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Order 2016-6-5 UNITED STATES of AMERICA DEPARTMENT of TRANSPORTATION OFFICE of the SECRETARY WASHINGTON, D.C

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Order 2016-6-5 UNITED STATES of AMERICA DEPARTMENT of TRANSPORTATION OFFICE of the SECRETARY WASHINGTON, D.C Order 2016-6-5 UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C. Issued by the Department of Transportation on the 10th day of June, 2016 Served: June 10, 2016 2016 U.S.-CUBA FREQUENCY ALLOCATION PROCEEDING DOCKET DOT -OST-2016 -0021 ORDER Summary By this order the Department approves the requests of six U.S. carriers seeking authority to provide scheduled passenger services between the United States and points in Cuba, other than Havana.1 Background On February 16, 2016, the United States and Cuba signed a Memorandum of Understanding (MOU) that allows for the resumption of scheduled air services between the United States and Cuba. For scheduled combination or all-cargo services to and from Havana, under the terms of the MOU, U.S. carriers may operate up to twenty (20) daily round-trip frequencies. For scheduled combination or all-cargo services to and from each of the other nine (9) international airports in Cuba, U.S. carriers may operate up to ten (10) daily round-trip frequencies, for a total of ninety (90) daily non-Havana U.S.-Cuba round-trip frequencies.2 Also on February 16, 2016, by Order 2016-2-12, the Department instituted the 2016 U.S.-Cuba Frequency Allocation Proceeding to allocate the 20 daily round-trip frequencies that may be used for scheduled combination or all-cargo services between the United States and Havana, Cuba to the carrier or carriers selected, and to allocate the 10 daily round-trip frequencies that are 1 The Department will address the applications for scheduled services to Havana subsequently. 2 The nine airports, other than Havana’s José Marti International Airport (HAV), that are authorized for international services are: the Ignacio Agramonte International Airport in Camagüey (CMW); the Jardines del Rey Airport in Cayo Coco (CCC); the Vilo Acuña Airport in Cayo Largo (CYO); the Jaime González Airport in Cienfuegos (CFG); the Frank País Airport in Holguín (HOG); the Sierra Maestra Airport in Manzanillo (MZO); the Juan Gualberto Gómez Airport in Matanzas (VRA); the Abel Santamaría Airport in Santa Clara (SNU); and the Antonio Maceo Airport in Santiago de Cuba (SCU). The MOU does not place limits on the number of carriers that may provide U.S.-Cuba services. available for scheduled combination or all-cargo service at each other point in Cuba to the carrier or carriers selected. The Department stated that it intends to award carriers that receive allocations underlying exemption authority to support their services. The Department also stated that it recognizes the eagerness of U.S. carriers to take advantage of these new Cuba opportunities and the benefits to the traveling and shipping public of enabling them to do so, and that it intends to reach a final decision in this matter as promptly as possible. Applications Seven U.S. carriers propose scheduled services to points in Cuba other than Havana. Each carrier requested an allocation of frequencies, and underlying exemption authority to support their proposed services.3 The non-Havana proposals are summarized below, and in chart form in Appendix A. American Airlines, Inc. (American) proposes to begin eight daily year-round scheduled combination services in five non-Havana U.S.-Cuba city-pair markets, beginning within 90 days of a final order.4 Specifically, American proposes (1) daily service between Miami and Camagüey, using 144-seat A319 aircraft; (2) daily service between Miami and Cienfuegos, using 144-seat A319 aircraft; (3) twice daily service between Miami and Holguin, using 160-seat B737-800 aircraft; (4) twice daily service between Miami and Matanzas, using 144-seat A319 aircraft; and (5) twice daily service between Miami and Santa Clara, using 160-seat B737-800 aircraft. Eastern Air Lines Group, Inc. (Eastern) proposes to begin year-round scheduled combination services in two non-Havana U.S.-Cuba city-pair markets using 147-seat B737-800 aircraft, beginning on or before July 1, 2016. Specifically, Eastern proposes (1) three times weekly service (i.e., Thursdays, Fridays, and Sundays) between Miami and Camagüey; and (2) three times weekly service (i.e., Mondays, Wednesdays, and Saturdays) between Miami and Holguin. Frontier Airlines, Inc. (Frontier) proposes to begin year-round scheduled passenger services in five non-Havana U.S.-Cuba city-pair markets, using A320 and A320neo aircraft with between 180 and 186 seats. Specifically, Frontier proposes (1) once weekly service (i.e., Saturdays) between Chicago and Matanzas, commencing on January 7, 2017; (2) daily service between Chicago and Santiago de Cuba, commencing on October 27, 2016; (3) four times weekly service (i.e., Mondays, Wednesdays, Fridays, and Saturdays) between Philadelphia and Camagüey, commencing on December 15, 2016; (4) once weekly service (i.e., Saturdays) between Philadelphia and Matanzas, commencing on January 7, 2017; and (5) three times weekly service (i.e., Tuesdays, Thursdays, and Sundays) between Philadelphia and Santa Clara, commencing on December 15, 2016. 