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Home My WebLink AboutRes.3417.06-07-2021 BILL NO. 21-85 RESOLUTION NO. L344/ 1 A RESOLUTION AUTHORIZING THE CITY MANAGER TO MAKE RECOMMENDATIONS TO THE UNITED STATES DEPARTMENT OF TRANSPORTATION FOR SKYWEST AIRLINES TO PROVIDE AIR CARRIER SERVICE UNDER THE ESSENTIAL AIR SERVICE PROGRAM, AT THE CAPE GIRARDEAU REGIONAL AIRPORT WHEREAS, on April 15, 2021, the United States Department of Transportation (US DOT) requested proposals from air carriers interested in providing Essential Air Service to multiple communities, including Cape Girardeau, for a two to four year contract; and WHEREAS, in selecting a carrier to provide subsidized essential air service, the U . S . DOT considers the following factors : 1) service reliability; 2) contractual and marketing arrangements the applicant has made with a larger carrier to ensure service beyond the hub airport; 3) interline arrangements with a larger carrier at the hub; 4) costs to provide the service; and 5) community views; and WHEREAS, the U. S . DOT received two proposals for the above- mentioned service from: Air Choice One Airlines, and SkyWest Airlines; and WHEREAS, after considering each of the airline proposals, the final recommendations of the Airport Advisory Board are: 1) to recommend to the United States Department of Transportation to award the Essential Air Service three-year contract to SkyWest Airlines, to provide scheduled air service between Cape Girardeau and Chicago O' Hare International Airport, and 2) to recommend to the United States Department of Transportation to award such contract to SkyWest Airlines, utilizing the two daily, or twelve weekly, roundtrip schedules to Chicago O' Hare International Airport as contained in the proposal submitted by SkyWest Airlines . NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF CAPE GIRARDEAU, MISSOURI, AS FOLLOWS : ARTICLE 1 . The City Council hereby accepts the final recommendations of the Airport Advisory Board pertaining to carrier selection for Essential Air Service at the Cape 1 Girardeau Regional Airport, and directs the City Manager 1) to recommend to the United States Department of Transportation to award the Essential Air Service three-year contract to SkyWest Airlines, to provide scheduled air service between Cape Girardeau and Chicago O' Hare International Airport, and 2) to recommend to the United States Department of Transportation to award such contract to SkyWest Airlines, utilizing the two daily, or twelve weekly, roundtrip schedules to Chicago O' Hare Airport as contained in the proposal submitted by SkyWest Airlines . PASSED AND ADOPTED THIS 7th DAY OF June , 2021 . Bob Fox, Mayor ATTEST: „ --••• •,N;;;"-----_,N d , *41 Gayle .eyConerexadzeCit y Clerk .; ''.„tri• 4'l // 1 c$4.- ' („,.%%%%.............. 2 ww esa S4! I R L I N E Sm May 19, 2021 Michael Martin United States Department of Transportation Office of Aviation Analysis 1200 New Jersey Ave SE Washington, DC 20590 SkyWest Airlines' Essential Air Service Proposal for Cape Girardeau, Missouri Dear Mr. Martin: Attached is SkyWest Airlines' proposal to provide air service from Cape Girardeau, MO, to Chicago O'Hare (ORD). SkyWest welcomes the opportunity to continue to provide air service to the Cape Girardeau community. Our combination of safe and reliable aircraft, well-timed schedules, and access to one of the world's largest airline networks will provide passengers with quality air service and stimulate economic growth in the region. As directed by the RFP, we will offer 12 round-trip flights per week for a three-year term to ORD. All flights will depart and arrive to facilitate seamless connections to United's large and diverse flight schedule in ORD, which will make the service convenient for both business and leisure travelers. With hundreds of United or United Express departures per day at Chicago O'Hare International Airport to over 100 unique destinations, our proposal makes it easy to get to destinations across the country and around the world. All flights are subject to gate availability and up -line scheduling restrictions. SkyWest believes this proposal provides the best overall option for air service in Cape Girardeau, with excellent connectivity to the national transportation system. Thank you for your consideration Greg Atkin Managing Director— Market Development SkyWest Airlines 444 S. River Road I St. George Utah 84790 1435.634.3000 1 skywest.com About SkyWest Airlines With over 13,000 aviation professionals operating nearly 2,400 daily flights, SkyWest Airlines connects millions of passengers each month to 258 destinations across North America. SkyWest operates in partnership with Alaska Airlines, American Airlines, Delta Air Lines, and United Airlines and has a fleet of 484 aircraft. SkyWest has been connecting