BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C.
In the Matter Of Establishment of Slot Exemption Proceedings At Ronald Reagan Washington National Airport Pursuant to 49 U.S.C. S 41718 ) ) ) ) ) Docket OST-2012-0029

COMMENTS OF THE PORT OF PORTLAND IN SUPPORT OF APPLICATION OF ALASKA AIRLINES, INC. FOR EXEMPTION TO PROVIDE NONSTOP SERVICE B ETWEEN PORTLAND, OREGON AND WASHINGTON REAGAN NATIONAL AIRPORT

Communications with respect to this document should be addressed to:
Bill Wyatt, Executive Director Tom Imeson, Public Affairs Director Rick Finn, Federal Affairs Manager Port of Portland 7200 N.E. Airport Way Portland, OR 97208-3529 Rick.finn@portofportland.com

March 27, 2012

### 1 BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C. March 27, 2012
In the Matter Of Establishment of Slot Exemption Proceedings At Ronald Reagan Washington National Airport Pursuant to 49 U.S.C. S 41718 ) ) ) ) ) ) Docket OST-2012-0029

COMMENTS OF THE PORT OF PORTLAND IN SUPPORT OF APPLICATION OF ALASKA AIRLINES, INC. FOR EXEMPTION TO PROVIDE NONSTO P SERVICE BETWEEN PORTLAND, OREGON AND WASHINGTON REAGAN NATIONAL AIRPORT The Port of Portland (“Port”) is pleased to submit these comments in strong support of the Application of Alaska Airlines, Inc. (“Alaska”) to provide nonstop service between Portland International Airport (“PDX”) and Washington D. C.’s Reagan National Airport (“DCA”) with two of the eight (8) beyond-perimete r slot exemptions at issue in this docket. The PDX-DCA market is the largest O& D market without current or announced nonstop service in this case. It is also the fastest growing DC A market and it is the first choice of Alaska Airlines. Alaska proposes to provide nonstop service with a state-of-theart B737-800 aircraft, the largest aircraft proposed by the applicant carriers, and Alaska will reduce PDX-DCA average fares by 18%. 1 Grant of Alaska’s application for PDX-DC A nonstop service would be an important step toward redressing the serious and longs tanding service deficiencies between Portland

1 Exhibit AS-D-10

### 2 and Washington, D. C. PDX currently has only one daily nonstop flight to the Washington area to accommodate an O&D market of 268,122 passengers. The Department will select carriers to operate four (4) new beyond-perimeter services nonstop from a list of eight (8) cities included in the carrier applications. PDX should clearly be one of the four selected. As shown below, not only does PDX meet all of the criteria set forth in the instituting order, it ranks in the top four (or higher) when measured against the other seven (7 ) proposed cities.

I. PDX HAS A STRONG RECORD OF SERVING THE PUBLIC THAT WILL BENEFIT THE PDX-DCA MARKET The Port of Portland owns and operates Port land International Airport as well as two general aviation airports. PD X is the 26th largest passenger airport and the 26th largest cargo airport in the United States. The Port also owns four marine terminals and five industrial parks. The most recent economic im pact study shows that the Port generated 26,370 jobs, $1.7 billion in income, and more than $4 billion in business revenue. In 2011, PDX served 13.7 million passengers and has enjoyed 19 consecutive months of traffic increase. PDX connects Oregon and southwestern Washington to 58 airports around the world. The airport will have 246 scheduled passenger departures daily this summer. Twelve scheduled domestic and international passenger airlines and eight allair cargo carriers serve PDX. 2
The PDX service area extends far be yond the 2.2 million people in the Portland metropolitan area. PDX draws a large number of passengers from Vancouver and Southwest

2 Exhibit PDX - 1

### 3 Washington and serves a capture region of more than 3. 5 million people in two states. PDX is the primary Oregon airport accounting fo r 87% of all origin-d estination passengers of the State of Oregon. 3 In 2004, PDX became only the 12 th U.S. metro area to support nonstop service across both the Atlantic and the Pacific oceans. Eight years later, PDX is one of only 13 cities that will have daily nonstop se rvice across both oceans this summer. 4 Among these 13 cities, however, PDX is the only one without nonstop access to DCA. 5 PDX has better access to capitals in Europe and Asia than it does to DCA. The PDX routes to Europe and Asia were the result of long -term planning by the Port, the State and the community to secure air service vital to the growth and prosperity of the PDX region. The Port and community identifi ed the strategic air se rvice interests of the region and then committed the time and resource s with a “whatever it takes” attitude. The Port has followed this approach for th e last 10 years with great success. Following the successful efforts to attract service to Europe and Asia, DCA nonstop service became the top air servi ce priority at PDX. The Port worked closely with Alaska Airlines and with the Ore gon congressional delegation fo r years promoting expanded beyond-perimeter service between PDX and DCA. PDX has received numerous citations and awards for customer service, airport operations, and concession programs. Conde Nast Traveler magazine named PDX the best U.S. airport in four recent a nnual polls of business tr avelers. The Airlin e Pilots Association

3 Exhibit PDX - 2
4 Exhibit PDX - 3
5 Exhibit PDX - 4

### 4 (ALPA) named PDX “Airport of the Year” in 2010. Also in 2010, Zagat Survey named PDX their favorite U.S. airport based on overall quality. The award-winning PDX concessions program features the best of local, regional, and national shops and restaurants. The airport offers travelers more than 80 s hops and restaurants, which are open 365 days a year. A vibrant arts and entertainment program enriches the airport experience. 6 The PDX environmental department is a leader in wildlife hazard management, noise management, and waste reduction and recycling. Since the food waste composting program began in 2003, PDX passengers, tenants, and employees have collected more than 2,175 tons of food waste. PDX is expanding its state-of-the-art system for collecting and managing deicing runoff. Nearly 90 PDX vehicl es run on natural gas, or biodiesel B-20. The Portland service area and the State of Oregon have a d eep and extensive community of interest with Washington, D.C. Exhibit PDX - 6 lists a selection of companies and organizations that would benefit from PDX-DCA nonstop service.

