PenAir’s Investments Improve Rural Service
Five Saab 2000 aircraft added to the fleet
Unalaska Mayor Shirley Marquardt cuts the ribbon to PenAir’s SAAB 2000 at the Tom Madsen Airport on Amaknak Island at Dutch Harbor to welcome the community onboard to check out the new plane. From left, PenAir President Scott Bloomquist, Marquardt, PenAir CEO Danny Seybert, and guest Pat Geitz.
Photo courtesy of PenAir
Aviation in Alaska just got better. The family-owned airline PenAir, in business for more than sixty years, has invested millions in several bigger, faster aircraft to expedite and increase passenger and freight loads to Unalaska and Dutch Harbor as well as the Pribilof Islands and Bristol Bay. The airline Orin Seybert founded with a two-seater aircraft in 1955 has remained a family-owned business and is the oldest family-owned continuously operating airline in the United States. It has withstood a lot of changes in the industry and the state economic climate. PenAir is legendary in the Alaska aviation industry and throughout the United States.
The company continues to thrive and there is excitement about the latest endeavor. PenAir has been flying to Dutch Harbor since contracting the route from Alaska Airlines in 2012 as a CPA (capacity purchase agreement) partner with PenAir operating the flights and Alaska Air taking reservations. Danny Seybert, CEO of PenAir, says his business is “holding steady in Alaska” and he has recently invested in aircraft to improve rural service. “I’m bringing five Saab 2000’s on board and we are making about a $27 million investment in these airplanes. They are going to replace the majority of my fleet here in the state of Alaska.”
The aircraft are arriving in stages: three are in state now, two are being outfitted in Missouri. One is being customized for flights to St. Paul and St. George. It will have thirty seats and two cabins, one aft for life rafts and one forward for bypass mail, and then it can be flown over water to the Pribilof Islands. Another is getting outfitted with high tech upgrades including a satellite phone, instant real time weather, satellite data, and other safety features and efficiencies the first three were outfitted for before they were brought up a few months ago.
What led to the big investment decision? “High fuel prices,” Seybert says. “What started in 2008. We needed to become more efficient in our operation and the way we could do that was get bigger airplanes that go faster and haul more people more efficiently.”
PenAir is now flying more people on fewer flights with the Saab 2000 than on the Saab 340. Seybert says, “In Dutch Harbor last year we flew 1,600 flights. This next year I anticipate putting the same number of seats in the market with 900 flights.”
All those fewer flights pencil out. The Saab 2000 uses less fuel per passenger when allocated on a per passenger basis, so it is more energy efficient, plus it’s faster—100 knots faster. Those fifty-five thousand people flying to Dutch Harbor every year will gain time; instead of flying three or four hours, Seybert says, “with the new aircraft we’ll do it in two hours and be able to go nonstop without stopping for fuel—huge improvement.”
The Saab 2000 has other advantages as well. It is a smooth, quiet ride, with lots of legroom. The larger, slower propellers vibrate less and contribute to the smoothness of the ride, even in turbulence. During the flight, the noise canceling system makes it possible to carry on a conversation with traveling companions or take a quick nap while relaxing with stretched out legs. Seats have a thirty-four inch pitch—same as first class in narrow body aircraft. It’s nice for all the passengers who depend on PenAir for transportation through all the seasons.
One of PenAir’s SAAB 2000 aircraft sitting on the tarmac at Ted Stevens Anchorage International Airport ready for a flight to Dutch Harbor.
Photo courtesy of PenAir
A lot of companies have seasonal business, so does PenAir. “We have crab season, cod season, halibut season, salmon season, rockfish season,” Seybert says, naming more ocean dwellers.
“Our business is not affected by today’s recent economic problem with the state of Alaska,” he explains. “Depending on what they do with the budget it may very well be impacted by what they do in the future. As of today, the seafood industry is very healthy, and we have a very good marketing presence with the seafood industry.”
Seybert continuously meets rural Alaska aviation needs by providing transportation services where they’re most needed. “Depending on the season—in June and July Bristol Bay is our biggest market, in January Dutch Harbor is our biggest market, and then various communities depending on the fishing season. We’ll have a big spike for St. Paul, we’ll have a big spike for Cold Bay and Sand Point—we also do crab, halibut, and salmon openings.”
PenAir also delivers bypass mail to the communities they fly to in Bristol Bay and Western Alaska: King Salmon, Dillingham, St. George, St. Paul, Aniak, McGrath, and Unalakleet. They’ve been bidding on and winning Essential Air Service contracts in the Lower 48; they fly on the West Coast, the East Coast, and most recently were awarded some rural communities in the Midwest that will be routed out of Denver. Some of the Saab 340 aircraft that used to fly to Dutch Harbor will be going south.
