Air transport study to explore improving local service
A Washington D.C. based company has been awarded a more than half a million dollar contract to carry out an air transport marketing study to assess the needs and market for expanded air cargo and passenger transportation services in and out of the Pago Pago International Airport.
The Request for Proposals (RFP) issued in May this year states that this study is funded with a $600,000 grant from the U.S. Department of Interior.
In a letter yesterday, chief procurement officer Ivy Taufa’asau informed UBM Aviation - ASM that the company has been selected to provide the “Air Transport Marketing Study” for the amount of $599,999.
“This decision has been guided by the findings of the Source Evaluation Board who had recommended that the proposal submitted by your firm is responsive and advantageous to the American Samoa Government,” said Taufa’asau in the letter to company’s vice president of consulting services Mark Raggio.
ASG “anticipates good service and the timely completion of this project” from UBM - ASM, she said, adding that all contracting activity for this project is coordinated with the Procurement Office’s contracts division and the local Dept. of Commerce (DOC).
Samoa News understands that the Procurement Office in response to the RFP received about 10 proposals. DOC will oversee the project.
According to the RFP, ASG prefers to consider five possible approaches to increasing air passenger and cargo service to and from American Samoa. However, the five options for consideration all hang on getting U.S. Department of Transportation (USDOT) approval.
The U.S. Department of Transportation (USDOT) may grant stopover rights at U.S. domestic airports to foreign carriers. For example, on a route between Auckland and Los Angeles, a foreign carrier can carry foreign and U.S. passengers with a Pago Pago stopover. In either direction, the passengers — both foreign and U.S. — will be able to stop in Pago Pago for a temporary stay.
ASG says USDOT in past orders has granted Alaska, Hawai’i, Guam and the Commonwealth of the Northern Mariana Islands, “expanded stopover, transfer and co-terminalization authority for foreign carriers serving their airports.”
“American Samoa’s air transport service to and from the US is severely restricted by US cabotage laws that prohibit foreign carriers from transporting passengers between American Samoa and other parts of the US,” according to the draft of American Samoa’s Comprehensive Economic Development Strategy 2012 released last month for public comments.
The draft also states that the scope of work for the air transport survey clearly lays out the challenges affecting air transport in American Samoa and the changes American Samoa hopes to make and see made.
FOREIGN CARGO TRANSFER RIGHTS
ASG says passenger stopover rights might be combined with foreign cargo transfer rights to “enhance the economic benefits for foreign carriers to stopover in Pago Pago.” For example, a foreign carrier might carry cargo from Auckland to Pago Pago for further transport by regional carriers to other islands outside of American Samoa.
However, if a foreign carrier were to carry U.S. cargo from Los Angeles to Pago Pago for similar foreign destinations, the foreign distribution must be with that airline’s aircraft and crew, unless another authorization applies to supplement the permissible service — something which has been done in the past.
ASG discussed at length the code-sharing scheme, which is a commercial agreement where two or more airlines agree to share, for marketing purposes, the same code used to identify carriers in the airline computer reservation systems.
Such an agreement, in effect, allows two carriers to offer a new service route, to benefit from each other’s marketing network and to develop more traffic together, all with less financial risk than each if each were to act alone, said ASG.
For example, under code sharing, a foreign carrier together with a U.S. carrier could jointly market air service between Pago Pago and Los Angeles. By instituting their service to and connecting with their respective service at Pago Pago under a code share, the foreign and U.S. carriers can develop the desired market with considerable cost savings to each other.
ASG points out that this type of agreement can also include air cargo services. It also outlines the benefits for this type of agreement.
ALASKA STATUTORY PROVISION
According to ASG, foreign carriers arriving in Alaska can now apply for the USDOT’s discretionary authorization to transport foreign cargo to Alaska and transfer that cargo to another foreigner carrier — or to a U.S. carrier — for transport to a foreign destination.
Under code sharing a second foreign carrier could even combine the foreign cargo with U.S. cargo — from a U.S. carrier — in Alaska for transport to foreign destination, said ASG, adding that the special Alaska statutory provision is set by federal law and a similar one for American Samoa would require congressional legislation.
AIR SERVICE & ACCESS FOR SMALL AND RURAL COMMUNITIES
Among the top policy goals for the USDOT Office of Aviation and International Affairs is the improvement of air service and access for small and rural communities in the context of opening markets and providing community benefits, said ASG.
And the three primary goals of this are: liberalizing international air services by seeking market liberalization; ensuring the benefits of a deregulated, competitive domestic airline industry; and developing policies to improve air services and/or access to the commercial small and rural communities.
“In pursuit of these goals, USDOT has expanded foreign air service for other communities throughout the U.S,” said ASG.