II. THE DEPARTMENT SHOULD AWARD TWO EXEMPTION SLOTS TO ALASKA AIRLINES TO OPE RATE PDX-DCA NONSTOP SERVICE
The PDX-DCA market meets all the criteria set forth in the instituting order for beyond-perimeter slot exemptions. PDX has addr essed these criteria in order of proposed importance.

6 Exhibit PDX - 5

### 5 II. A. Produce public benefits, includi ng lower fares, higher capacity, and a variety of service options The clearest measure of public benefits is the number of passengers that will have nonstop service for the first time. The larger the market, the greater the potential is for public benefits. PDX-DCA is the largest O&D market among th e five proposed air ports that do not have current or announced nonstop service: Proposed Airport O&D Passengers PDX 95,797 AUS 85,383 SJU 53,982 COS 31,443 YVR * Source: Exhibit PDX - 7 PDX is almost twice the size of San Juan (SJU) and over three times the size ofColorado Springs (COS). The restricted DOT international O&D database shows that PDXDCA is many times the size of Vancouver, B. C. (YVR) and while we have no information in the record regarding foreign flag travel, the PDX-DCA O&D is certainly far larger than
YVR-DCA O&D. The remaining three proposed airports, La s Vegas (LAS), San Francisco (SFO), and San Diego (SAN) have or will have nonstop service. LAS has ha d nonstop service since 2007 and its traffic numbers include the effect of nonstop service while those of PDX do not. SFO will have nonstop service starting May 14 from United Airlines 7 and SAN will

7 Notice of Intent of United Air Lines, Inc., February 27, 2012 to institute nonstop service from San Francisco to Washington Reagan National on May 14, 2012.

### 6 have nonstop service starting June 8 from US Airways. 8 LAS, SFO, and SAN are proportionately smaller than PDX on an O&D passenger per frequency basis. 9 Alaska has quantified the public benefits of its PDX proposal to be $5.5 million annually. Applicant carriers ha ve quantified the public benef its for three other proposed airports – AUS, COS 10 , and SAN. 11 There are no quantitative estim ates of public benefits in the record for SFO, YVR, SJU, or LAS. It is instructive to note that three of the proposed airports for which quantifiable estimates have been provided were also the three largest DCA markets without nonstop service at the ti me of filing. Clearly, market size is the primary driver of public benefits and comp els the selection of PDX as one of the Department’s four selections. The latest reported O&D passenger data mo st likely understate the size of the PDX market in 2012 relative to the other proposed cities. Last year the PDX-DCA O&D market grew 16%. 12 Since 2009, DCA has been PDX’s fastest growing market with a 34% increase in O&D passengers. 13 The PDX-DCA O&D market has grown faster than any

8 Notice of US Airways, Inc. of Beyond Peri meter Service (SAN-DCA), March 21, 2012 begin nonstop service from Washington Reagan National Airport to San Diego on June 8, 2012. 9 Exhibit PDX- 8 10 While PDX takes no position on the validity of the carrier estimates, the COS estimate does not appear comparable to Alaska’s for PDX. If th e entire COS-DCA O&D base flew free, the resulting fare savings would be only 56% of the amount claimed. 11 Alaska’s estimate for SAN was submitted prio r to US Airways’announcement of SAN-DCA nonstop service. The incremental benefits of a sec ond flight will be smaller than Alaska’s original estimate. 12 Exhibit PDX - 9 13 Exhibit PDX - 10

### 7 other DCA market at issue. 14 Indeed, PDX-DCA passenger grow th has been far higher than the average growth rate for all PDX markets and all DCA markets. 15 As PDX’s growth further separates PDX from the crowd, so w ill the public benefits of PDX-DCA nonstop service further elevate the ra tionale for selecting PDX.
Lower Fares - Alaska Airlines has proposed fa res for PDX-DCA that will lower the cost of travel by an averag e of $53 per passenge r ($106 roundtrip) or 18 percent. PDX believes Alaska has demonstrated that it will do what it says. The PDX-DCA market offers more opportunity for fare savings than other proposed cities. For example, DCA is already Washington’s low-fare airport for SFO. 16 Not only is the SFO-WAS market the only WAS market in this case where the DCA average fare is lower than the BWI fare, it is 14% lower. 17

Higher Capacity -- Alaska has proposed PDX serv ice with the state-of-the-art Boeing 737-800 aircraft. It is the largest ai rcraft proposed for service in this case. Aircraft City Seats B737-800 PDX, AUS, S AN 157-175 seats A320 SJU, COS 150-168 B737-700 LAS 129 A319 SFO, YVR 119-120

14 Exhibit PDX - 11 15 Exhibit PDX - 12 16 Exhibit PDX - 13
17 Exhibit PDX - 14

### 8 E190 AUS 100 In terms of seats, the only proposed aircraft with more seats than Alaska’s B 737-800 are single-class proposals. Alaska’s proposed service will increase the seats in the PDX-WAS market by 131%. The next highest service increase at a proposed airport is only 36%. 18 Alaska’s added capacity to the PDX-WAS market will have a far greater market impact than would the capacity proposed for the other points.

