::o .. ··--. 

BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

WASHINGTON, D.C. 

Essential Air Service ~•t 

ADAK, ALASKA 

under .t9 U.S.C. § 4 I 731 et. seq. 

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Docket OST -2000-8556 

PnOPOSAL OF EnA AVIATION INC. 

TO PROVIDE ESSENTIAL AIR SERVICE 

AT AI>AK, ALASKA 

Communications with respect to this document should be addressed to: 

James Hajdukovich 

Robert Hajdukovich 

Era Aviation Inc. 

4700 Old Internatiomil Airport Road 

Anchorage, AK 99502 

Jul)' 24, 2012 

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BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

WASHINGTON, D.C. 

Essential Air Service at 

' . 

ADAK, ALASKA 

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) 

) 

) 

) 

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Docket OST -2000-8556 

... under 49 U.S.C. § 41731 et. seq. .July 24, 2012 

PROPOSAL OF ERA AVIATION INC. 

TO PROVIDE ESSENTIAL AIR SERVICE 

AT ADAK, ALASKA 

Pcrsuant to DOT Order 2012-2-8. Era Aviation. Inc. hereby presents its proposal 

to provide subsidized essential air service (''EAS") to Adak, Alaska. for a two year period 

beginning August I, 20 12. 

l. Era Aviation Adak EAS Proposal 

Era Aviation proposes to provide 108 roundtrip t1ights between Adak 

and Anchorage using Era's 3 7-passenger deHavilland Dash 8 that will afford customers a 

level of safe, all weather access to their community. Era's proposal would require an 

annual subsidy of$ 2,208,808.36. See Exhibit and Notes. 

Era's 37 seat dcHavilland Dash 8 aircraft is appropriately sized for the ;\dak 

market. The Dash 8 aircraft offers stand-up cabin, leather seating, full lavatory, tlight 

attendant service, and substantial baggage capacity. The Dash 8 aircraft could offer 7696 

seats with 2 day a week service for the Adak market. TI1e Adak market is estimated to 

have 3000 total passengers annually. 

The reduced frequency (2 tlights weekly) is offered in hopes that a large capacity 

cargo carrier could provide substantial Cargo and Mail service. Everts Air Cargo has 

been contacted and the DC-9-33 aircraft with an average payload ofJO,OOO pounds could 

be operated into the Adak market. Cargo and Mail is estimated at 450,000 pounds 

annually into Adak and 200.000 pounds out ofAdak. 18 flights with a payload of25.000 

cargo amlmail would provide adequate cargo and mail .service neeueJ for the Adak 

mark d. 

Era /\vlation's entire scheduled operation is conducted under Federal Aviation 

Regulation (fAR) Part 1:21 ~the highest safety and regulatory standard tt1r scheduled 
airlines. Era has an excellent safety record and a strong record of regulatory compliance 

with the Federal Aviation Administration (FAA). Era e1~joys a positive relationship with 

the F.'\A at the local, regional, and national levels. 

Era Aviation has a long-standing marketing relationship with Alaska Airlines and 

is part or the Era Alaska network of carriers. The Era Alaska family is now proud to otfer 

scheduled service to more than 100 communities statewide. 

II. Carrier Selection Fac!Qrf! 

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Largest Payload Passenger Aircraft offered by all current proposals . 

Era Aviation can operate I 9 seat aircraft along \Vith 37 seat aircraft 

capable of providing sen ice into Adak. 

Passenger Preference Operation for the community of Adak 

Ability to Remain qv~::r-Night (RON) with aircraft in Adak and Cold Bay . 

Providing over 62 years of Aviation Services in the State of .\Iaska . 

ln conclusion, Era Aviation requests that the Department select it to be the subsidized 

passenger essential air service carrier at Adak, Alaska, for a two-year period. Era 

Aviation also requests that the department consider selecting a subsidized cargo only 

catTier for cargo and mail. which is essential to the community qf Adak. 

Sincerely, 

.-, 

) rV r--:::?f-- ·-~---

ames I Iajdukm ich 

Vice President Finance 

rra Aviation Inc. 

