Viewing page 74 of 82

This transcription has been completed. Contact us with corrections.

- 62 -

expense of the station is about equally related to the two services performed.

4. Promotional expense.
Both carriers have limited market identification within the area. Allegheny accounts for only about 4% of the total fixed-wing passengers at Washington (AL-T-1, p. 6), and Piedmont even less. 110/ While their identity in other markets in the eastern area would be helpful, this advantage would be diluted by the reluctance of other fixed-wing carriers to promote the service of a competitor. NYA as a neutral carrier would suffer no such disadvantage.

C. Selection of a Local Service Carrier Would Deprive the Area of the Independent Concentration On the Development of Helicopter Operations Essential for Its Full Success.

In the Los Angeles Helicopter Case 8 CAB 92 (1947), the Board denied the application of Southwest Airways (now Pacific Air Lines) stating:

"...To award both a feeder and a helicopter operation to Southwest would be to place upon this company responsibility for conducting two experiments having unusual national significance. With so many different problems involved it is questionable whether either enterprise would develop its maximum potential if undertaken concurrently by one managerial group. At the time of the hearing Southwest had not inaugurated service over route No. 76 and we believe that Southwest should at this time concentrate on the development of its feeder system to establish the feasibility of that service." (p. 97)

The record here demonstrates that helicopter service will still not develop its potential "if undertaken concurrently" by a local service carrier.

Selection of a local service carrier would dilute managerial concentration on the complex and unique problems of helicopter operations. Mr. Davis testified that no one in Piedmont's headquarters would have primary responsibility for helicopter operations (Tr. 2373-4), that additional time required by management would be "fairly minimal." (Tr. 2375) Piedmont's highest ranking helicopter employee would be the station manager and a chief helicopter pilot. (Tr. 2387) The sales would be handled in the Washington area by the existing sales staff. (Tr. 2376)

[---]
110/ For the year ended June 30, 1961, Piedmont's passenger enplanements were only 69.4% of Allegheny's.