small communities to the national transportation system for its entire nearly 50 year history. Headquartered in St. George, Utah, SkyWest's industry- leading workforce and excellent leadership team have consistently generated top tier operational reliability, setting the standard for excellence in the regional airline industry. ■ Fortune World's Most Admired Companies 2019 ■ ATW Regional Airline of the Year three times ■ Bombardier's top reliability award for the CRJ200 six times ■ The FAA's AMT Employer Gold Award for Excellence multiple times skywest.com S/ryilVest A I R U N E S® Critical Attributes of SkyWest's Proposal 50 Seat Twinjet Service The CRJ-200 is a quiet and modern twinjet that is both safe and fast. All SkyWest CRJ200 aircraft are serviced by a highly -trained flight attendant and each plane features a restroom, further adding to the comfort and convenience of each passenger's flying experience. SkyWest operates 150 CRJ-200 aircraft and plans to keep this aircraft in its fleet for many years to come. Superior Traffic Generation SkyWest 50 seat jets provide the best opportunity for passenger growth. SkyWest service provides significantly higher seat capacity than other regional operators and delivers industry leading reliability. Passengers also benefit greatly from seamless connectivity to one the largest global airlines in the world. E - # Critical Attributes of SkyWest's Proposal Route a�ygGi Ph°n /.. San Diego - /" va3las- Tu— - Map e n C sto Isla South America Asia Beijing va °u~ Delhi Hong Kang sets Seoul (Incheon) Shanghai(Pudong) P-1—d(OP) Taipei Eugarmm Tnlrvn 44—,N) Superior Network and Connectivity This service will be marketed as United Express and will feature seamless bookings, connections, and baggage transfers that will access United Airlines' vast global network. This includes over 5,100 daily flights to more than 330 airports. United is also the largest member of the Star Alliance network, which allows travelers to connect to more than 22,000 daily flights to nearly all parts of the globe. This full codeshare and connectivity makes it simple for passengers to plan their travel and to effortlessly fly to their destination. Superior Airports and Terminals Chicago is among the largest cities in the country. In addition, it is also the chief hub for United Airlines. Flights will arrive and depart from United's main terminal. This means passengers will not have to re -clear security or hop on a bus to make a connection. Missau.a Boise J'Wkson Hole �� in�Lon Bany°Y Harr -a: P°r[IaM (Io1E) Eurooe Amsterdam Brussels Budapest Copenhagen Dublin Edinburgh Frankfurt 1 sta nbul Krakow Lisbon London (Heathrow) Munich Paris (Charles de Gaul le) Rome (Fiumicino) Stockholm Vienna Warsaw Zurich A I R L I N E Sa a�ygGi Ph°n /.. San Diego - /" va3las- Tu— - air Jar °n e n C sto Isla South America - SAo Paulo (Guarulhos) Lti a ust IAH Hew Cki:eans - vii rl Africa �,n Sara dale Addis Ababa san J°se del cam Nesea. weer Oceania carr Auckland Meir° city c, -and ayman Mmtega Hay t i Amsterdam Brussels Budapest Copenhagen Dublin Edinburgh Frankfurt 1 sta nbul Krakow Lisbon London (Heathrow) Munich Paris (Charles de Gaul le) Rome (Fiumicino) Stockholm Vienna Warsaw Zurich A I R L I N E Sa Critical Attributes of SkyWest's Proposal A Superior Reliability r SkyWest has been named the most reliable CRJ-200 operator in North America five times since 2007. We have also been named the #1 On Time carrier for contiguous 48 states several times. Subsidy Cap Compliant All applicable SkyWest EAS communities are comfortably compliant with the DOT's passenger subsidy cap. SkyWest's proposal in Cape Girardeau is also well within compliance of the subsidy cap. The SkyWest proposal will provide measurable assurance in complying with DOT regulations, ensuring that Cape Girardeau is well positioned for future air service. EAS Bid SkyWest Airlines Essential Air Service Bid 05/19/2021 CGI ORD Number of Round Trips Per Week 12 Aircraft Type CRJ Passenger Revenue Passengers 29,000 Average Fare $ 92.00 Revenue $ 2,668,000 Block Time $ Trip Block Time (minutes) 87 Total Scheduled Block Time 1,810 Total Completed Block Time 1,699 RPMS Passengers 29,000 Stage Length 340 Total RPMs 9,860,000 ASMs Scheduled Departures 1,248 Competed Departures 1,200 Stage Length 340 Available Seats 50 Total ASMs 20,407,670 Expenses Marketing Costs Direct Operating Expenses RPM Related Departure Related ASM Related $ $ $ $ $ 20,000 4,347,369 118,879 1,164,708 190,199 Total Expenses $ 5,841,155 Operating Income (loss) $ (3,173,155) 5% Profit Margin $ 292,058 Annual Subsidy Requirement $ 3,465,213 Effective Subsidy Rate Per Unit Subsidy Per Trip $ 2,887 Subsidy Per Passenger $ 119 Load Factor 48% AIR CHOICE ONE F L- IlFkro-RDEM rwlissou 11. e _ a g�:�®� - �� I'a o � � "',�a�^� JI R i j� a ^e - a e• e IL PROPOSAL TO PROVID,§ENTIAL AIR SERVICE ilft DOT-OST-1996-1SS9 1 May 19, 2 1 ,, II Contents 01 About Us 02 What We Do 03 Flights & Destinations 04 Proposed Plane OS Proposed Route & Growth Strategy 06 2020 Performance Review 07 Marketing 08 Fares & Baggage 09 Methods of Purchase St. Louis, MO Air Choice One is a community -minded and globally focused airline. As industry leaders, we practice integrity, innovation, and professionalism through our provisions and the communities we serve. We will continue to uphold these values and strive to amplify our culture while expanding our market. ,NNW u a', We -have over 6 ars e 6 ars r 0. c latio v otcombined aviati e x enence! 