Skybus Airlines, LLC

Order 2006-2-22
OST-2005-20072 - Interstate Certificate of Public Convenience and Necessity - Scheduled Passenger
OST-2005-21744 - Foreign Certificate of Public Convenience and Necessity - Canada-US

Issued and Served February 28, 2006

Order to Show Cause and Proposing Issuance of Certificate Authority - Bookmarked

If granted the certificates it seeks, Skybus intends to provide scheduled passenger, low-fare, all-coach air service from Port Columbus International Airport. Columbus, Ohio, to various cities in the United States and Canada. To begin operations, the applicant plans to lease two new aircraft configured between 130 and 160 passenger seats, and to add one additional aircraft every two months until it has a total of 8 aircraft by the end of its first year of operations, with the eighth aircraft designated as a spare. The applicant expects to operate these aircraft an average of 15 block hours per day.

The applicant furnished data on its proposed flight operations, including forecast monthly block hour usage and rates, revenue, and operating costs, and a schedule of projected pre-operating expenses. We have examined Skybus' projected expenses and find them to be reasonable. Specifically, the applicant expects to incur approximately $40.0 million in pre-operating expenses, of which $4.5 million has already been paid, and approximately $80.3 million in first-year expenses. Based on these forecasts, we estimate that Skybus will need about $55.6 million to meet the Department's financial fitness criteria.

By: Michael Reynolds