II. B. Alaska’s proposal will enhance options for nonstop travel to/from PDX While any new or additional nonstop flight enhances nonstop travel options, the degree of enhancement will depend on the extent a ma rket is served prior to the new service. In this case, three proposed cities, LAS, SFO, and SAN have or will have nonstop service to DCA, so the opportunity for enhanced options is de minimis relative to PDX which has no nonstop DCA service. Similarly, Colorado Springs (COS) has access to nonstop DCA service via Denver International Airport (“DEN”) which has four (4) daily DCA roundtrip nonstop flights. Colorado Springs is virtually surrounded by th e Denver metropolitan area and is located only 90 minutes from DEN. 19 Two other airports, 20 while not having nonstop acce ss to DCA, have far more nonstop access to the Washington area airports compared to PDX which has only one flight

18 Exhibit PDX - 15 19 Exhibit PDX - 16 20 Austin and San Juan

### 9 to one Washington, D.C. airport. Both have nonstop service to bo th IAD and BWI with total roundtrips ranging from three to five per day. 21 Vancouver, B. C. is the only proposed point that does not currently have any nonstop service to the Washington D. C. area but there is a reason for this condition: YVR-IAD nonstop service failed in the marketplace. The last full 12 months of nonstop service averaged only 83 passengers per flight includ ing flow and produced an unsustainable 68% load factor. 22 Seasonal summer service was attempted in 2008, but has not been tried again. As noted above, the reported YVR-DCA O&D is quite small and there has been no other evidence of market size submitted. Finally, DCA is a more important market fo r PDX than it is for the other candidate airports. DCA is PDX’s second largest O&D destination without nonstop service 23 and as shown above, its fastest growing. Not only is DCA the largest component of the PDX-WAS market 24 , but it is the fastest growing component. 25 DCA accounts for 36% of PDX’s Washington area travel – more th an any of the other airports. 26 PDX is the only airport proposed for DCA nonstop service where the DCA O&D passengers ar e greater than the O&D passengers at either Dulles or BWI. 27

21 Exhibits PDX - 17 and 18
22 U.S. DOT T-100 for year ended September 30, 2007 23 Exhibit PDX - 19
24 Exhibit PDX - 20 25 Exhibit PDX- 21 26 Exhibit PDX - 22
27 Exhibit PDX - 23

### 10 In short, nonstop service to DCA from P DX has a significantly gr eater potential for enhancement of travel than nonstop se rvice to the other seven airports.

II. C. PDX-DCA nonstop service will in troduce nonstop competition in the PDX-WAS market PDX-DCA nonstop service would have an enormous competitive impact on the PDX-WAS market which has been starved for cap acity for years. PDX’s lone nonstop flight (at Washington Dulles) has operated with a 12- month moving average load factor that has hovered around 90% since 2006. 28 Further, over half of th e PDX-IAD capacity is being occupied by flow passengers. 29 There are over five PDX-WAS O&D passengers for every seat available to local PDX-WAS passengers. 30 Currently only 15% of the O&D passengers in the PDX-WAS (IAD, DCA, and BWI) market are able to use nonstop service while 228,000 PDX-WAS O&D passengers were forced to connect via intermediate hubs. 31 In the last year, PDX-IAD seat capacity has been reduc ed almost 10% while the latest average fare has risen over 10% (3 rd quarter 2011 over 3 rd quarter 2010). 32 The PDX-WAS market is ripe for competition and the competitive impact of Alaska’s proposed DCA nonstop will have a gr eater competitive effect than would DCA nonstop service at the other proposed airports.

28 Exhibit PDX - 24 29 Exhibit PDX - 25 30 Exhibit PDX - 26 31 Exhibit PDX - 27
32 U.S. DLT O&D Survey

### 11 II. D. Alaska’s PDX-DCA nonstop service will increase compet ition in multiple markets Alaska’s PDX-DCA will bring much needed competition to the PDX-WAS market as shown above. Alaska’s service to ten points behind PDX will increase competition for each of the points to DCA with services now provided by Delta via Salt Lake City and United via Denver or San Francisco.

II. E. Provide air transportation with domestic network benefits beyond the 1,250 mile perimeter The Alaska Airlines network at PDX is extensive and well-developed. Alaska provides service in 33 PDX markets, 10 of which are logical flow points. 33 Alaska continues to build its PDX network and in th e last 12 months has added or increased PDX service to Maui, Long Beach, Spokane, Bois e, Bozeman, Santa Barbara, Anchorage, Ontario, and Bellingham. By contrast, four of the eight proposed air ports simply do not have domestic network benefits. Any network benefit for YVR is international, not domestic. The applicant carriers for SFO and LAS have no logical flow point at either airport. The claimed network benefits for COS are illusory si nce all but one of its flow points have nonstop service to DCA, 34 and the one exception (PDX) is the la rgest DCA market without nonstop service and is a candidate to secure nonstop service in this case. The poi nts beyond COS would realize little or no benefit from a COS service.

