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Federal Aviation Administration Forecast Conference March 17, 2005 PowerPoint PPT Presentation


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Federal Aviation Administration Forecast Conference March 17, 2005. Air Taxi Service. A new low cost, easy to use Private Jet Value Proposition for time sensitive travelers Very low price – never exceeding $6.00 per mile

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Federal Aviation Administration Forecast Conference March 17, 2005

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Federal aviation administration forecast conference march 17 2005 l.jpg

Federal Aviation Administration

Forecast Conference

March 17, 2005


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Air Taxi Service

A new low cost, easy to use Private Jet Value Proposition for time sensitive travelers

  • Very low price – never exceeding $6.00 per mile

  • Substantially faster than scheduled air from smaller, less crowded, hassle-free airports

  • “Car service” like accessibility

  • High quality, professionally trained personnel

  • Private jet experience

  • 225 aircraft and more than 2000 airports

  • Trips up to 500 Miles

  • Accessible and consistent

  • Easy, like calling a car service


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Pogo Leadership

  • Donald Burr - Chief Executive Officer and President

    • Chairman and Chief Executive Officer of SBS International, a leading provider of scheduling software to the airline industry (recently sold to Boeing)

    • Founder and Chief Executive Officer of People Express Airlines

    • President and Chief Operating Officer of Texas International Airlines, which acquired and became part of Continental Airlines

    • President of National Aviation, a closed-end investment company specializing in aviation investments including early-stage and reorganizations

  • Cameron Burr – Executive Vice President and Board Member

    • Partner at The Burr Group and Director of Corporate Development of SBS International

    • Hambrecht & Quist and PaineWebber where he specialized in convertible bond financings

  • David Leblanc – Chief Financial Officer and Treasurer

    • Partner at The Burr Group and Chief Operating and Chief Financial Officer of SBS International

    • Spent several years working in the airline industry with First Equity Development and Air Canada

  • Mike Bristow - Chief Operating Officer

    • Co-founder and head of operations at Vanguard Airlines, based in Kansas City, MO.

    • Captain for Continental Airlines

    • General Manager for People Express Airlines with responsibility for reservations, telecommunications, computer operations, and inventory control

    • U. S. Air Force - Deputy Director of the world’s largest repair and overhaul facility for aircraft landing gear

  • Robert Crandall – Chairman of the Board*:Former Chairman and CEO of American Airlines

  • Michael Hodge – Board Member: Managing Director Tiger Management LLC

  • David Hurley – Board Member: Vice-Chairman of Privatair


Nasa s small aircraft transportation system sats program provides the backdrop l.jpg

Relative Intercity Transit

Market Growth

SATS (Small

Aircraft

Transportation

System)

Jet Transports

Jetliners Displace Propliners

Speed

DC-3

Propliners Displace Cars

Assembly Line

Model T

Cars Displace Trains

* Graph provided by Dr. Bruce Holmes, Director of NASA’s SATS program

1900

1910

1920

1930

1940

1950

1960

1970

1980

1990

2000

2010

2020

2030

NASA’s Small Aircraft Transportation System (SATS) program provides the backdrop

Significant time savings can be realized

Transformation is occurring

Jet Air Taxi

Commercial Air Service

Prop Air Taxi

Car

Much of the required infrastructure is already in place


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Launch Market

  • Northeast region, defined as the area within 500 miles of New York City

  • There are 1.3 million high-earning, frequent flying people in this area

    • These individuals currently average 38,800,000 domestic trips/year

    • Approximately 25% of those trips are under 500 miles, resulting in 9.7 million POGO-able customer trips a year

    • POGO's total customer trip count by the end of our second year of operations will be approximately 92,000

    • POGO's 1st year revenue forecasts will be met by satisfying less than 1.0% of current demand

    • This represents less than 260 customers per day, or the equivalent of 2 B737 / A320 flights per day, or the capacity of less than 1 B737 / A320 aircraft per day


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Brand Positioning Strategy

For time-pressed, High Performance individuals, Pogo is

the revolutionary air taxi service that makes the

benefits of “on your terms” private jet travel accessible, affordable and convenient to those whose lives most demand it.

