We are extremely grateful that the LA Times covered our launch and took the time to talk to Tom (of New Vectors Aviation – our operator) and me.

However, since this is a new type of service, a number of misconceptions crept into the article that we have an obligation to correct immediately to avoid misrepresenting anything to the general public.

We owe anyone using our service and flying with our operators to know exactly what is going on and what each entity is responsible for.

We will ask the LA Times to correct this information.

A) The article starts with

The company will fly passengers between more than 28 municipal and commercial airports from Santa Barbara south to San Diego and as far east as Las Vegas.

We do not fly. New Vectors – our operator – is the company that does the flying. It is very important that anyone who uses the service, understand that they fly with an FAA-certified carrier. FlyMiwok simply helps operators with bookings and provides them with a portal. We have nothing whatsoever to do with flight operations.

B) The caption for my picture says

Gad Barnea, founder of FlyMiwok, looks over a plane that will be used by the private air service at Santa Monica Airport.

This is not really an error – if you read it right. But it could be read incorrectly. So, just to put things straight: There’s no private air-service based at Santa Monica airport. Our operator(s) will pick customers up from Santa Monica, but none of the operators were working with or currently talking to is based there.

C) The article continues:

FlyMiwok is not an airline. It’s more like an air-taxi company that can fly passengers […]

True – we’re not an airline. But we’re not an air-taxi company either. We do not fly. New Vectors and the operators we represent are.

D) On pricing:

On FlyMiwok, the prices vary by distance, but on average a flight from Santa Monica Airport to Palm Springs International Airport will cost about $1,950. You can cut the cost by splitting the ride with other passengers.

That’s for a round-trip assuming a weekend-long stay. Same-day returns will cost less and by splitting the costs the round-trip can cost you $650.

Again, this is no fault of the LA Times. We understand that this is a new service and many people will have to translate it to something more familiar. We just need to keep the record straight.

Gad Barnea – CEO – FlyMiwok, Inc.

Dear friends,
It has been about 3 months since our "soft launch" and the first flight by our operator – New Vectors Aviation – and almost 4 years since we started conceiving of FlyMiwok (then Miwok Airways) as a way to re-think and re-do the on-demand air-travel market.

Now, today, Saturday 11/7/2009, I am very [very] excited to report to you all that we are officially open for business. Go to http://flymiwok.com where you will experience the first ever revenue-management and flight booking system for on-demand operators and air-taxis.

Now anyone can go online to check out pricing, book flights and manage their account right from their computer.

The Los Angeles Times covered the launch of our business today. As I mentioned in my previous emails, with the economic downturn also came a number of changes to our business model to allow us to bootstrap the business while expecting lower demand, higher dead-head ratios, more volatile fuel prices, tight credit and greater marketing challenges. Thus also, initial prices are higher than what they will be when demand builds up.

As exciting as this major milestone is, it is just the 1st step. Now, we need to build a loyal customer base and get the demand to where we want it to be.

Expect a lot of marketing activity in the next few weeks.

We thank you all for your support over the years.

Have a great day!

Gad Barnea – CEO – FlyMiwok, Inc.

Yesterday, Qatar Airways operated the first commercial passenger flight fueled by a mix of synthetic fuel made partially from natural gas. The aircraft, an Airbus A340-600 using Rolls-Royce Trent 556 engines, was fuelled by a roughly 50:50 blend of GTL kerosene and standard jet fuel, a mix that has won regulatory approval.

The six-hour flight from London to Doha used fuel supplied by a Shell gas-to-liquids (GTL) plant in Malaysia.

For Qatar, this is much more than just a clean-energy/alternative-energy demonstration as Shell and the state-owned Qatar Petroleum are building the world’s biggest GTL plant – the “Pearl GTL”. They expect to start producing “GTL kerosene” approved for use in jet fuel in early 2012.

When the Pearl GTL project is fully completed, it will process about 1.6 billion cubic feet a day of gas from Qatar’s giant North Field, the largest gas field in the world, into 140,000 barrels per day (bpd) of GTL products.

If you have been following this blog for a while, you probably know that we at FlyMiwok are very excited about the promise of synthetic fuels, and every day there seems to be another significant step taken in order to make this a reality. Certainly, the first commercial flight – with paying passengers on board – powered by a synthetic-fuel mix is a cause for celebration.

Gad Barnea – CEO – FlyMiwok, Inc.

"The corks were popping out of the bottles like the old Jiffy Pop we grew up with," said Highway Patrol Lt. Scott Keane as he described the emergency crew’s experience trying to put out an intensely hot fire after a semitrailer crashed on Interstate 80.

The cargo? various wine bottles of merlot, pinot noir, reisling and sparkling wine from Washington and Oregon – with a retail value of $20 to $50 each.

Thankfully, no one was injured in the accident.