2 l."ka 4422wi-- % PN WNT N Air Choice One has vision. In 1979, Multi -Aero, Inc. d/b/a Air Choice One was established in St. Louis, Missouri, as a scheduled commuter airline. Our vision is to break from the classic commuter stereotype and offer a comfortable, relaxing, and affordable air travel option right from your hometown. We deliver This Is this vision through our reliability, community -specific flight scheduling, and value -focused marketing. what we do. WA Executive Summary Founded in 1979 FAA Part 135 certificate with DOT Commuter Authority. Safety Rating We pride ourselves on safety. Air Choice One received the industry accredited Argus Gold Safety Rating. Fleet Summary Beechcraft 1900C Cessna Caravan 208B We operate a fully functional fleet in both scheduled and nonscheduled air transportation operations, headquartered in St. Louis, Missouri. Our operations can provide communities the convenience to connect to the national transportation system via international airport hubs such as St. Louis Lambert, Chicago O'Hare, and Hartsfield - Jackson Atlanta. Using advancements in technology, we are committed to giving our passengers an enjoyable travel experience from their initial booking to completing their flight. We have innovative methods to achieve passenger growth in every city we serve. By selling tickets on the Global Distribution System (GDS) we can sell available inventory on 3rd party travel agency sites like Expedia, Travelocity, Orbitz, and Kayak. Additionally, Air Choice One utilizes digital marketing methods such as Email Campaigning, Google Ads, and Social Media Advertising to increase ticket sales. Rigorous surveying and research have informed these methods and their application. COVID-19 Safety & Awareness Air Choice One considers the safety of its passengers and employees a top priority. We are taking active measures against COVID-19, like providing company -wide face masks, and conducting extra sanitation in our planes/airport common areas. Air Choice One will continue to closely monitor the situation, making adjustments to our operations as required. We require all passengers and employees to follow CDC and FAA guidelines for everyone's safety and health. Find out more about Air Choice One's COVID-19 response at https://www.airchoiceone. com/customer-service/ updates. Flights & Destinations Air Choice One's Route System. Destinations for Air Choice One include: Burlington, Iowa (BRL) I Jackson, Tennessee (MKL) Jonesboro, Arkansas (JBR) Air Choice One currently services the following Hub Airports: Atlanta, Georgia (ATL) I Chicago, Illinois (ORD) I St. Louis, Missouri (STL) Proposed Plane Beechcraft 1900C Technical Specif ications The Beechcraft1900C is a 19 passenger -capable, pressurized twin -engine turboprop fixed -wing aircraft manufactured bythe Beechcraft Division of Textron Aviation. Efficiency At Its Finest The most efficient solution for short -haul flights, the Beechcraft 1900C is Air Choice One's choice for a pressurized aircraft with all forward -facing seats. P_ a Specifications & Amenities Seats up to 19 passengers, Passengers can have up to 150lbs of luggage, Comfortable leather seating. The performance of the Beechcraft 1900C allows for year-round operations out of all airports in this bid with maximum passenger loads and luggage. Proposed Route & Growth Strategy Choice One (2) Year or (4) Year Term Beechcraft 1900C (24) Total Round trips Per Week (12) Round trips from Cape Girardeau Regional Airport (CGI) to St. Louis Lambert International Airport (STL) & (12) Round trips to Nashville International Airport (BNA) Proposed Route & Growth Strategy Destinations matter most to passengers. CHOICE ONE Choice One is 24 weekly round trips. 