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Vol. 15, No. 32 Week of August 08, 2010
Providing coverage of Alaska and northern Canada's oil and gas industry

AK-WA Connection 2010: Family-run airline prepares to soar

TransNorthern Aviation could parlay its diverse experiences into charter services connecting Alaska with the Lower 48, Canada

Rose Ragsdale

Alaska-Washington Connection

After 15 years of Alaska-style adventures, TransNorthern Aviation is ready to take its “Mom and Pop business” to Seattle and beyond.

The Anchorage-based airline offers scheduled and on-demand air transportation throughout Alaska with many destinations in Southcentral Alaska, filling a slot in the aviation industry that few others approach.

TransNorthern took off in 1995 when two young Alaska pilots, Andrea Armstrong and Alan Larson, got together as business partners and scraped together $1,000 in seed capital to begin offering flight tours out of Talkeetna around and over the summit of Mount McKinley in a Cessna Caravan.

A few months after startup, the business direction of the fledgling airline took a 90-degree turn. A geophysical survey company in Houston, Texas, asked the Larsons to help test new airborne gravity survey equipment. Though the job meant cutting holes in their only Cessna Caravan, the Larsons grabbed the opportunity to fly gravity and magnetic surveys throughout the United States and abroad.

“We worked out a very lucrative contract with the geophysical firm and went from doing $200/person flightseeing trips to doing $200,000 contracts in a heartbeat,” Andrea (now Larson) said in a recent interview.

Continuing to work out of a cabin near the village airstrip in Talkeetna, TransNorthern soon opened a second office in Houston as the new focus took the couple as far afield as Argentina and Cambodia.

Operation moves to Anchorage

Four years later, Armstrong (by then Andrea Larson) took on the leadership role at TransNorthern, becoming general manager and 100 percent owner. Alan Larson continued to support the business by toiling long hours as a pilot and the company’s records keeper.

The survey work ended in 1999, and the Larsons moved TransNorthern to Lake Hood in Anchorage.

“We still had an airplane that we had to make payments on, so we left Talkeetna and started doing scheduled flights to Kenai. And we put a couple of King Air aircraft on our certificate,” Andrea Larson said.

The twin-engine, faster planes enabled the airline to fly medevac services out of Kotzebue, transporting patients from Northwest Alaska villages and Kotzebue to Anchorage for the Maniilaq Corp. for two years.

TransNorthern also began ferrying passengers and their gear to remote wilderness lodges in Alaska and flying on-demand charters, using a growing fleet of small planes that included Beechcraft 99s, Beech 18s, and a Cessna 402. This proved to be a reliable seasonal business that the airline continues to land.

Larson said operations grew rapidly, and the airline’s work force mushroomed to 40 people.

Worried that TransNorthern might lose its focus, Larson said she worked to scale back to about 15 employees. “We were becoming a faceless airline,” she said. “I wanted to go back to a smaller operation where we could pay more attention to our customers.”

Super DC-3s add new dimension

During those first years in Anchorage, the Larsons noticed market demand for aircraft with bigger payloads than the Beech 99 – which can haul about 2,500 pounds – but smaller than other available cargo planes such as the DC-6. Taking a chance, they purchased a military R4D8 in 2001 and spent nearly a year working to get authority to convert the aircraft into a 19-passenger Super DC-3.

No other aircraft is better suited to carry 19 people and their gear to short, sometimes muddy gravel runways in Alaska than the Super DC-3, Andrea Larson said.

A few years later, TransNorthern purchased a second Super DC-3. Now N30TN, this plane flew its first-ever commercial flight in June 2004 for the Alaska Sportsman’s Lodge on the Kvichak River near Igigug.

The aircraft remains in high demand for flying passengers throughout Alaska to various fishing and hunting lodges, on flight tours and for on-demand aircraft charters.

“It’s difficult for other aircraft to successfully land with 19 passengers and 2,000 pounds of cargo on 3,000 feet of runway,” she said. “Our passengers say that flights in the Super DC-3s are an incredible and unique experience, but we fly them because they are perfect for getting in and out of remote Alaska airstrips safely and efficiently ... plus they’re really cool.”

Today, TransNorthern maintains one of the largest “Super” fleets in the world with four of the aircraft. Two are configured for passenger services with 19 first-class seats and separate custom baggage and gear compartments that hold a ton of cargo with additional carry-on storage under the seats. The others are cargo Supers that can haul up to 7,500 pounds – anything that will fit through the 7-by-5-feet cargo doors can fly, boasts TransNorthern on it website.

The airline also operates Twin Turbine Metroliners and Beechcraft 99 aircraft – all of which can transport passengers, cargo and combination charters on demand to anywhere in Alaska, Canada and the Lower 48.

Larson said the twin-turbine Beechcraft 99 and Metroliner aircraft easily seat nine passengers with plenty of legroom and great visibility, along with separate baggage-cargo compartments for a safe and comfortable ride.

The airline introduced the turbine aircraft to its fleet when it landed a United Parcel Service contract for freight deliveries to Kenai, Homer and Kodiak a few years back, and when it won a similar FedEx contract a little over a year ago.

