Passengers: 16,450 Average Fare

- ORD: $59.00 Average Fare

– STL: $49.00 Departures: 3,680 Block Hours: 3,348 Revenue Passenger Miles: 2,665,650 Available Seat Miles: 5,498,176

10/11/2011 Representative Schedule (3S/3C)

Departure Arrival

DEC @ 6:00 AM CT ORD @ 7:05 AM CT

ORD @ 7:55 AM CT DEC @ 9:00 AM CT

DEC @ 9:30 AM CT STL @ 10:10 AM CT

STL @ 10:40 AM CT DEC @ 11:20 AM CT

DEC @ 11:45 AM CT ORD @ 12:50 PM CT

ORD @ 1:20 PM CT DEC @ 2:25 PM CT

DEC @ 2:45 PM CT STL @ 3:25 PM CT

STL @ 4:00 PM CT DEC @ 4:40 PM CT

DEC @ 5:00 PM CT ORD @ 6:05 PM CT

ORD @ 6:35 PM CT DEC @ 7:40 PM CT

DEC @ 8:00 PM CT STL @ 8 :40 PM CT

STL @ 9:10 PM CT DEC @ 9:50 PM CT

DISCOUNTED SUBSIDY $ 2,667,922/Year $726/Departure DISCOUNT FOR 4

- YEAR TERMOperation Revenues

DEC

- STL & DEC

- ORD Revenues $ 902,550

Other Revenues 9,026 Total Operating Revenues $ 911,576

Direct Operating Expenses Flying Operations $ 432,674

Fuel and Oil 947,736

Maintenance 757,179

Aircraft Leases 420,000

Total Direct $2,557,589
Marketing 60,000

Indirect 897,153

Total Operating Expenses $3,514,742

Operating Loss $2,603,167
Profit Element (5% total Oper. Exp.) 175,737 Compensation Required $2,778,904

Compensation per PAX $169
Compensation per Departure $755 

## Decatur, Illinois

– Dual Hub Service

– Cessna Grand Caravan

Option 2: 2 Year Service With Discount For 4 Year Service Term

36 Total Round Trips Per Week

– Based on 98% Completion Rate

Decatur, Illinois

– Dual Hub Service

– Lambert St. Louis & Chicago O’Hare International Airports

– Caravan

# Passengers: 16,450 Average Fare

- ORD: $59.00 Average Fare

– STL: $49.00 Departures: 3,679 Block Hours: 3,605 Revenue Passenger Miles: 2,899,950 Available Seat Miles: 6,120,093

10/11/2011 DISCOUNTED SUBSIDY $ 2,695,537/Year $732/Departure DISCOUNT FOR 4

- YEAR TERM Representative Schedule (2S/4C)

Departure Arrival

DEC @ 6:00 AM CT ORD @ 7:05 AM CT

ORD @ 7:55 AM CT DEC @ 9:00 AM CT

DEC @ 9:30 AM CT STL @ 10:10 AM CT

STL @ 10:40 AM CT DEC @ 11:20 AM CT

DEC @ 11:35 AM CT ORD @ 12:40 PM CT

ORD @ 1:10 PM CT DEC @ 2:15 PM CT

DEC @ 2:45 PM CT ORD @ 3:50 PM CT

ORD @ 4:20 PM CT DEC @ 5:25 PM CT

DEC @ 6:00 PM CT STL @ 6 :40 PM CT

STL @ 7:00 PM CT DEC @ 7:40 PM CT

DEC @ 8:00 PM CT ORD @ 9:05 PM CT

ORD @ 9:35 PM CT DEC @ 10:40 PM CTOperation Revenues

DEC

- STL Revenues $ 754,600

Other Revenues 7,546 Total Operating Revenues $ 762,146

Direct Operating Expenses Flying Operations $ 347,684

Fuel and Oil 676,954

Maintenance 589,777

Aircraft Leases 420,000

Total Direct $2,034,415
Marketing 60,000

Indirect 810,652

Total Operating Expenses $2,905,067

Operating Loss $2,142,921
Profit Element (5% total Oper. Exp.) 145,253 Compensation Required $2,288,174