33 Exhibits AS-D-4 and AS-D-5 34 Exhibit PDX - 28

### 12 II. F. Alaska’s PDX-DCA nonstop serv ice will not reduce travel options for small and medium communiti es within the perimeter
PDX is 1,100 miles beyond the perimeter and does not have nonstop access to any small or medium community with inside-the-perimeter service. All significant PDX-DCA passenger routings are via large hubs or intermediates outside the perimeter and all are over highly congested segments. 35 PDX-DCA nonstop service will a lleviate load factor pressure and increase travel options in the intermediate markets.

II. G. Alaska’s PDX-DCA nonstop serv ice will not result in meaningful increased travel delays Alaska’s PDX proposal will not result in meaningful increased travel delays. Alaska’s arrival and departure times at PDX ar e well-timed and are outsi de the peak airport hours. The arrival and departure ti mes at DCA are slot controlled.

************************** For the first time in eight years the Depart ment has the opportunity to open DCA, the close-in Washington D.C. airport, to new citie s located more than 1,250 miles from DCA. It is unknown when, or if, such an opportunity will occur in the future. Thus it is vitally important that the Department select the four new routes with the most public benefits. PDX should be one of the f our selected servic es. It is the s econd largest O&D market without current or announced nonstop servi ce in this case and it is the first choice of Alaska Airlines. PDX has a compelling need for more Washington service that DCA

35 Exhibit PDX - 30

### 13 service will address. PDX should have its first nonstop access to DCA before (1) other smaller markets and (2) other airports have their second, third or more access to DCA. PDX takes no position with respect to th e grant of other slot exemption requests provided Alaska’s PDX-DCA application is gr anted. Alaska and PDX have shown that PDX meets and surpasses the criteria for routes select ion set forth in the instituting order. Indeed, PDX ranks in the top four or better in all of the criteria.
Respectfully submitted,

______________________________ Bill Wyatt Executive Director

### 14 CERTIFICATE OF SERVICE
I hereby certify that one copy of the fo regoing Comments has this day been served on all parties identified on th e attached service list via e-mail unless otherwise noted. anita.mosner@hklaw.com marshall.sinick@squiresanders.com edward.sauer@squiresanders.com john.varley@virginamerica.com jegillick@zsrlaw.com jhfoglia@zsrlaw.com robert.cohn@hoganlovells.com patrick.rizza@hoganlovells.com robert.land@jetblue.com jhill@dowlohnes.com perkmann@dowlohnes.com john.fredericksen@suncountry.com bob.kneisley@wnco.com leslie.abbott@wn.com esta.rosenberg@dot.gov brian.ctr.meehan@faa.gov susan.kurland@dot.gov todd.homan@dot.gov james.dann@dot.gov john.potter@mwaa.com info@airlineinfo.com fbavent@airlineinfo.com

/s/ Rick Finn Rick Finn

### TABLE OF EXHIBITS
Exhibit Name Exhibit No.



### i PDX Serves 58 Destinations Worldwide ............................................................................... 1 PDX Accounts for 87% Of A ll Oregon O&D Traffic ........................................................... 2 PDX Is One Of Only 13 Metr o Areas With Daily Nonstop Service Across Both The Atlantic And Pacific Oceans ......................................................... 3 Portland Is The only Major City On The West Coast Without DCA Nonstop Service ............................................................................................. 4 Portland International Airport (PDX) Awards ...................................................................... 5 There Is A Strong community Of Interest Between PDX And Washington, D.C. .......................................................................................................... . 6 PDX Is The Largest DCA O&D Market In This Docket Without Current Or Announced Nonstop Service ................................................................. 7 PDX-DCA O&D Passengers Ar e First Among All Proposed Airports When Weighted For Current and Announced Service ............................................ 8 PDX-DCA Passengers Are Up 16% Year Over Year ........................................................... 9
DCA Has Been PDX’s Fastest Growing Market (Of PDX’s Top 50 O&D Markets) ......................................................................................................... 1 0 PDX Is The Fasted Growing DC A Market Among The Airports Proposed For DCA Service ................................................................................................. 11 PDX-DCA Growth Has Far Outp aces The DCA And PCS Airport Averages ...................................................................................................................... ........ 12DCA Is Already The Low-Fare Alternative For The SFOWashington, D.C. Market .................................................................................................... 13 SFO Is The Only Proposed DCA Market With DCA Fares Lower Than BWI Fares ....................................................................................................... 14 DCA Nonstop Service Will Have The Greatest Impact On PDX ....................................... 15 DEN Already Serves Much Of The Same Market As COS ................................................ 16 PDX Has The 2nd Least Nonstop Fli ghts To The Washington Area .................................. 17 PDX Has The 2nd Least Nonstop Capacity To The Washington Area ............................... 18

