1. Crystal Airlines A Semester in Summary By: CJ Husselbee, Matt Burns, and Carly Mongeau WWW.CRYSTALAIRLINES.COM Crystal Airlines Takes you anywhere you need to go! Crystal Airlines

2. TABLE OF CONTENTS SI NO.TITLE OF THE SLIDESSLIDE NO 1Semester to Date3 2Individual Quarter Information6 3Ratios Compared to the Rest of the Market13 4Fleet, Routes, and Corporate Decision14 5Initial Strategy15, 23 6Fleet Decisions19 7Our Airline vs. The Market34 8Thank You!40 Crystal Airlines

3. Our Semester to Date: Quarter 7 Information Crystal Airlines

4. Our Semester to Date: Quarter 7 Information Crystal Airlines

5. Our Semester to Date: Quarter 7 Information Crystal Airlines

6. Quarter #1 and Reaction HOT OFFERS SEE THE NEW HOT OFFERS FROM “ARRIVALS” Crystal Airlines

7. Quarter #2 and Reaction HOT OFFERS SEE THE NEW HOT OFFERS FROM “ARRIVALS” Crystal Airlines

8. Quarter #3 and Reaction HOT OFFERS SEE THE NEW HOT OFFERS FROM “ARRIVALS” Crystal Airlines

9. Quarter #4 and Reaction HOT OFFERS SEE THE NEW HOT OFFERS FROM “ARRIVALS” Crystal Airlines

10. Quarter #5 and Reaction HOT OFFERS SEE THE NEW HOT OFFERS FROM “ARRIVALS” Crystal Airlines

11. Quarter #6 and Reaction HOT OFFERS SEE THE NEW HOT OFFERS FROM “ARRIVALS” Crystal Airlines

12. Quarter #7 Changes HOT OFFERS SEE THE NEW HOT OFFERS FROM “ARRIVALS” Crystal Airlines

13. Ratios Compared to the Industry LOW COST TRAVELING *TRAVEL AROUND THE WORLD FOR 50$ TO 99$ Crystal Airlines

14. Fleet, Routes, and Corporate Decision Crystal Airlines  Fleet: Maintenance level, Fuel, Aircraft  Routes  Corporate decision: Social responsibility project

15. Initial strategy Crystal Airlines  Overall: Stay a discount airline, but offer high value for the customer in reliability, cleanliness, and diversified routes, specializing in foreign and business type routes  Fleet: Keep fleet small, stick with 3 Beechcraft  Routes: Grow a little by Expanding into route F (foreign city), and more service to route D, I thought there would be growth  Corporate decision: funding for aviation mechanics program at community college

16. Fleet: Influences on decision making Crystal Airlines Fleet Depreciation :Quarter 1 Aircraft Purchase CostAccum. DepreciationBook ValueLease Cost per Qtr #1 Beechcraft 1900700,000212,250487,7500 #2 Beechcraft 1900800,000264,000536,0000 #3 Beechcraft 19001,000,000367,500632,5000 Fleet Depreciation

17. Fleet: Influences on decision making Crystal Airlines From Income Statement: Fleet expenses

18. Fleet: Influences on decision making Crystal Airlines Aircraft Scheduling

19. Fleet decisions Crystal Airlines  I kept the 3 Beechcraft 1900s until Quarter 6, my strategy was “routes first, fleet second” in other words, finding profitable routes before upgrading any aircraft  This strategy kept my operating costs low while being able to test out a lot of new routes without losing too much money  Although the lack of amenities limited number of seats I could sell for longer routes and luxury routes  Kept mileage under maximum until later in game

20. Fleet decisions Crystal Airlines  I was satisfied with the sales the airline was bringing in by Quarter 6, so I leased an Aerospatiale ATR42 ($185,000/qtr)for longer flights/luxury market  And sold 1 Beechcraft 1900 due to high depreciation  In Quarter 8 I leased a British Aero 31 ($82,000/qtr) to bring added luxury for the shorter flights with cabin class service  Went over max mileage, got fined by FAA

