SATA - The Atlantic and You ™

SATA’s commercial strategy for 2012 pursues the fundamental goal of facilitating and increasing flights between the Azores and the world, namely with the outbound travel markets of Europe and North America, visibly boosting flights from expat communities and major outbound tourist markets to the Azores, particularly the U.S.A., Canada and Germany.

SATA’s strategic commercial plan for 2012 is aimed at reinforcing the importance of the Azores’ geographic position in the North Atlantic to promote the flow of tourists to the Azores from Europe, the U.S.A. and Canada, including the expat market (“mercado da saudade”).

As such, this plan will involve reinforcing and facilitating flights from Europe to the Azores, while simultaneously implementing a collection of measures aimed at encouraging traffic from the American continent (United States and Canada), with particular emphasis on partnerships with key North American airlines.

In the American and Canadian market, one of the first measures was to obtain the status of regular operator for both countries which, among other advantages, gave SATA a presence in all of this market’s computerized reservation systems and online channels. Following this change, the
number of flights to the United States and Canada was increased, with a subsequent and anticipated rise in passenger traffic, leveraged by efforts to offer the most competitive fares.

Finally, along the same lines, agreements were signed with leading airlines such as US Airways (in the U.S.A.) and WestJet (second largest airline in Canada) aimed at expanding SATA’s network to every American state and every Canadian province by offering these airlines’ same destinations, but at more competitive fares negotiated specifically under these partnerships.

With regard to Europe, the focus in 2012 will be to increase both the number of operating flights and capacity which, in practical terms, means serving more outbound tourist markets with more flights.

The first and foremost of these are flights to Frankfurt, Germany's main airport and one of the biggest airport hubs in the world, which serves more than 53 million passengers per year. For 2012, 24 additional rotations are planned between Ponta Delgada and Frankfurt in the coming off‐season and mid‐season, representing a 47% increase with 7,755 more available seats.

In addition to more flights between Frankfurt and Ponta Delgada, starting 31 March 2012, a new Ponta Delgada/Porto/Munich/Porto/Ponta Delgada flight will be offered on Saturdays.

This new flight will allow solid growth in passenger traffic, since Porto is among the fastestgrowing European airports in terms of passenger traffic, while SATA Internacional’s current Ponta Delgada/Porto/Ponta Delgada and Terceira/Porto/Terceira flights have also seen sustained growth in the number of passengers transported. Moreover, the Munich airport (Germany's second largest, with annual traffic exceeding 34 million passengers) has seen strong growth in passenger traffic. In addition, Munich's greater metropolitan area has more than 2.5 million inhabitants, with major industrial and tourism sectors, thereby generating a constant flow of both business and holiday travellers. In view of the direct flights between the Azores and Munich, SATA will be promoting the Azores destination in the region of Bavaria (one of the most populated and wealthiest parts of Germany) as well as eastern Austria and
northern Switzerland, which are characterized by high purchasing power, and are often served by the Munich airport.

SATA’s strategy in Europe has also been guided by what is considered to be the most stable market with the highest standard of living on the entire European continent: Scandinavia. The various weekly flights between the Azores and Copenhagen, Stockholm and Oslo have strengthened SATA’s brand in these markets, while simultaneously consolidating passenger traffic between the Azores and northern Europe. Beginning in May 2012, a new flight will be inaugurated, operating on Thursdays between Ponta Delgada/Porto/Copenhagen/Porto/Ponta Delgada, once again fully capitalizing on the solid growth seen in the Porto Airport and the entire area that it serves, spanning central and northern Portugal as well as Galicia.

The regular flight status for the new flights to Munich and Copenhagen, given these airports’ importance, will capture traffic from northern, central and eastern Europe to the Azores, which will be further promoted by suitable partnerships with other airlines.

In this way, SATA will be reinforcing its position in Germany and Scandinavia in 2012, while maintaining its position in England (London) and the Netherlands (Amsterdam), clearly boosting the number of flights between the Azores and Europe. For France, SATA has established a partnership with TAP (code‐share agreement) and the French airline Aigle Azur (interline agreement).

Similar to what has been done in the North American market, the signing of agreements with key airlines such as Aigle Azur (France), Aeroflot (Russia) and Malév (Hungary) complements SATA’s position in Europe by offering more flights and destinations which, although not flown directly by SATA, are available through its website (www.sata.pt) at highly competitive fares specifically negotiated for SATA.

SATA’s 2012 operating plan is, on the whole, similar to that of 2011, with the notable exception of boosting Azores/Europe flights and focusing on partnerships with leading airlines.