### TABLE OF EXHIBITS
Exhibit Name Exhibit No.



### ii DCA Is PDX’s 2 nd Largest O&D Market Without Nonstop Service ....................................................................................................................... .......... 19 DCA Is The Largest Component Of The PDX-WAS Market ............................................. 20 DCA Is The Fastest Growing Component Of The PDX-WAS Market ....................................................................................................................... .......... 21 DCA Is A More Important Co mponent Of The PDX-WAS O&D Market Than It Is Of The Other Proposed Routes ............................................................... 22 PDX Is The Proposed DCA Airport Where DCA O&D Is Greater Than IAD Or BWI ............................................................................................................... 23 PDX-IAD Load Factors Have Been At Capacity For Years ............................................... 24 Over Half Of PDX’s Limited Washington Nonstop Seats Are Occupied By Flow Passengers ............................................................................................. 25 There Are Over Five PDX-WA S O&D Passengers For Every Seat Available To Local Passengers .................................................................................... 26 Only 15% Of PDX-WAS Passengers Are Able To Use Nonstop Service27 Network Benefits For COS Are Illusory ............................................................................. 27 Over 80% Of Current PDX-DCA Passengers Are Forced Over High Load Factor Segments ................................................................................................ 28

## PDX Serves 58 Destinations Worldwide

Source: Innovata, week of June 11, 2012.

. Docket DOT-OST-2012-0029 Exhibit PDX-1 Page 1 of 1



## Key PDX Facts

● 13.7 million passengers in 2011

● 246 daily flights for summer 2012 to 58 destinations

● One of 13 U.S. airports with daily nonstop service across both Atlantic and Pacific oceans BLI BLI BLI BLI SEA SEA SEA YVR

LAS
BUR ONT ONT LGB STS OAK SFO MFR

SJC SJC SJC

SBA
SAN LAX SNA ORD

IAD JFK EW R PHL PHL PHL PHL BIL BIL BIL BIL BZN PDX RDM RDM
OTH

To KOA To KOA To NRT To NRT To NRT To AMS

To HNL To HNL To HNL

To OGG ANC

ABQ ATL ATL ATL BOI BOI BOI BOI BOS

CLT CLT CLT CLT COS DEN

DFW DFW DTW EUG

FAT FAT FAT FAT GEG GEG GEG

IAH LMT LMT LMT LMT

MCI MCI MCI MCI MDW MDW MDW MSO

MSP PDT PDT PDT PDT

PHX PSP RNO SLC

SMF SMF SMF SMF

YKM YYC

YYZ YYZ YYZ YYZPORTLAND PORTLAND PORTLAND

Klamath Falls Klamath Falls Klamath Falls Medford Medford Medford North Bend North Bend North Bend Redmond Redmond Redmond Eugene Eugene Eugene Newport Newport Newport Salem Pendleton Pendleton Pendleton Astoria Astoria Astoria



## PDX Accounts for 87% of All Oregon O&D Traffic

Source: O&D Survey, YE 2011 Q3.

. Docket DOT-OST-2012-0029 Exhibit PDX-2 Page 1 of 1



### All Other 13%

PDX 87%

## PDX is One of Only 13 Metro Areas With Daily Nonstop Service Across Both the Atlantic And Pacific Oceans

Source: Innovata, week of June 11, 2012; and American Community Survey, 2010. Docket DOT-OST-2012-0029 Exhibit PDX-3 Page 1 of 1



## 22,111,682 17,920,862

9,699,178 8,605,658 7,569,282 7,487,912 6,762,256 6,082,028 5,638,509 5,213,991 4,210,504 3,622,591 2,241,913 New York City Los Angeles Chicago Washington, D.C. Boston San Francisco Dallas/Ft. Worth Houston Atlanta Detroit Seattle Minneapolis/St. Paul Portland Metro Area Population YES YES YES YES YES May 2012 YES YES YES YES YES YES NO DCA Nonstop Service

## Portland Is The Only Major City On The West Coast Without DCA Nonstop Service

SEA

DCA PDX

LAX

SAN SFO Docket DOT-OST-2012-0029 Exhibit PDX-4 Page 1 of 1

Source: Innovata, week of June 11, 2012.

.Docket DOT-OST-2012-0029 Exhibit PDX-5 Page 1 of 1 

## Portland International Airport (PDX) Awards

2012

2012: Best Concessions Management Team ‐‐ Awarded by Airport Revenue News
2012: Best New Food Concept (Beaches Restaurant) ‐‐ Awarded by Airport Revenue News
2012 Best Retail Design (Nike) ‐‐ Awarded by Airport Revenue News
2011

2011: Safest US Airport ‐‐ Travel & Leisure magazine named PDX among the safest U.S. airports
2011: ACI ‐ NA Environmental Award
2010

2010: Best US Airport ‐‐ Zagat Survey
2010: Airport of the Year ‐‐ The Air Line Pilots Association, Int’l
2010: On ‐ Time Performance Service Award ‐‐ FlightStats Performance Service Awards program. 2010: Partnership Award ‐‐ PDX , the TSA, ACI

‐ NA and the AAAE received the Partnership Award for their work together on an airport innovative security measures initiative.
2010: ACI Environmental Achievement Award Other Awards
2010, 2008, 2007, 2006: Conde Nast Traveler magazine Best US Airport The magazine named PDX the best U.S. airport four times, a result of their survey based on a poll of business travelers.
2009: The Frequent Traveler Award for Favorite Retail Store: (Powell’s Books) Awarded by Airport Revenue News
2008: Best Customer Service Airport Airport Revenue News (ARN) noted that Portland International Airport received the Best Customer Service Award in the Medium Airports Division.
2007: Best New Food Concept: (Stanford’s Restaurant) Awarded by Airports Council International