“There’s nothing left of the cab or trailer," said Theresa Herbin, public relations specialist for the Wyoming Department of Transportation. "There were a few bottles that didn’t explode," but they vanished overnight.

With the electrons not yet dry on my last blog post on USA Today’s biased and misleading report – I got word that NBC’s Today (a show I never watch) is following in their footsteps as part of a media blitz by the airlines that I expect will go into overdrive in the next few weeks. At least NBC’s report was a little bit more balanced.

The passing of Patrick Swayze yesterday at the young age of 57 of pancreatic cancer was a sad ending to a 20 month struggle with the disease that was fought with dignity and courage.

But to anyone concerned with aviation safety, Mr. Swayze’s record was horrific. Many people don’t know that Patrick Swayze was an instrument-rated private pilot and flew a twin-Cessna 414 (N414PS) regularly from Van Nuys airport in Southern California to his ranch near Las Vegas, NM (that’s New Mexico – not Nevada).

On June 1, 2000 – according to the NTSB report – Swayze’s aircraft with himself and his dogs on board, hit light poles while attempting to perform an emergency landing in a housing development near Prescott Valley, AZ. The pilot and his two dogs were not injured.

The NTSB report is very interesting. According to Swayze, he was in

cruise flight at 13,000 feet mean sea level (msl) when he heard a loud sound. His ears “popped” and his dogs began barking. Concerned that he had lost pressurization, he looked for a suitable landing site. He reported being confused and had a hard time seeing his instruments. After seeing what he believed was an airport below, he circled the field to the left and initiated an approach from the west. On short final, he noticed a truck parked on the left side of what he believed was a runway near the approach end, and lengthened his approach to clear the vehicle by 4 or 5 feet.
Just prior to touchdown, the airplane’s right wing struck a light pole, and lost about a 4-foot outboard section. The airplane then touched down, bounced, and touched down again. It crossed an intersection, and struck a stop sign and another light pole. The airplane then veered right, off the paved portion of the roadway, and struck an electrical utility box with outboard section of the extended left flap. The airplane came to rest, facing south, about 200 yards from the first impact point.

The story continues with 4 witnesses on the ground helping Swayze remove evidence of liquor on the plane

According to the witnesses, the pilot appeared to be looking for something in the airplane. One of the witnesses offered to help. The pilot stated that he was looking for a bottle of wine, which the witness found beneath one of the aft seats. Both the pilot and the witness then exited the airplane with the bottle of wine, which was 1/3 full. Another witness put the wine bottle in his toolbox. The pilot then asked the witnesses to make up a story about what they had seen. They agreed to tell people that they were away at lunch when the accident occurred, and that they saw the pilot and his two dogs walk to the road and hitch a ride.
Three of the four witnesses returned to work and one stayed with the pilot. The pilot asked the remaining witness if he was in New Mexico, and was told that he wasn’t. The remaining witness then offered to drive the pilot into town.

3 of the witnesses were cited for providing false information to police.

Swayze confessed to the NTSB inspectors that he has been smoking 3 packs of cigarettes a day, as well as cigars. The loss of pressurization story appears likely, since the pilot smoked in the aircraft and inspectors found that

The cabin altitude controller’s inlet filter was approximately 75-percent blocked. The contamination appeared to be by-products of cigarette and/or cigar smoke;

Mr. Swayze was extremely lucky to have survived this accident. Not knowing what state you’re in and mistaking a housing development for an airport is serious impairment. There was never any conclusive evidence that Mr. Swayze was under the influence of alcohol during the flight and the witness said that he did not smell alcohol on the pilot. However, he was not examined by law enforcement until 10 hours after the crash, so I guess we’ll never know.

As utterly irresponsible and reckless as he’s been as a pilot, he has shown admirable courage and dignity in his later years. Our thoughts and prayers go to Mr. Swayze’s family.RIP.

Kudos to Virgin America for signing Chris Cornell to be a featured artist on its flights system-wide starting in October. Tracks from the former Soundgarden and Audioslave frontman’s ‘Scream’ album will be played as passengers board flights and will be available through Virgin’s music library.

Trips to the black hole sun will probably not be part of the deal.

Here’s ‘Scream’ for your listening pleasure (will redirect you to YouTube):

The Financial Times recently discussed how – even though the CFTC has not yet formally announced any new rules on “speculation” – fear of these rules is already affecting some very big names.

Barclays Global Investors said yesterday that it temporarily stopped creating shares in the $1.43 billion iShares S&P GSCI Commodity-Indexed Trust (GSG) – one component of the largest ETF in the world. The reason: “uncertainty” from potential new commodity rules.

Barclays’ iPath Dow Jones-UBS Natural Gas ETN, Deutsche Bank’s PowerShares DB Crude Oil Double Long ETN also made similar moves and the United States Natural Gas Fund, or UNG said it would halt new share issues because of “current and anticipated new regulatory restrictions and limitations”.