3 The applicants have requested exemption authority of varying duration and scope. In the circumstances presented, in the interest of administrative efficiency, and consistent with the Department’s usual policy, the Department will grant the carriers two-year exemption authority for the specific U.S.-Cuba city pairs for which the applicants propose service. 4 With respect to its Miami-Matanzas proposal, American states that it will begin that service the later of 90 days after this final order or TSA approval. 2 JetBlue Airways Corporation (JetBlue) proposes to begin daily year-round scheduled combination services, beginning September 8, 2016, or within 100 days after receipt of all necessary approvals, whichever is earlier, using 162-seat A320 aircraft between (1) Fort Lauderdale and Camagüey; (2) Fort Lauderdale and Holguin; and (3) Fort Lauderdale and Santa Clara. Silver Airways Corp. (Silver Airways) proposes to begin year-round scheduled combination services in nine non-Havana U.S.-Cuba city-pair markets using 34-seat Saab 340B Plus turboprop aircraft. Specifically, Silver Airways proposes to begin (1) five times weekly service (i.e., not on Mondays and Fridays) between Fort Lauderdale and Camagüey, commencing on September 22, 2016; (2) three times weekly service (i.e., Tuesdays, Thursdays, and Saturdays) between Fort Lauderdale and Cayo Coco, commencing on November 17, 2016; (3) once weekly service (i.e., Saturdays) between Fort Lauderdale and Cayo Largo del Sur, commencing on December 8, 2016; (4) twice weekly service (i.e., Mondays and Fridays) between Fort Lauderdale and Cienfuegos, commencing on October 6, 2016; (5) daily service between Fort Lauderdale and Holguín, commencing on October 20, 2016; (6) three times weekly service (i.e., Tuesdays, Wednesdays, and Fridays) between Fort Lauderdale and Manzanillo, commencing on December 15, 2016; (7) four times weekly service (i.e., Mondays, Wednesdays, Fridays, and Sundays) between Fort Lauderdale and Matanzas, commencing on December 1, 2016; (8) daily service between Fort Lauderdale and Santa Clara, commencing on September 8, 2016; and (9) daily service between Fort Lauderdale and Santiago de Cuba, commencing on November 3, 2016. Southwest Airlines Co. (Southwest) proposes to begin year-round combination services, using 143-seat B737-700 aircraft, beginning within 90 days of the issuance of a final order (1) twice daily between Fort Lauderdale and Matanzas; and (2) once daily between Fort Lauderdale and Santa Clara. MN Airlines, LLC d/b/a Sun Country Airlines (Sun Country) proposes to begin winter season combination services between Minneapolis/St. Paul and two cities in Cuba other than Havana, using 126-seat B737-700 aircraft and 162-seat B737-800 aircraft. Specifically, Sun Country proposes (1) once-weekly service (i.e., Saturdays) between Minneapolis/St. Paul and Matanzas; and (2) once-weekly service (i.e., Sundays) between Minneapolis/St. Paul and Santa Clara. Decision The Department has decided to grant the applications of American, Frontier, JetBlue, Silver Airways, Southwest, and Sun Country.5 5 Based on officially noticeable data, the Department concludes that American, Frontier, JetBlue, Southwest, and Sun Country are qualified to provide the services proposed. Each carrier has been found fit to provide scheduled foreign air transportation of persons, property, and mail, and each holds exemption authority to provide scheduled combination services in various other international city-pair markets. No information has come to our attention that would lead us to question the qualification of these applicants to conduct the proposed operations at issue here. 3 In response to Order 2016-2-12, the Department received requests to serve each of the nine international airports in Cuba other than Havana. In no instance do these requests total more than the 10 flights per day allowed under the U.S.-Cuba MOU, and the applications are ripe for action. Furthermore, the requests of American, Frontier, JetBlue, Silver Airways, Southwest, and Sun Country are unopposed on the record of the proceeding. In light of these circumstances, the Department concludes that it is in the public interest to grant the requested frequency allocations and to grant the applicants underlying exemption authority to support their services.6 The Department has also decided to defer action on the application of Eastern. In reaching this decision, the Department notes that Eastern has not completed the necessary licensing steps to conduct scheduled air transportation, and that Eastern is currently limited to providing charter flights only.7 A number of carriers have questioned whether Eastern should be eligible to receive any scheduled Cuba authority at this time, particularly with respect to Eastern’s application for scheduled Miami-Havana authority,8 and the Department will consider the issue in the Havana portion of this proceeding.9 In the circumstances presented, the Department believes the best approach is to defer action on Eastern’s request for non-Havana frequencies and exemption authority at this time.
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