CP Air plans merge with existing air carrier

CP Air plans merge with existing air carrier
Ted Vallas, owner of California Pacific Airlines, announced that the airline now has plans to merge and eventually buy out an existing airline to receive FAA certification to begin flight operations out of the McClellan-Palomar Airport in Carlsbad. File photo

CARLSBAD — California Pacific Airlines (CP Air) is working on merging with an existing, certified airline to advance its plans to fly out of the McClellan-Palomar Airport in Carlsbad.

CP Air owner Ted Vallas stated Wednesday that he plans to merge with a small airline in the coming months and eventually buy it entirely to obtain the company’s FAA (Federal Aviation Administration) air carrier certification. Vallas said he would then be able to expand the existing certificate to cover the types of planes he plans on flying out of McClellan-Palomar Airport.

This would effectively circumvent the years of setbacks CP Air has experienced with its application to start an airline from scratch. The FAA rejected the airline’s initial certification application and has delayed the review of its current application due to lack of staff and resources.

“You’re immediately certificated,” Vallas explained. “It only takes a couple of months to add a new type of aircraft to the certificate.”

FAA spokesperson Ian Gregor confirmed that the FAA does allow airlines to do this.

“Airlines all over the U.S. add new aircraft models to their fleets from time to time,” he said. “It’s a much simpler process to add new models of aircraft to an existing certificate than to certificate a brand new airline.”

Though Vallas would not name the airline he intends to take over, he stated that it currently operates five Boeing 737 aircraft throughout the country.

If the merger and buyout are successful, Vallas intends to continue operation of the 737 planes and within two years operate a total of 12 Embraer 170 and 190 aircraft out of McClellan-Palomar Airport.

Sticking to CP Air’s original plan, the commercial flights would fly nonstop from Carlsbad to San Jose, Oakland, Sacramento, Las Vegas, Phoenix, and Cabo San Lucas.

The FAA most recently notified CP Air that it was further delaying the airline’s initial certification application due to limited staffing and resources in an Oct. 30 letter.

FAA Flight Standards Assistant Division Manager Keith Ballenger sent the letter to CP Air President and CEO John Selvaggio. The letter stated that the FAA will review its resources in early 2014 to determine if it can resume working on the airline’s application.

Until CP Air gains the necessary certificates to operate and expand the new airline, Vallas has suspended the company’s operations and furloughed all employees.

Vallas has maintained that through the years CP Air has pursued its FAA airline certification properly. He attributed the delays to FAA setbacks and holdups by San Diego County.

He has filed a multi-million dollar lawsuit against the county for breach of contract/warranty and for withholding information that affected the airline’s proposal.

“Under no condition ever (were we) in danger of not being certificated. It was just time delays by both the FAA and the county,” he said.

Contrary to other news reports, Vallas also insisted that the company has not sold stocks or held onto $11 million in investors’ money.

He said that the company’s $11 million consists of $8 million of his own money and only $2 million from investors.

He also stated that the company has refrained from selling stock until issues with the FAA and the county have been resolved.

“There is no danger of us not being able to move forward. It’s just a matter of how do we do it with the cutbacks that the FAA is imposing on everybody,” Vallas said.

Clarification 11/8/13: Clarification: The third paragraph of this article was changed to reflect that the FAA did not impose delays on CP Air’s certification application but rejected the airline’s initial certification application and has delayed the review of its current application due to lack of staff and resources.

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