## There Is A Strong Community Of Interest Between PDX and Washington, D.C. Docket DOT-OST-2012-0029 Exhibit PDX-6 Page 1 of 2

PDX Metro Employees Type of Business State of Oregon 18,400 State Government Intel Corp. 15,636 Technology Providence Health Systems 14,089 Health care and insurance U.S. Federal Governm ent 13,900 Federal government Oregon Health & Science Universi ty 12,000 Hospital and university Fred Meyer Stores 9,858 Retail merchandising Legacy Health Systems 9,732 Nonprofit health care Kaiser Foundation Health Plan of the NW 9,039 Health care City of Portland 8,876 City Nike, Inc. 7,000 Athlet ic footwear and apparel Portland School District 6,855 Education Evergreen School Distr ict 6,448 Education Multnomah County 5, 797 County government Wells Fargo 4,748 Financial services provider Portland Community College 4,390 Community college Beaverton School Distr ict 4,247 Education Portland State University 4,066 College U.S. Bank 3,899 Financ ial institution Southwest Washington Medical Cent er 3,345 Full-service medical center Xerox Corp. 3,300 Technology and services Vancouver School Distr ict 3,224 Education Portland General Electric 2,708 Power electric The Standard 2,500 Insurance Daimler Trucks North America 2,450 Heavy-duty/medium diesel trucks TriMet 2,431 Transit Additional Companies with business links in D.C. Thetus Corp. Software firm Harris Corp. Software firm Tripware Software firm McAfee Software firm FLIR Infared Imaging cameras Insitu Unmanned Aerial Vehicles (UAVs) TravelPortland Tourism TravelOregon Tourism Portland Business Alliance Economic Development Greater Portland Inc. Economic Development Columbia River Economic Deve lopment Economic Development City of Portland City government City of Vancouver City government

## There Is A Strong Community Of Interest Between PDX and Washington, D.C. Docket DOT-OST-2012-0029 Exhibit PDX-6 Page 2 of 2

Washington DC Associations with Links to Oregon American Physical Society Institute of Navigation American Pharmacists Association Water Environment Federation Teachers of English to Speakers of Other Languages National Congress of American Indians Ecological Society of America American Wind Energy Association American Association of Museums National Forum for Black Public Administrators American Geophysical Union Oregon Consular Corps Honorary Consul - Republic of Korea Honorary Consul - Canada Honorary Consul - Malaysia Honorary Consul - Norway Honorary Consul - Cyprus Honorary Consul - Luxembourg Honorary Consul - Belgium Honorary Consul - Austria Honorary Consul - Barbados Honorary Consul - United Kingdom Consul General of Japan Oregon Deputy Consul General of Japan Oregon Consul General of Mexico Oregon Honorary Consul - The Netherlands Honorary Consul - Thailand Honorary Consul - Liechtenstein Honorary Consul - Lithuania Honorary Consul - Repulic of the Philippines Honorary Consul - RomaniaDocket DOT-OST-2012-0029 Exhibit PDX-7 Page 1 of 1 

## PDX is the Largest DCA O&D Market In This Docket Without Current or Announced Nonstop Service


# City1 O&D Pax PDEW Portland 95,796 131 Austin 85,382 117 San Juan, Puerto Rico 53,982 74 Colorado Springs 31,443 43 Vancouver 2 2

1Excludes announced service to SFO which starts May 14, 2012. 2Note: Air Canada did not supply traffic or fare data for YVR in its application. The restricted U.S DOT data show small traffic volumes. Source: U.S. DOT, Origin-Destination Passenger Survey, year ended Q3 2011.

## PDX-DCA O&D Passengers Are First Among All Proposed Airports When Weighted For Current and Announced Service

1 2 1 2 2 1 1 1 Total

1U.S. Origin-Destination Passenger Survey, YE 2011 Q3. 2Innovata-Diio, week of June 11, 2012.



### PDX LAS AUS SFO SAN SJU COS YVR Daily Nonstops2 Annual O&D Per Daily Nonstop Docket DOT-OST-2012-0029 Exhibit PDX-8 Page 1 of 1



### 95,797 176,9913 85,383 148,775 126,122

53,982 31,443

** Current & Announced Proposed 

### 0 1 0 1 1 0 0 0 1 1 1 1 1 1 1 1 95,797 88,496 85,383 74,388 63,061 53,982 31,443

**

3 Passengers reflect impact of LAS nonstop service (stimulation).

All other airport counts are before stimulation. **Note: Air Canada did not suppl y traffic or fare data for YVR in its application. The restricted U.S DOT data show small traffic volumes. DCA O&D Passengers1

## PDX-DCA Passengers Are Up 16% Year Over Year

0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000

Q4 02 Q1 03 Q2 03 Q3 03 Q4 03 Q1 04 Q2 04 Q3 04 Q4 04 Q1 05 Q2 05 Q3 05 Q4 05 Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 12-Month Moving Total

Source: U.S. DOT, Origin-Destination Passenger Survey, YE 2011 Q3.

