Essential Air Service
Proposal
Merced, CA | DOT-OST-1998-3521
Corporate Flight Management Inc. d/b/a Contour Airlines A Tennessee Corporation
808 Blue Angel Way, Smyrna, TN 37167
ATTACHMENT 4
Dear Mr. Faulk,
Contour Airlines is pleased to submit this proposal to provide Essential Air Service to Merced, CA. As part of our proposal, we are offering the community 12-weekly flights. Contour has included options for the community that include all twelve (12) weekly flights to Los Angeles (LAX), or alternatively seven (7) weekly flights to LAX complemented with five (5) weekly flights to either Phoenix (PHX) or Las Vegas (LAS). Contour prefers a 48-month term for the award.
Contour Airlines will utilize twin-engine regional jet aircraft, comfortably configured with 30 seats.
Passengers can connect to Contour partners American, United, and Alaska Airlines. Contour anticipates significant passenger stimulation through a combination of larger equipment, lower fares, and partner airline connectivity.
We are confident that Contour’s proposed service to Merced would be beneficial for the airport, local community, and the broader region’s economic development.
Thank you for your consideration.
Ben Munson
President
2 v
Introduction to Contour Airlines
Corporate History
• Founded in 1982 in Nashville, Tennessee
• Current management assumed control in 2015 -
reset business model and launched growth strategy
Fleet of Over
35 Aircraft
Connect to
30 Cities
700+
Employees
Our Platform
• Contour Aviation includes EAS operations, private jet charters, Part 145 maintenance, and FBO services
• Airline has been optimized for EAS Markets
• Significant portion of company’s business is EAS flying, commercial and operational functions built accordingly
• Connections to multiple major airline partners
• High level of community engagement across all levels
3 4
Contour Amenities
Flight Attendant
on every flight
36” pitch
at every seat
Food & Beverage on
every flight
Free Carry-On &
Free Checked Bag
• Largest independently branded
regional airline in the USA
• Contour operates the second
largest Essential Air Service
(EAS) network in the country
• Contour has maintained its
commitment to its Essential Air
Service communities – never
terminating service during
course of contract
Our Airline Network
5 Partner Portfolio
Major Airline Connecting Partners
• Contour tickets, regardless of
connecting carrier, will distribute
across all traditional channels.
• Both Contour and connecting
flights will display on all major
OTAs and Meta-searches, as well
as our partner airline sites.
• Contour actively engages with all
carriers to provide better
connections, distribution, and
product experience for EAS
communities
• American Airlines was the first major airline
partner, launching approximately five (5) years ago
• In 2024, Alaska Airlines and United Airlines were
added to the partner profile
• By connecting to multiple partners, Contour
provides additional schedule and fare options for
passengers booking a flight connection
Distribution Strategy
6 Promoting Traffic Growth
Contour Marketing Difference
7 • Independent brand supported by professional
agencies to build awareness
• Contour marketing plan with a budget of
$25,000 per market to work collaboratively with
community to promote service
• Promotional fares with discounted price point
relative to most regional travel options
• Emphasis on traffic stimulation
Growing EAS Markets
Show Low, Arizona (SOW)
Q4 Enplanements
1,072
1,189
1,039
1,976
2021 2022 2023 2024
Contour has a long and very established history of
generating significant growth in EAS markets.
Traffic growth is a function of:
• Cabin class product configured with very comfortable
30-seat regional jet cabin
• Partnerships with multiple mainline carriers
• Pricing structure designed to stimulate traffic
• Independent brand to interact more directly with
communities
Contour recent market launch reflect this reality:
• In October 2024 Contour replaced a 9-seat operator in Show Low, AZ (SOW) to Phoenix (PHX)
• Contour traffic nearly doubled vs. prior carrier,
comparable to forecasted expectation in Merced, CA
Contour Market Stimulation
2024 vs. 2023
+90%
8 Contour Bid (Option A) Operations
Scheduled R/Ts Per Week 12
Completion Factor 97%
Annual Departures 1,211
Seats per Departure 30
Revenue
Forecast Passengers 20,822
Average Fare $75
Total Revenue $1,561,613
Expenses
Departure Costs $1,687,442
Aircraft Operating Costs $3,950,408
Overhead and Ownership $1,364,049
Marketing $25,000
Total Expenses $7,026,899
Profit Component (5%) $351,345
Proposed Subsidy Year 1 $5,816,631
Proposed Subsidy Year 2 $6,107,463
Proposed Subsidy Year 3 $6,412,836
Proposed Subsidy Year 4 $6,733,478
Bid Overview
Essential Air Service Market Merced, CA
Frequency 12 weekly Round-Trips
Hub(s) LAX (12)
Aircraft Type 30-Seat Regional Jet
Term 48 months preferred
Annual Escalation 5% Year over Year
Notes
All flights to be conducted as 14 CFR Part 380 public charters.
Accordingly, service is contingent on community waiving its rights to scheduled air transportation or submitting a proposal for Alternate Essential Air Service (AEAS).
9 Contour Bid (Option B) Operations
Scheduled R/Ts Per Week 12
Completion Factor 97%
Annual Departures 1,211
Seats per Departure 30
Revenue
Forecast Passengers 21,284
Average Fare $80
Total Revenue $1,702,736
Expenses
Departure Costs $1,708,610
Aircraft Operating Costs $4,151,185
Overhead and Ownership $1,364,049
Marketing $25,000
Total Expenses $7,248,845
Profit Component (5%) $362,442
Proposed Subsidy Year 1 $5,908,551
Proposed Subsidy Year 2 $6,203,979
Proposed Subsidy Year 3 $6,514,178
Proposed Subsidy Year 4 $6,839,886
Bid Overview
Essential Air Service Market Merced, CA
Frequency 12 weekly Round-Trips
Hub(s) LAX (7) and LAS (5)
Aircraft Type 30-Seat Regional Jet
Term 48 months preferred
Annual Escalation 5% Year over Year
Notes
All flights to be conducted as 14 CFR Part 380 public charters.
Accordingly, service is contingent on community waiving its rights to scheduled air transportation or submitting a proposal for Alternate Essential Air Service (AEAS).
10 Contour Bid (Option C) Operations
Scheduled R/Ts Per Week 12
Completion Factor 97%
Annual Departures 1,211
Seats per Departure 30
Revenue
Forecast Passengers 22,210
Average Fare $80
Total Revenue $1,776,768
Expenses
Departure Costs $1,343,899
Aircraft Operating Costs $4,653,129
Overhead and Ownership $1,364,049
Marketing $25,000
Total Expenses $7,386,077
Profit Component (5%) $369,304
Proposed Subsidy Year 1 $5,978,613
Proposed Subsidy Year 2 $6,277,544
Proposed Subsidy Year 3 $6,591,421
Proposed Subsidy Year 4 $6,920,992
Bid Overview
Essential Air Service Market Merced, CA
Frequency 12 weekly Round-Trips
Hub(s) LAX (7) and PHX (5)
Aircraft Type 30-Seat Regional Jet
Term 48 months preferred
Annual Escalation 5% Year over Year
Notes
All flights to be conducted as 14 CFR Part 380 public charters.
Accordingly, service is contingent on community waiving its rights to scheduled air transportation or submitting a proposal for Alternate Essential Air Service (AEAS).
11 www.ContourAirlines.com