12 round trips from Cape Girardeau Regional Airport (CGI) to Nashville International Airport (BNA) & 12 round trips to St. Louis Lambert International Airport (STL) utilizing the Beechcraft 1900C for a two or four year term. Proposed Financial Details for Choice One Operational Revenues Revenues $1,139,600 Other Revenues 11,396 $1,150,996 Direct Operating Expenses Flying Operations $503,360 Fuel and Oil 868,682 Maintenance 733,547 Aircraft Leases 500,000 Total Direct $2,605,589 Marketing 50,000 Total Subsidy Indirect 1,331,208 Year 1 Total Operating Expenses $3,986,797 Year 2 Operating Loss $2,835,801 Year 3 Profit Element (5% total operating expenses) 199,340 Year 4 Compensation Required $3,035,141 Compensation per PAX $19700 Compensation per Departure $1,23700 Number of Passengers 14,000 Average Fare STL $59.00 Average Fare BNA $89.00 Departures 2,454 Block Hours 1,630 Revenue Passenger Miles 2,240,700 Available Seat Miles 3,203,142 OUR GROWTH STRATEGY Air Choice One's Beechcraft 1900C will accommodate nine passengers per flight. Based on 24 round trips a week for 52 weeks, the total available seats under EAS will be 22,464 seats. $3,723,000 (Per departure$1,011) $3,834,690 (Per departure $1,042) $3,949,731 (Per departure$1,073) $4,068,223 (Per departure $1,105) Performance Review Air Choice One prides itself on its reliability and performance Passengers Carried The amount of passengers carried is reflective of the last two years (Does not reflect usual performance due to the COVID-19 pandemic) Beechcraft 7900C R -ompletion rate On Time Performance According to consistently updated tracking data, on-time performance averages 86% for the company as a whole. OVERVIEW Marketing How we execute our marketing plan for your city. Air Choice One has professional full-time marketing personnel dedicated to the success of its routes. We implement several different marketing strategies to extend our sales reach; however, we invest more widely in digital efforts as we see a better ROI. DIGITAL MARKETING Air Choice One's website will include a landing page for each added route. These landing pages will highlight things to do and places to go in the respective communities. Our website is newly designed and customer optimized. We have executed search engine optimization methods to increase traffic to the site. Annually, Air Choice One receives over 500K visitors. Currently, you can find us via our website or through Google Maps & Google Flights. For example, you could google Burlington, IA to Chicago, IL, and Air Choice One will come up as a flight option. Our digital marketing strategy will execute targeted digital ad campaigns and promotions through Facebook, Instagram, Twitter, Pinterest, and Linkedln. Additionally, we will run SEM campaigns through Google Ads to increase ticket purchasing. Our digital efforts allocate most of your marketing funds based on research that most consumers find their travel deals through online search and social media. Currently, Air Choice One has a large social following that has expanded exponentially in the last few years and continues to grow. We promote Cape Girardeau across our social channels to attract visitors to your city, as well as to the provided destinations. PUBLIC RELATIONS Our public relations strategy relies heavily on cause marketing. We accomplish cause marketing through digital exposure partnerships and in-person participation of local charities and donations for the causes they support. Air Choice One will serve as a staunch advocate for travel to and from Cape Girardeau. TRADITIONAL MARKETING As part of our traditional marketing methods, we will have radio sponsorships in target cities to reach those who are more enticed by radio than online advertising. We will invest in billboards and signage to advertise the Cape Girardeau Regional Airport and the air service. Additionally, we will invest in print advertisements in local newspapers, magazines, visitor's guides, and newsletters. OUR PROGRAMS AND OFFERINGS As previously mentioned, Air Choice One has a newly designed and optimized website that is attracting tens of thousands of visitors a month. You can complete your flight booking and even book a connection on another airline with our partner Choice Travel Agency from our dynamic home page. Currently, we offer flights to St. Louis, MO (STL), Jackson, TN (MKL), Jonesboro, AR QBR), Atlanta, GA (ATL), Chicago, IL (ORD), and Burlington, IA (BRL). REWARDS In 2019, Air Choice One launched our branded customer flight rewards program, Choice Plus. You can find our Choice Plus information right on our website's home page under the "Rewards" menu option. Choice Plus was designed with the customer in mind. We want to reward every one of our loyal passengers, and we couldn't think of a better way. Once signed up for Choice Plus, Air Choice One will email you a loyalty number that you can utilize in your flight reservation every time you fly to rack up the rewards. Rewards members will earn points every time they fly with us. You will receive a percentage of the routes total points depending on the ticket tier you chose; Go Your Way fares receive 20% of the points for that route, Everyday fares receive 60% of the points for that route, and Business fares