O&D Passengers Docket DOT-OST-2012-0029 Exhibit PDX-9 Page 1 of 1+23% +23% +26% +27% +34%

0% 5% 10% 15% 20% 25% 30% 35% 40%

DCA OGG JFK AUS KOA



## DCA Has Been PDX’s Fastest Growing Market (Of PDX’s Top 50 O&D Markets)

(PDX O&D % Change from CY 2009 to YE 2011 Q3)

Source: U.S. DOT, Origin-Destination Passenger Survey, CY 2009 to YE 2011 Q3. Docket DOT-OST-2012-0029 Exhibit PDX-10 Page 1 of 1

Rank in Growth %1 2 3 4 5-32% -6% +0.2% +6% +11% +12% +34%

-40 -35 -30 -25 -20 -15 -10

-5 0 5 10 15 20 25 30 35 40

PDX SFO AUS LAS SAN SJU COS YVR* 

## PDX Is The Fastest Growing DCA Market Among The Airports Proposed For DCA Service

(DCA O&D % Change from CY 2009 to YE 2011 Q3)

*Note: Air Canada did not supply traffic or fare data for YVR in its application. The restricted U.S DOT international data show small traffic volumes. Source: U.S. DOT, Origin-Destination Passenger Survey, CY 2009 to YE 2011 Q3. Docket DOT-OST-2012-0029 Exhibit PDX-11 Page 1 of 1

### 0% 10% 20% 30% 40%

PDX-DCA DCA - All Domestic PDX - All Domestic 

## PDX-DCA Growth Has Far Outpaced the DCA and PDX Airport Averages

Source: U.S. DOT, Origin-Destination Passenger Survey, T-100 Data, YE 2011 Q3. Docket DOT-OST-2012-0029 Exhibit PDX-12 Page 1 of 1

34%

4% 9%

### $0 $50 $100 $150 $200 $250 $300

DCA BWI IAD

## DCA Is Already The Low-Fare Alternative For The SFOWashington, D.C. Market

Source: U.S. DOT, Origin-Destination Passenger Survey, YE 2011 Q3. Docket DOT-OST-2012-0029 Exhibit PDX-13 Page 1 of 1

$197 $261 $228



### Nonstop Competition: None UA/FL UA/VX

### $0 $50 $100 $150 $200 $250 $300

SFO SJU COS/DEN LAS PDX AUS SAN YVR* Docket DOT-OST-2012-0029 Exhibit PDX-14 Page 1 of 1 

## SFO Is The Only Proposed DCA Market With DCA Fares Lower Than BWI Fares

Average Fare 

## DCA BWI

*Air Canada did not supply traffic or fare data for YVR in its application. The restricted U.S DOT international data show small traffic volumes. Source: U.S. DOT, Origin-Destination Passenger Survey, CY 2009 to YE 2011 Q3.

## DCA Nonstop Service Will Have The Greatest Impact on PDX

3,878 7,886 10,534 14,502 17,826 35,980 49,892 Total Seats 

### PDX SJU AUS SAN LAS SFO COS/DEN % Increase

Docket DOT-OST-2012-0029 Exhibit PDX-15 Page 1 of 1



### 1,680 5,786 8,084 12,304 16,020 34,300 47,540 WAS Nonstop Weekly Seats Proposed DCA Nonstop Weekly Seats 

### 2,198 2,100 2,450 2,198 1,806 1,680 2,352 131% 36% 30% 18% 11%

5% 5%

Source: Innovata, week of June 11, 2012 plus announced.

## DEN Already Serves Much of the Same Market as COS

Source: Nielsen Media Research 

# DEN

COS Denver DMA

Colorado Springs DMA Docket DOT-OST-2012-0029 Exhibit PDX-16 Page 1 of 1

## PDX Has The 2nd Least Nonstop Flights To The Washington Area

110 42 52 28 40 28

▬

▬ BWI

Source: Innovata; week of June 11, 2012 plus announced. 

### COS/DEN SFO LAS SAN AUS SJU PDX YVR Total Docket DOT-OST-2012-0029 Exhibit PDX-17 Page 1 of 1



### 56 14 14 14

▬

▬

▬

▬ DCA IAD 

### 168 190

42 42 28 14 14

▬ 334 246 108

84 68 42 14

▬ Total one ‐ way flights for week of June 11, 2012

## PDX Has The 2nd Least Nonstop Capacity To The Washington Area

14,728 2,765 8,124 3,848 5,480 3,836

▬

▬ BWI 

### COS/DEN SFO LAS SAN AUS SJU PDX YVR Total Docket DOT-OST-2012-0029 Exhibit PDX-18 Page 1 of 1



### 9,180 1,736 2,100 2,100

▬

▬

▬

▬ DCA IAD 

### 23,632 27,034

5,796 6,356 2,604 1,932 1,680

▬ 47,540 34,300 16,020 12,304

8,084 5,786 1,680

▬ Total one ‐ way seats for week of June 11, 2012

Source: Innovata; week of June 11, 2012 plus announced.Docket DOT-OST-2012-0029 Exhibit PDX-19 Page 1 of 1 

## DCA Is PDX’s 2 nd 

## Largest O&D Market Without Nonstop Service

City O&D Pax PDEW Orlando 131,364 180 Washington National 95,796 131 Austin 93,042 127 Baltimore 82,036 112 St. Louis 78,022 107

Source: U.S. DOT, Origin-Destination Passenger Survey, year ended Q3 2011.