Compensation per PAX $149
Compensation per Departure $622 

## Decatur, Illinois

– Cessna Grand Caravan

Option 3: 2 Year Service With Discount For 4 Year Service Term

36 Total Round Trips Per Week

– Based on 98% Completion Rate



## Decatur, Illinois

– Lambert St. Louis International Airport

– Caravan
# Passengers: 15,400 Average Fare: $49.00 Departures: 3,679 Block Hours: 2,575 Revenue Passenger Miles: 1,694,000 Available Seat Miles: 3,632,429

10/11/2011 DISCOUNTED SUBSIDY $ 2,219,529/Year $603/Departure DISCOUNT FOR 4

- YEAR TERM Representative Schedule (6S)

Departure Arrival

DEC @ 6:00 AM CT STL @ 6:40 AM CT

STL @ 7:25 AM CT DEC @ 8:05 AM CT

DEC @ 8:50 AM CT STL @ 9:30 AM CT

STL @ 10:15 AM CT DEC @ 10:55 AM CT

DEC @ 11:40 AM CT STL @ 12:20 PM CT

STL @ 1:05 PM CT DEC @ 1:45 PM CT

DEC @ 2:30 PM CT STL @ 3:10 PM CT

STL @ 3:55 PM CT DEC @ 4:35 PM CT

DEC @ 5:20 PM CT STL @ 6:00 PM CT

STL @ 6:45 PM CT DEC @ 7:25 PM CT

DEC @ 8:05 PM CT STL @ 8:45 PM CT

STL @ 9:35 PM CT DEC @ 10 :15 PM CTOperation Revenues

DEC

- ORD Revenues $ 970,550

Other Revenues 9,706 Total Operating Revenues $ 980,256

Direct Operating Expenses Flying Operations $ 453,277

Fuel and Oil 1,062,111

Maintenance 824,142

Aircraft Leases 420,000

Total Direct $2,759,530
Marketing 60,000

Indirect 832,965

Total Operating Expenses $3,652,495

Operating Loss $2,672,239
Profit Element (5% total Oper. Exp.) 182,625 Compensation Required $2,854,864

Compensation per PAX $174
Compensation per Departure $776 

## Decatur, Illinois

– Cessna Grand Caravan

Option 4: 2 Year Service With Discount For 4 Year Service Term

36 Total Round Trips Per Week

– Based on 98% Completion Rate



## Decatur, Illinois

– Chicago O’Hare International Airport

– Caravan
# Passengers: 16,450 Average Fare: $59.00 Departures: 3,679 Block Hours: 4,121 Revenue Passenger Miles: 3,668,350 Available Seat Miles: 7,363,924

10/11/2011 DISCOUNTED SUBSIDY $ 2,769,218/Year $753/Departure DISCOUNT FOR 4

- YEAR TERM Representative Schedule (6C)

Departure Arrival

DEC @ 6:00 AM CT 0RD @ 7:05 AM CT

0RD @ 7:50 AM CT DEC @ 8:55 AM CT

DEC @ 9:40 AM CT ORD @ 10:45 AM CT

0RD @ 11:30 AM CT DEC @ 12:35 PM CT

DEC @ 1:20 PM CT ORD @ 2:25 PM CT

ORD @ 3:10 PM CT DEC @ 4:15 PM CT

ORD @ 2:00 PM CT DEC @ 3:05 PM CT

DEC @ 3:50 PM CT ORD @ 4:55 PM CT

DEC @ 5:30 PM CT ORD @ 6:35 PM CT

ORD @ 8:00 PM CT DEC @ 9:05 PM CT

ORD @ 5:40 PM CT DEC @ 6:45 PM CT

DEC @ 7:30 PM CT ORD @ 8 :35 PM CT

# The Best Choice to Succeed

10/11/2011 

## • Proven Enplanement Increases in EAS Markets

• Successful Pricing Strategy

• Demonstrated Growth in Community Support

• Proven Reliability

• Outstanding Completion Ratio

• Great Hub Connectivity



## • Successful Marketing and Public Relations Outreach

• Raise Awareness About Local Air Service

• We Cater to Community and Business Needs



# We Look Forward to Serving Decatur for the Next 4 Years!