receive 100% of the points for that route. Every dollar spent is worth 1 point, and each point is worth 10 cents upon redemption. Points expire two years from the date earned. For more information about Choice Plus, please visit the rewards link on our website. EXAMPLES OF PAST PROMOTIONS In the past six months, Air Choice One has run several promotions, both online, on the radio, and in print, in order to increase ticket sales. We do this annually, and for every city we service. Occasionally we will provide promotions specific to your city. Some of Air Choice One's successful promotions include utilizing promotional codes through social media ads and Google ads. For example, in February 2020, we ran a promotional code LUVACO for 75% off our Everyday fares. To receive the 75% off, customers booked their desired flight on a Tuesday or Thursday during February, between 1 PM and 4 PM. The promotion required the future passenger to fly by the end of March 2020. We spent $450.00 on the ad and saw 4,000 page views and 257 purchases, which averaged to $1.50 spent per purchase of a ticket. In January 2021, Air Choice One ran a promotional fare sale of our Everyday fares. If customers booked with promotional code NY21, they could save 15% off our average pricing on Everyday fares. We spent $300.00 on the digital ad distribution. We received 6,552 page views and 130 ticket purchases, which averaged $2.14 spent per purchase of a ticket. Fares and Baggage We provide travelers the most baggage at the best afford -ability. Our prices are low, and our value is high! We provide travelers the best ticket afford- ability mixed with the most generous amount of baggage on pristine and comfortable planes. Air Choice One structures our fares and baggage into three tiers; Business Fare, Everyday Fare, and Go Your Way Fare. Business Fare is our top -tier fare which allows for the most baggage. The Business Fare allows, at no extra cost, one personal item that is up to 20lbs and measures 18" by 18" by 18". Additionally, one carry- on up to 30lbs and measuring 22" by 9" by 14" is included. Plus, you can have up to two checked bags up to 50lbs each and measuring 38" by 27" by 14". Total Business Fare baggage allowance is 150lbs. Our Everyday Fare is our second tier fare which allows for the second most baggage and is our most FREE FREE,j popular flight option. The Everyday Fare allows, at no extra cost, one personal item that is up to 20lbs and measures 18" by 18" by 18". Additionally, one carry -on up to 30lbs and measures 22" by 9" by 14" is included. Plus, you can have one checked bag up to 50lbs and measuring 38" by 27" by 14". Total Everyday Fare baggage allowance is 100lbs. Our Go Your Way Fare is a promotional fare online - only and changes based on sales and promotions run. Go Your Way allows only for one personal item that is up to 20lbs and measures 18" by 18" by 18". This fare is utilized by quick -trip and weekend travelers most frequently. It is also our most affordable priced fare. You can purchase additional baggage for an extra fee on any tier mentioned. IJ Methods of Purchase We have multiple avenues for purchasing and checking -in. Methods of Purchase The Air Choice One customer has many avenues to purchase a ticket. The multiple avenues of purchasing methods allow Air Choice One to maximize its customer base and ticket sales. See all the avenues of purchasing a ticket on Air Choice One below. Methods of purchasing for a customer are vast. A customer can book directly on AirChoiceOne.com through a desktop or a mobile device. A customer can call in to our customer service line, 1-866-435-9847, and speak to one of our representatives who would be happy to book them on an Air Choice One flight. Air Choice One is on several Global Distribution Systems (GDS), displaying our fares on Online Travel Agency websites like Expedia, Kayak, Hotwire, and Chipmunk. Air Choice One is on GDS systems, including Travelport, Sabre, Hahn Air, and Worldspan. Methods of Check -In Once you have a ticket and are ready to check-in for your Air Choice One flight, there are a couple of options available to you. One, you can check-in in person at the airport ticket counter. Two, you can check-in before your flight on our website by utilizing the Check -In feature on the homepage. Three, you can check-in through your mobile device. Developments In 2021, Air Choice One has acquired TSA PreCheck capabilities for our passengers' convenience. This development will allow passengers to move through security much quicker and have a more pleasant boarding experience. Old]:��L6l!■[t 61IRIESIG1901116 Direct Inquiries Regarding this Proposal to: Shane Storz President Air Choice One Airlines 12300 Old Tesson Road, Phone: (314-843-8501) ext: 1008 Suite 200 F, E-mail: shane@airchoiceone.com Saint Louis, MO 63128