To win the UPS contract, TransNorthern convinced the international carrier that it was a small enough company that could give it really good service, Larson said. “After that, FedEx approached us. Perhaps it was because they heard about the job we were doing for UPS. … Those contracts are good to have. They keep the lights on.”

TransNorthern also regularly flies fresh seafood from such fishing hotspots as Kodiak, Homer, Kenai and to Yakutat from the Tsiu River to connect with Alaska Air Cargo’s Lower 48-bound flights in Anchorage.

The variety of services reflects an aggressive approach to seeking out new business, Larson said. For example, “we saw we were light on lodge work, so we actually approached several (lodges) and got more business,” she said.

The small commercial aviation community in Alaska also affects how TransNorthern does business. “Rumors fly pretty quickly. We see something, we jump on it,” Larson said. “In Alaska, among people who want to ship cargo, it is word of mouth that works, so it’s fortunate we have a good reputation.”

Still, Larson recently began working with a local marketing firm, Northwest Strategies, and publishing a monthly newsletter to advertise special rates and other promotions to customers as opportunities arise. “We are getting an increase in new customer contacts as a result,” she observed.

Larson also acknowledges the growing power of the Internet, especially in helping travelers outside Alaska find the airline. “The Internet is absolutely key to our business,” she said.

Service makes a difference

The airline’s “hands-on” approach also brings in new customers. “It sounds cliché, but we’re always paying attention,” she said.

Service is what sets the airline apart and that distinction would not be possible without the dedication and skill of her employees, who each routinely perform two or three jobs for the firm, she said.

The director of operations, for example, also is a licensed mechanic who works on the planes, flies the UPS run to Kenai and Homer and pilots some aircraft charters. Another mechanic also flies one of the Super DC-3s.

At first, multiple duties for employees happened by chance, but it soon became a conscious management decision, Larson said.

“When we put out to hire a pilot, if the candidate also had a mechanic’s certification, we would hire that individual,” she said. “Other airlines call our mechanics to do their more complicated or specialized work.”

To help minimize worker turnover, the airline added a retirement program to employee benefits in 2009 and introduced 100 percent company-paid health care insurance, with a provision for adding family members to the coverage at the employee’s expense.

“I think the only way to have a decent company is to have secure and happy employees, and one way to do that is to offer health insurance and incentives to stick around. It’s not that hard to do, if you are creative and make it one of the priorities,” Larson said.

Good records remain vital

She said another important factor in TransNorthern’s continued success is the absolute dedication of Alan Larson to maintaining the airline’s business records and regulatory certifications.

“Everyday, with FedEx and UPS, we have to close out flights, and with all our flights, we are required to maintain meticulous flight and maintenance records. The FAA does audits on a regular basis. That’s why we keep our records and operations very clean,” she said. “It’s so important to know what you are talking about and how to do things right. People don’t want to get in the airplane if they see any kind of disorganization.”

Larson said that is why her husband works hard to ensure that the airline complies with all legal and safety guidelines. In his spare time, he also helps out as a pilot.

“(Alan) gets here about four in the morning to start records … He is a very busy guy,” she said.

Larson, meanwhile, manages day-to-day operations at TransNorthern, handles the company’s marketing efforts and oversees everything else, including answering the phone.

“Communication is really a biggie,” she said. “When somebody calls here, I can answer any question. I can make the decisions quick, so I end up answering the phone. That’s why I made an effort last year to find the right people to answer the phones. But during the summer, I still end up answering the phones a lot.”

Larson said she and her husband work hard because they like to work. “We have a 12-year-old kid, and he comes in to help out at times, throwing bags and selling t-shirts. Early on, we kept a scanner on at night. Now, we monitor the business with a flight-tracking system on the computer. We also live on an airport (in Wasilla) and when it gets really late, we sometimes fly home for the night. We like to work,” she added.

Larson said she believes the airline’s customers will remain loyal even if rates go up. “But we try to stay competitive, and we keep an eye on competition,” she said.

Since 2002, TransNorthern’s revenues have grown 10-15 percent annually. Last year, sales hovered at $2.2 million, and the outlook for 2010 shows more growth ahead.

In the future, TransNorthern would like to offer more scheduled services and establish a larger presence in Anchorage.

“FedEx has approached us about doing a run between Seattle and Southeast Alaska cities, but the economy kind of turned and they are holding on that,” Larson said. “We are ready though. We know how to run a business from an out station, and we have people who have offered to go to Seattle and run it, as well.”

In Anchorage, “what we’re looking to do is build a larger hangar here and offer a flight base of operations. We’d also like to be better established physically at the airport, with a more convenient passenger loading and freight delivering facility,” she said.

The airline also wants to parlay its authority to fly to Canada into scheduled service to Dawson City, Yukon Territory.

“I hear rumors that Dawson City would like to have someone come in there, and we recently spent a week there checking out potential operations while shooting some aerial (footage) in a movie. It’s a possibility, but the airplanes would have to stay consistently full,” Larson added.

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