Pavlof Volcano could be seen emitting steam on the return flight to Anchorage from PenAir’s SAAB 2000 inaugural flight to Dutch Harbor, May 6. Pavlof began erupting March 27 and again May 14.
Photo by Susan Harrington for Alaska Business Monthly
The business is doing well, and has for a very long time. That is no easy feat. There are reasons for PenAir’s long-term success.
“Well, first of all we have really good employees. We have many, many long-term employees that have been with us twenty, thirty, forty years, and they’re willing to step up and do what’s necessary to stay successful,” Seybert says. “And the other thing is we’re not afraid to change our business model when it’s not working as we desire or if we see opportunities to do something better we are very willing to change our company. I think that another big factor about why we’re successful is we’re not afraid to change.”
The consistent, dedicated leadership through two generations of Seyberts is another factor. Great customer loyalty and great customer service are two more factors.
“After sixty-one years my dad’s still involved. Also, we’re an Alaska Native owned company—we’re Alaska Natives,” Seybert says. “The consistency of providing a service to the region that is needed, such as supporting the people that live these communities. They can’t live or work in these communities without our support and we understand that. The businesses that run in these communities, such as the seafood industry and the businesses in tourism, they also couldn’t do their jobs if they didn’t have a good partner in us as their airline. So we’ve maintained those relationships for many, many years. Some of our customers go back to when my dad first started. Two of the seafood customers that were some of his original customers—Trident and Peter Pan Seafood—are still our customers sixty years later.”
PenAir CEO Danny Seybert welcomes a family boarding the first SAAB 2000 scheduled passenger flight to Dutch Harbor. May 7.
Photo courtesy of PenAir
The company is also diversified. Seybert explains: “We have really four distinct portions of our business. One is the bypass mail, which is about 10 percent. The second component is the people that live and work in the region. Third is the seafood industry, and the fourth is our cargo business. Among those four components, that’s what we do.”
And they are always improving something, whether it is the fleet, the facilities, or the operations. PenAir recently remodeled the terminal in King Salmon, preserving part of the old terminal as a visitor center. There is a culture of safety throughout the company. Per the codeshare regulation, they’re required to maintain the same level of safety as their codeshare partners, and they are subjected annually to safety audits by Alaska Airlines to verify that they follow all the regulations and that they incorporate industry best practices, which they do on a monthly basis. If they can find a way to do anything better, safer, more efficient, they do it.
For example, the recent introduction of iPads in the cockpits. Electronic flight bags are an improvement over traditional flight bags, which are the box kits that airline pilots roll behind them in airports; now all those navigation charts, books, manuals, maps, and calculators pilots need to do their job are conveniently accessed digitally on an Apple iPad and synced daily for updates. Less paper is used and more information is available to the flight crew. The iPad flight bag is about forty-eight pounds lighter, too. “Another suitcase you can carry,” Seybert says.
Focus on the Future
Seybert is also focusing on the future of the family business. His dad founded the business, several nephews and nieces and a daughter work for him, and his brother Lloyd is a pilot and director of operations. The company motto, “Spirit of Alaska,” signifies the spirit of helping others and cooperation. “The family culture that we operate under and the spirit of taking care of these communities and the people that fly with us. We are very much aware of the fact that we need to take care of them,” Seybert says.
The people in those communities are grateful to PenAir and excited about the Saab 2000. May 6 was historic for PenAir. The private inaugural flight from Anchorage landed first in King Salmon and then Dillingham to board Alaska Native leaders and other passengers for the journey to Dutch Harbor. It was an idyllic flight gliding above the Naknek River—flocks of swans and an abundance of other birds could be seen below, where the tundra looked parched and the river looked low. The flight continued across Kvichak Bay and over the Wood River to Dillingham. When the flight landed at Dutch Harbor, Unalaska Mayor Shirley Marquardt and a couple hundred people turned out to welcome the passengers and celebrate the arrival of the Saab 2000. There was a community wide open house with a ribbon cutting and tours of the plane; the terminal was full of people for hours, with speeches, great food, and a lot of happy people excited about future flights on the new aircraft.
Seybert’s plans for PenAir’s future? “Well, we plan on giving better service to our communities in Alaska with the use of a bigger, faster airplane. We expect better baggage handling, with more efficient flying, so we are enhancing our Alaska operation as well. We pretty much stick to our traditional route structure that was formed many years ago, which is serving Bristol Bay and the Aleutians and three cities in Western Alaska. Focusing on the longevity of the family—we are going to continue the family tradition and be in the airline business for a long time to come.”
Susan Harrington is Alaska Business Monthly’s Managing Editor.
This article first appeared in the July 2016 print edition of Alaska Business Monthly.