4700 Old international Airport Road 

Anchorage, AK 99502 

(907) 450-7247 
Notes to Era Aviation Inc.EAS subsidv Proposal 

Note 1: Mail and Freight revenues were excluded from our revenue estimates 

because our proposal relies on a joint approach to meeting the community passenger, 

mail and freight needs. While the Dash 8 can carry a significant amount of mail and 

freight in the cargo compartment. we anticipate most of the "passenger plane" cargo to he 

priority 1naiL ex~.:ess bags and priority freight. 

After l\\<O years of providing this service~ \Ve \Vould be better positiom:d to 

estimate hmv much Mail and cargo could be expected to be transported on the passenger 

ship. Mail is also specifically excluded because of the lack of mandate to transport the 

mail on the prevailing EAS provider. Because the Postal Sen il:e has the latitude to 

transport the mail as they see fit, it can't be relied upon as a revenue stream for this 

particular projection. 

Note 2: Era !\ viation wi 11 require a refuding tech stop at Cold Bay (CDB) on the 

·Anchorage to Adak flight. There \vill be no local ANC-CDB traffic on the tlight 

servicing Adak. 

Note 3: Era t\viation estimates average revenue per passenger of$ 393.00 (net oftaxes) 

for the ANC-ADK market. 

Note 4: The Price of fuel has increased in the past two years. Era's fuel expense is based 

on current fuel prices of $3.50 (Anchorage) and $6.69 (Adak and Cold Ba:y.) A \erage 

fuel price of $5 .I 0. Block fuel bum per hour of 160 gallons and block t1 i g.ht time of 9 .S. 

816.00 per block hour fuel cost. 

Note 5: The ··extru crew member'' includes estimated pay/training for an additional 

Captain to meet 14 CFR Section 117.11. · · ~ 

Note 6: The "extra mx crew member'' includes estimated pay/training for A & P 

mechanic to travel on board the 1\NC-CDB-!\DK-i\NC flight. 
Aircraft dcHavilland Dash 8-106 Passenger Aircraft Only- 9 Monthly 

/\NC/CDB//\DK/ANC 

Passenger 

Distance 

Passengers 

Payload 

. Monthly Round Trips 

Annual flights 

Annual Departures 

Block lime 

8 lock Hours 

Passenger 

Anchorage-Adak· 

Adak-Anchorage 

Freight 

Anchorage-Adak 

Adak -Anchorage 

Mail 

Anchorage-t\dak 

Adak-Anchorage 

ANC-ADK-ANC priority 

1192 

2983 

6000 

C) 

108 

324 

9.!) 

l.05S.4 

$393.00 

$393.00 

$1.50/lb 

$.75/lb 

$1.6102 

$1.6102 

$2.4345 

Revenue 

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1,496 pax $ 587,928.00 

1 A87 pax $ 5S4,391.00 

284,520 lb. $ 426.780 

174,500 lb_ $ 130,875 

138,468 lb. $ 222.961 17 

13.740 lb_ $ 22.124.15 

10,912 lb. $ 41.172.26 

(10 percent ofthc total mail estimated to be paid at mainline pri-ratc of$2.4345) 

Total Revenue $ 1,173,319 

flying Ops per hr $ 223.24 pcr/blk/hr $ 236.280.26 

Fuel & Oil per hr $ 816.00 per/blk/hr $ 863,65..J. .. HJ 

In::.urance per hr $ 40.24 periblk/hr $ 42.5~)7_53 

Maintenance per hr $ 722.49 per/blk/hr $ 764.685.34 

Aircraft per hr $ 193.04 per/blk!hr ,, ~ 204.308.84 

Flight Attendant per hr $ 52.03 pcr/blklhr $ 55.069.14 

Extra Crew Member $ 174.75 pcr/blk/hr $ 184,955.40 

Extra Mx Crew member S 39.00 per/blk/hr $ 41.277_60 

Star1 up cxpen::;e 1 $ 125,000 
... 

Total Directs s 2,517,818.51 

Departure Related (a~ $3S5.4S per Dep. $ 124JN4.0S 

Tratlic Related({~> 233.03 pcr/blk/hr $ 246,633.94 

Capacity Related (a) 313.42 periblk!hr $ 331.727.16 

Total lndirccts s 7U3,155.17 

TOTAL OPERATING EXPENSE $ 3,221,073.68 

Profit (??; 5% $ 16 L053.68 

Economic Costs $ 3,382,127.36 

Annual Subsidy ~ 2,208,808.361