## DCA is the Largest Component of the PDX-WAS Market

PDX-WAS O&D Passenger Shares



# DCA 36% BWI 30%

IAD 34%

Source: U.S. DOT, Origin-Destination Passenger Survey, year ended Q3 2011. Docket DOT-OST-2012-0029 Exhibit PDX-20 Page 1 of 1



# BWI 30%

IAD 34% DCA 36%

### 0 20 40 60 80 100 120 140 160 180 200

Q4 04 Q1 05 Q2 05 Q3 05 Q4 05 Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 12-Month Moving Total 

## DCA is the Fastest Growing Component of the PDX-WAS Market

BWI IAD DCA

Source: U.S. DOT, Origin-Destination Passenger Survey, YE 2011 Q3.

O&D Passenger Index (Index CY 2004 = 100) Docket DOT-OST-2012-0029 Exhibit PDX-21 Page 1 of 113% 17% 36% 34%

25% 22% 20%

0% 5% 10% 15% 20% 25% 30% 35% 40%

PDX COS AUS LAS SAN SJU SFO YVR* 

## DCA Is A More Important Component Of The PDX-WAS

O&D Market Than It Is Of The Other Proposed Routes

DCA O&D as % of WAS (DCA/IAD/BWI) O&D Docket DOT-OST-2012-0029 Exhibit PDX-22 Page 1 of 1

*Air Canada did not supply traffic or fare data for YVR in its application. The restricted U.S DOT international data show small traffic volumes. Source: U.S. DOT, Origin-Destination Passenger Survey, YE 2011 Q3.

## PDX Is The Proposed DCA Airport Where DCA O&D Is Greater Than IAD or BWI Docket DOT-OST-2012-0029 Exhibit PDX-23 Page 1 of 1



## PDX AUS COS SAN SJU SFO LAS 1 st 

## 2 nd 

## 3 rd 

## 3 rd 

## 3 rd 

## 3 rd 

## 3 rd 

## Proposed DCA Airport DCA Rank Among All WAS Airports

Source: U.S. DOT, Origin-Destination Passenger Survey, YE 2011 Q3.

### 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%2006 112007 012007 032007 052007 072007 092007 112008 012008 032008 052008 072008 092008 112009 012009 032009 052009 072009 092009 112010 012010 032010 052010 072010 092010 112011 012011 032011 052011 072011 09



## PDX – IAD Load Factors Have Been At Capacity For Years

12-Month Moving Average

Source: U.S. DOT, T-100 data, YE 2011 Q3. 

### PDX – IAD Average Load Factors
90% Docket DOT-OST-2012-0029 Exhibit PDX-24 Page 1 of 1

## Over Half of PDX’s Limited Washington Nonstop Seats Are Occupied By Flow Passengers



# DCA 36% BWI 30%

IAD 34%

Source: U.S. DOT, Origin-Destination Passenger Survey and T-100 data, year ended Q3 2011. Docket DOT-OST-2012-0029 Exhibit PDX-25 Page 1 of 1



## 54% 46%

113,964 PDX-IAD Nonstop Seats 51,898 seats available for local passengers

62,066 seats occupied by flow passengers

### 0 50,000 100,000 150,000 200,000 250,000 300,000

O&D Passengers Nonstop Seats Nonstop Seats Less Flow 

## There Are Over Five PDX-WAS O&D Passengers For Every Seat Available To Local Passengers

PDX-BWI/IAD/DCA

Source: U.S. DOT, Origin-Destination Passenger Survey, T-100 Data, YE 2011 Q3. Docket DOT-OST-2012-0029 Exhibit PDX-26 Page 1 of 1

268,122

113,964

51,898

## Only 15% of PDX-WAS O&D Passengers Are Able To Use Nonstop Service



# DCA 36% BWI 30%

IAD 34%

Source: U.S. DOT, Origin-Destination Passenger Survey, year ended Q3 2011. Docket DOT-OST-2012-0029 Exhibit PDX-27 Page 1 of 1



## 15%

85% Via Intermediate = 227,856 IAD Single Coupon = 40,266

## Network Benefits For COS Are Illusory

SEA

Source: Innovata, week of June 11, 2012

. 

## COS PDX

LAX

SAN DEN

DCA Docket DOT-OST-2012-0029 Exhibit PDX-28 Page 1 of 1



### SEA 2 PDX 1 (Largest DCA O&D without nonstop service) LAX 2 SAN 1 DEN 4 Present or Proposed Daily Roundtrip DCA Nonstops

## Over 80% of Current PDX-DCA Passengers Are Forced Over High Load Factor Segments

Source: U.S. DOT, Origin-Destination Passenger Survey, year ended Q3 2011. Docket DOT-OST-2012-0029 Exhibit PDX-29 Page 1 of 1

ORD 30%

DEN 15% DFW 5%

IAH 6%

SEA 9% MSP

7% PHX 6% Other

18%

ATL

4% ORD (UA) DEN (UA/F9) SEA (AS) MSP (DL) PHX (US) IAH (CO) DFW (AA) ATL (DL) 91% 89%

▬ 90%

▬ 91% 92% 92% ▬

▬ 93%

▬ 89%

▬

▬

▬ PDX-DCA Intermediate PDX Leg DCA Leg Blocking Segment



### PDX-DCA Routing Distribution