21. Fleet decisions Crystal Airlines Aerospatiale ATR42: leased in Q6 o Cheaper to maintain than a jet o Ideal for our resort route o Can hold 46 people, almost as many as top shelf Canadair, but at a cost of $1.4 million less, so it seemed like a good value

22. Fleet decisions Crystal Airlines British Aero 31: leased in Q7 o Similar to Beechcraft, but offers cabin class service o But no flight attendant required o More passenger comfort o Affordable, lease was only $2000 more than Beechcraft

23. Fleet, Routes, and Corporate Decision Fuel Crystal Airlines  Quarters 1-5: all fuel bought on contract  Quarter 5: Switched Fuel to ½ contract, ½ spot Quarter 8: all fuel bought on contract  Influences on decision making

24. Fleet, Routes, and Corporate Decision Crystal Airlines Maintenance  Used good maintenance to separate our discount airline from the others, keep older planes reliable  Level 2 until quarter 5  Level 3: more frequent cleaning and full preventive maintenance, Q5-Q9. Cost: $3,500 per aircraft per quarter.  After purchasing bigger plane, and entering markets where people expect luxury (resort, business travel) I kept maintanance up because customers had come to expect it

25. Fleet, Routes, and Corporate Decision Crystal Airlines Routes: Influences on decision making

26. Fleet, Routes, and Corporate Decision Crystal Airlines Routes: Influences on decision making

27. Fleet, Routes, and Corporate Decision Routes strategy changes Crystal Airlines  I was focusing on seats sold rather than # of flights at the beginning, most routes only had 1 flight to them  I kept standard markets, and added foreign city route (Quarter 1), and resort route (Quarter 5)  Kept routes under 420 miles, that is max recommended for Beechcraft

28. Fleet, Routes, and Corporate Decision Routes strategy changes Crystal Airlines Quarter 8 Sales Report  I had fare sales from Q4-Q6 for new markets, brought sales in for one quarter and ate into profits so I eliminated them  Towards the end I went to 2 flights per day to keep up with extra demand, expanded again  In Quarter 7 I added a resort route and expanded to market E (medium city, industrial park)

29. Fleet, Routes, and Corporate Decision Crystal Airlines Corporate strategy changes  Aviation mechanics program: $2500 initially to $5000 by end of game  Also donated some money to environmental causes

30. Fleet, Routes, and Corporate Decision Crystal Airlines Ending strategy  Overall: Half luxury, half discount/economy airline, focus on resort and foreign city routes, reliability, cleanliness  Fleet: 2 luxury aircraft, 2 economy aircraft, lease the luxury aircraft, fuel on contract  Routes: Keep original routes, consolidate added routes to ones with over 60% passenger load  Corporate decision: funding for aviation mechanics program at community college

31. Fleet, Routes, and Corporate Decision Crystal Airlines Operations Statistics Year-to-Date

32. Fleet, Routes, and Corporate Decision Crystal Airlines Operations Statistics Year-to-Date

33. Fleet, Routes, and Corporate Decision Crystal Airlines Operations Statistics Year-to-Date

34. Our Airline vs. The Market Crystal Airlines  Conservative  Mostly dealt with stock prices  Unrealistic

35. Our Airline vs. The Market Crystal Airlines Net Income

36. Our Airline vs. The Market Crystal Airlines Stock Price

37. Our Airline vs. The Market Crystal Airlines Quality

38. Our Airline vs. The Market Crystal Airlines Reliability

39. Our Airline vs. The Market Crystal Airlines Cumulative Net Income

40. THANK YOU Thank you for taking the time to inquire about Crystal Airlines, the airline that takes you anywhere you need to go! If you have any questions, now would be the time to ask Carly, Matt, or CJ. Thank you for the great semester, and good luck with future endeavors you may take on. Crystal Airlines Takes you anywhere you need to go!