Putting the horse before the carriage and acting even before publicly announcing details about position limits, the CFTC has already imposed trading limits in IntercontinentalExchange’s (ICE) US over-the-counter natural gas swap. Last week it also yanked exemptions from limits on corn and wheat futures issued to Deutsche Bank and New York-based commodity manager Gresham Investment Management.

The article quotes Bart Chilton – an CFTC commissioner – as saying that the agency’s “antennas” go up whenever a single trader holds positions that breach certain levels.

“Regulators should be commodity-blind and price-neutral. That said, prices have to be fair and based upon economics, not on a trader or traders who have concentrated market-moving positions.”

The CFTC could theoretically decide “what’s fair” – but it should be about promoting transparency, not deciding “economic fairness”.. Commodities trading as we’ve said numerous times on this blog is a global affair and what’s fair here might – and probably won’t – be viewed as fair by OPEC. Nor would they care.

Along the lines of our analysis in this blog, John Hyland – Chief Investment Officer at United States Commodity Funds, UNG’s manager, said:

“The proposed direction the CFTC is looking to go is likely to produce results that are very much the opposite of what they seem to desire, They apparently are seeking an outcome of low prices and low volatility as being an ‘ideal state’. By eliminating financial investors from the marketplace and leaving it totally in the hands of oil companies, physical energy traders, and Opec, they are likely to end up with neither low prices nor low volatility.”

Indeed.

Gad Barnea – CEO – FlyMiwok, Inc.

An article in USA Today this morning talks about the aftermath of the infamous delay earlier this month that left a full plane with 49 passengers and 2 children held on laps (the plane seats a maximum of 50) stranded from about midnight to 6am at Rochester, Minn. with a culinary choice of pretzels a la mode for dinner and an all you can eat pretzel buffet for breakfast with the magnificent view of Rochester’s tarmac from their window.

The flight was a Continental Airlines flight operated by ExpressJet and was forced to land at Rochester because of bad weather. Neither Continental nor ExpressJet had ground crew at Rochester so the crew asked the only carrier able to help them at Rochester – Mesaba Airlines – to help arrange for passenger deplanement or a bus to transport the passengers out of the plane. According to reports, Mesaba refused.

Now, Mesaba is a subsidiary of Northwest Airlines, now owned by Delta. So, were talking 5 different carriers essentially mixed up in this charade.

According to the DOT preliminary press-release, it was determined that the crew was not at fault and there was a “There was a complete lack of common sense” by Mesaba in this case – ya think!?

Cranky Flier has a great analysis of the incident if you want to know more, but in our view more than anything, this was a testament to just how incompetent and bureaucratic the airline system is a whole. The DOT report goes on to say “It’s no wonder the flying public is so angry and frustrated.” These runway tarmac “parties” happen all too often (SunCountry just had another one last Friday). And an analysis by USA Today has a graph of tarmac delays with – you guessed it – ExpressJet at the very top, followed by Comair and Continental.

FlyMiwok operators don’t need to wait on the tarmac for the cooperation of some unfamiliar ground crew, they use general aviation terminals that don’t require special procedures and have unlimited license to use common sense. Compare that to airline procedures that tangle up any crew initiative in pretzels upon pretzels of red tape.

Gad Barnea – CEO – FlyMiwok, Inc.

During last year’s massive run-up and subsequent run-down in oil prices, many airlines made hedges that caused the business to incur a massive loss.  Delta’s second quarter loss included a $390 million loss attributed to fuel hedging alone. This pales in comparison to Cathay Pacific Airways which took an almost $1 Billion loss.

A recent Wall Street Journal article, discusses fuel hedging plans by the airlines for 2010 and beyond. Based on recent experience, most airlines are understandably hesitant to hedge aggressively – or hedge at all..

The article mentions that United, Delta and JetBlue have hedged 8%, 9% and 10% of their fuel needs respectively for 2010, while Continental remains un-hedged.  

Southwest Airlines – the master-hedger of the airline industry – remains aggressively hedged at 47% helped by it’s massive cash reserves. This is a substantial risk for Southwest, but it’s a risk they understand well and even if it will cause the airline to pay more for fuel in certain situation, at least it will make business and operations planning easier, by avoiding to have to deal with fuel price spikes that inevitably happen in today’s economy.

FlyMiwok’s operators do not use Jet fuel. They use 100LL AvGas -  for which there’s practically no real hedging experience.  As the recent experiences of the airline industry has shown us fuel hedging can quickly become a double-edged sword. However, helping our operators cut costs is a major concern for us and we will review and study possible hedging scenarios in the future to explore its impact on our operator’s bottom line. 

Gad Barnea – CEO – FlyMiwok, Inc.