Planning for Terminal Area Vertical Takeoff and Landing (VTOL) Noah Karberg, CM and Tom Rafter, AAE Nantucket Memorial Airport 2019 NEC/AAAE Airports Conference 3/29/19

2019 NEC/AAAE Airports Conference 3/29/19 Outline Introduction to VTOL & eVTOL Threat vs. Opportunity? Ground Transport or Aircraft Operator? ACK Interest Operating Concepts Conclusions 2019 NEC/AAAE Airports Conference 3/29/19

Introduction to VTOL – What? VTOL Extant: See Harrier eVTOL In development (Boeing, Bell, Embraer) Electric/hybrid 100sm/5 PAX Role of Autonomy 2019 NEC/AAAE Airports Conference 3/29/19

Introduction to VTOL – When? Deployment? Depends who you ask… AOPA: “a long time” Aviation industry: 10+ years/Maybe 2030 Uber Elevate: 2023 in Dallas & Los Angeles Transcend Air: 2024 Boston - NYC Eviation: 2022 Forbes: $2B investment in 135 aircraft Morgan Stanley: $2.9T by 2040 2019 NEC/AAAE Airports Conference 3/29/19

Introduction to VTOL – How? 2019 NEC/AAAE Airports Conference 3/29/19

Introduction to VTOL – How? Traditional Disruptive Aircraft certificate Fleet purchase Service announced Airport FAM Service start 2019 NEC/AAAE Airports Conference 3/29/19

Is VTOL a Threat or Opportunity? Threats: Technology deployed faster than FAR’s are developed Anticipated deployment tactics: See Uber Unmanned/Airspace integration Catchment Leakage 2019 NEC/AAAE Airports Conference 3/29/19

Is VTOL a Threat or Opportunity? Now is the time to identify needs: concurrent with CIP A solution to the Pilot Shortage? Answer to unoccupied vehicle parking? Catchment expansion 2019 NEC/AAAE Airports Conference 3/29/19

Is VTOL a Threat or Opportunity? Ultimately a Strategic and Practical Determination PAX Profile O&D vs. Connecting Space Constraints Ground Transport Performance Air Service Synergies 2019 NEC/AAAE Airports Conference 3/29/19

IS VTOL a Ground Transport Provider or Aircraft Operator? “Point to Point” Network Strategy Initial policy positions: Operate <500’ AGL Expansion of existing TNC model Originating vehicle fees are common at airports Airports shut out/passive so far Autonomy and AOA access vs. 1542 2019 NEC/AAAE Airports Conference 3/29/19

IS VTOL a Ground Transport Provider or Aircraft Operator? Fundamentally an aeronautical use. UAS is growing up as a child of FAR Even <500’ AGL, part of NAS Eventual pushback (noise, aesthetics, landing) need FAR coverage to avoid local regulations Grant Assurance protections Part 161/Stage 3 compliance status 2019 NEC/AAAE Airports Conference 3/29/19

IS VTOL a Ground Transport Provider or Aircraft Operator? A hybrid model remains a possibility: Concurrent Air and Landside Fence straddling operation Certification requirements (Commercial Airports vs. Heliports) Cost Centers and Rate Making 2019 NEC/AAAE Airports Conference 3/29/19

ACK Interest and Opportunity Loss of Mainland Connectivity 2019 NEC/AAAE Airports Conference 3/29/19

ACK Interest and Opportunity Loss of Mainland Connectivity 2019 NEC/AAAE Airports Conference 3/29/19

ACK Interest and Opportunity Declining revenue (Loss of 170,000 enplanements. Reduced Impact (Sponsor approval of projects) Loss of Community Benefit (1-2+ hr boat ride vs. 15 min flight) 2019 NEC/AAAE Airports Conference 3/29/19

ACK Interest and Opportunity Tourism/Historic District/Local ordinance Time is Money Too Big to Fail/Summer Finance? 2019 NEC/AAAE Airports Conference 3/29/19

Concept: Landside Operation (Concession Development) Space Plan: Close-in parking 21,780 ft2 ≈ 10 hourly ops Revenue Structure: Originating TNC fee FMV Rent w/ MAG Approach: 1x operator Master Concession 2019 NEC/AAAE Airports Conference 3/29/19

Concept: Landside Revenue TNC-type Fee: MassPort: $3.25 origination fee 33,600 arrivals, assumes: 5 seats 50% LF = $109,200/yr Rental Structure: Fair Market Value: $4.26 per ft2 for 21,780 ft2 = $92,783/yr + 10% handling fee on other operators MAG = $150,000 + $259,200: a 2.5% increase in ACK Total Revenue 2019 NEC/AAAE Airports Conference 3/29/19

Concept: Airside Operation (Aeronautical Agreement) Part 135 Commuter Terminal tenant (non-sterile) Signatory treatment Commercial Enplaned PAX PFC Entitlement Minimum Counter/office space 2019 NEC/AAAE Airports Conference 3/29/19

Concept: Airside Revenue Landing Fee: $103,824 PAX Spend: $73,920 Business Rent/Fees: $33,780 PFC: $367,920 Entitlement: $218,400 =$797,844 (+ 9% increase to ACK Total Revenue) 2019 NEC/AAAE Airports Conference 3/29/19

2019 NEC/AAAE Airports Conference 3/29/19 Concept Summary Landside: Less revenue Less impact Aeronautical: More revenue More congestion 2019 NEC/AAAE Airports Conference 3/29/19

2019 NEC/AAAE Airports Conference 3/29/19 Conclusions Many unknowns – that’s OK General synergy – vehicle parking and small community air service Early adopters stand to benefit Long Term Threat: marginalize non and small hubs, unless Regulatory Framework (perimeter rule/scope clause) Require System Funding 2019 NEC/AAAE Airports Conference 3/29/19

2019 NEC/AAAE Airports Conference 3/29/19 Conclusions 5. Conflict: Dominant mainline carriers protecting markets vs. a public getting tired of the traditional PAX experience 2019 NEC/AAAE Airports Conference 3/29/19