Sunday, January 29, 2012

Airline may offer flight between Helena and Billings

Billings Gazette

Philip LeFevre talks about the Gulfstream’s essential Air Service routes in Montana at Billings Logan International Airport in April. Gulfstream changed its name to Silver Airways in December. The 19-seat Beechcraft 1900D plane pictured is likely the same model of plane that would be used on a possible route linking Helena and Missoula with Billings.

A Florida-based airline is close to making a decision on whether to offer a flight between Helena and Billings, directly linking the state’s Capital City with the its largest city, officials say.

The decision on the new flight could come in the next week or so, said Mickey Bowman, a vice president and spokesman for Silver Airways Corp.

“We are still sort of doing our due diligence on it,” Bowman said late last week. “We hope to have a decision by the end of the month or shortly thereafter.”

Ron Mercer, the Helena Airport director, said his staff has made a firm proposal to Silver Airways and expects the matter to be presented to the airline’s top management and board of directors soon.

“They are moving forward and we are encouraged,” Mercer said.

Talks between Helena airport officials with Gulfstream International began last fall after local leaders informally surveyed local residents about potential interest in a flight to Billings. The response to the query was strong, with many business and government officials expressing clear interest in the possibility of a one-day, round-trip service to Billings.

Last month, the air carrier has changed its name from Gulfstream International Airlines to Silver Airways. Silver is the airline that provides federally subsidized flights to a number of eastern Montana communities through the Essential Air Service program.

Based in Fort Lauderdale, Fla., the airline’s core business centers around 100 daily flights linking 29 cities in Florida, the Bahamas, Ohio, New York, Pennsylvania and West Virginia. It began flights in eastern Montana last year, taking the Essential Air Service reins from Wyoming-based Great Lake Airlines.

Bowman said the eastern Montana flights and passenger comments highlighted interest in a flight linking Billings, Silver’s Montana hub, with Helena. The flight would have no federal subsidy.

“We have to proceed carefully,” Bowman said. “This is what we term at-risk flying, since there is no subsidy involved. We have to be able to pay the bills.”

At the same time it’s been talking with Helena officials, the airline has also talking about a potential flight to Missoula and Williston, N.D., a city at the epicenter of the Bakken oil boom.

“All of those things are sort of in the pot right now,” said Mercer.

But Bowman offered few hints about whether the airline would consider adding more than one flight or pick one city over another. Mercer and Cris Jensen, the director of the Missoula airport, have been working together to some degree to win a flight that would link Missoula and Billings, with a stop in Helena.

“It’s our understanding that it would be similar to what Big Sky (Airlines) did back before they ended service in 2008,” said Jensen. “But we will be happy with whatever they give us.”

Jensen said the oil boom, while hundreds of miles away from western Montana, is at the root of the interest for a flight from Missoula to Billings. The boom is also driving interest in Billings for a Williston flight. Silver currently offers a flight to Sidney, another Bakken hotspot.

“We know there are a lot of contractors and business people from our area are driving over there now,” Jensen said. “Without the direct air service, it’s pretty time consuming and expensive to fly through Seattle or Salt Lake City.”

Bowman said his airline and has been doing market research on each of the potential destinations. In some cases, airport officials have offered incentives to land Silver. (At one point, Silver was looking at a flight from Butte to Billings, but recently failed to land the EAS money.)

Mercer said he believes the Missoula airport has offered to waive or reduce the landing fees it charges, a common approach by airports looking to woo new carriers. Mercer said Helena already has low landing fees, and he fears backlash from existing carriers if the airport lowered the fees to snag Silver.

“We said we would provide them with some marketing money,” Mercer said. “But we haven’t made any commitments. We need more information on how they would intend to operate here.”

While Silver officials have little doubt about the interest in a Helena and Missoula link, number crunching will play a key role in any decision.

“It’s absolutely imperative that we consider all the costs,” Bowman said.

Flying across Montana has been a financial challenge for others carriers. Big Sky Airlines went through at least one bankruptcy reorganization and several ownership and management shake-ups in its turbulent 20-year history.

Silver itself was formed in 2011 after investors bought some of the assets of Gulfstream, which had filed for bankruptcy in November 2010. Silver is owned by Victory Park Capital, a Chicago-based investment concern. Victory Park owns a number of companies, including an aviation-services provider. But its money- making ventures stretch to Giordano’s pizza restaurants and the Fuller Brush Co.

Mercer and Jensen agree that that flight path combining and Helena and Missoula offers the best chance to fill the 19-seat Beechcraft 1900D planes that Silver uses on its current Montana routes. Full seats are a big step towards a profitable airline operation.

“I think it would be best if they did both cities,” said Mercer.


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