Affordable Luxury for High Performance, “Mass Affluent” and

Critical Business Tool for Small, Growing Business Entrepreneurs


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Pricing Strategy

  • Simple and consistent pricing. Customers will be charged a maximum of $6.00 per Mile per Airplane

  • Significantly and consistently cheaper than other private jet alternatives

  • Yield management practices to manage demand

    • Reduced pricing for off-peak use

    • Reduced pricing on repositioning flight


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Operating Model – Key Strategies

  • Operating System – Comprehensively Different

    • Single aircraft type: 75 Very Light Jets

      • First very light jet with very low acquisition and direct operating cost

      • One support, maintenance, and training process

    • Regional: 650 airports / 500-mile flight radius

      • Best use of aircraft operating capabilities

      • Network efficiency – reduced backhaul

    • Facilities:

      • Variable cost, no investment

  • Information Technology

    • Maximize use of real-time information in decision process

    • Optimize network efficiencies and revenue opportunities

    • Web-based flight request, confirmation and revenue capture

  • Marketing

    • Very low prices, pay at time of booking

    • Accessible – short fulfillment times with consistency and reliability

    • Personalized service – information driven and customer focused database coupled with motivated service providers

  • Operations

    • Customer support and flight dispatch

      • Operations control center with cross-functional operations teams:

        • Customer communications

        • Destination support requirements

        • Flight assignment and monitoring

    • Maintenance and Support

      • Progressive air carrier fleet management system

      • Co-locate with VLJ OEM*

      • Fixed price contract with VLJ OEM for parts and maintenance

  • People

    • Recruit customer service oriented individuals

    • Comprehensive recruiting, training, motivation, and compensation programs

    • Pursue cross-utilization approach to staffing

      * Whenever geographically appropriate


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Information Technology Strategy

  • Leading edge information technology

    • Optimization tools such as network management, tail assignment and day of operation repair

    • Customer relationship management

    • Integrated end-to-end software suite that will highly automate and optimize the use of the first very light jet innovation in an on-demand environment

  • Benefit from a “late-mover” position in the development of information technology

    • Integrated, Web-based, end-to-end software solutions that minimize cost while maximizing network revenue and customer service

  • POGO will use the latest real-time data gathering and decision support systems

    • Customer request evaluation and fulfillment

    • Flight dispatch

    • Aircraft maintenance

    • Personnel support

    • Regulatory compliance


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Pilot Strategy

  • Pilots in our model are central to safety, service delivery (revenue) and cost control (fuel) – they are double leveraged both positive and negative

    • Safety

      • 2 Pilots

      • Pilots will be trained to an air carrier standard and pilot-in-command proficiency

      • The pilot-in-command will be type rated and hold an ATP (Air Transport Pilot) certificate

      • Single aircraft type permits standardized flight training and operating procedures

    • High levels of service and productivity requires concerted, consistent leadership attention

      • A highly focused, disciplined recruiting, training and motivation program that emphasizes safety, service delivery, and efficiency

      • Rigorously design, develop and use programs that are comprehensively responsive to key pilot metrics such as, pay, schedule and respect

        • Specific programs include:

          • Comprehensive compensation plan -  salaried base pay, profit sharing, equity, and other benefits

          • Teamwork

          • "Open-book" communication

          • Cross-utilization      


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Market Opportunity

Compelling value proposition: very low priced, time saving, on demand private jet travel

Very large market potential

No one serving this market

Operating technology currently available

Highly productive operating model

Current aircraft and engine production provides lead time advantage

Available Enabling Technologies

Aircraft, engine and avionics technology

Very first, very light jet

Low acquisition price and DOC’s (Direct Operating Costs)

Lighter, simpler aircraft, avionics and engine has positive maintenance and utilization benefits

Advanced digital all-glass cockpit

Integrated information systems

Optimization of revenue and operating model

CRM technology

New support technology

FAA

NASA

Leadership Team

Experienced in identifying aviation growth opportunities and delivering value to investors

Experienced in air carrier operations

Knowledgeable in the use and deployment of leading-edge technology

Financial Returns

Powerful scalability drives rapid growth in revenue and net income

Operating cash flow positive within 12 months of start-up

Projected to have self funding operating cash flows post equity capital of $40.0M

Investment Highlights


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