Guam’s Szabo Aerospace Set to Start Scheduled Passenger Ops

The US Department of Transportation has indicated that it will approve an application by Guam’s Szabo Aerospace to operate scheduled passenger flights between Guam and the Northern Mariana Islands.

The department issued a show cause notice on September 3, 2025, giving 14 days to parties to stump up supporting evidence and file their objections. Otherwise, it will issue an order certifying Szabo Aerospace as “fit, willing, and able” to provide scheduled passenger services.

Szabo Aerospace, an established on-demand cargo and mail air operator, wants to operate scheduled passenger operations between Guam (GUM) - Rota (ROP) – Tinian (TIQ) – Saipan (SPN) up to three times per day using two Cessna 208Bs.

The flights will operate under the Micronesia Air Connection Service brand and take on local operator Star Marianas, who currently enjoys sole operator status around the Northern Marianas.

Szabo Aerospace filed its initial application in early 2024. The company, which is owned and controlled by husband and wife team, John and Paula Stewart, faced stiff scrutiny from the department. Among other things, it wanted to know whether Szabo has the management and technical expertise and financial resources to operate a scheduled airline.

The department also wanted to be satisfied that the company would and could abide by the relevant state and federal rules and regulations and that the Stewarts were fit and proper people, specifically US citizens.

All up, the department requested additional details at least four times, including in November 2025, and February and May 2026.

“No special issues regarding the applicant have come to our attention,” last week’s show cause notice reads.

Besides satisfying the department, Szabo Aerospace’s application faced opposition from Star Marianas and CCI Corporation

Both argued that Szabo Aerospace’s proposed operating model depended on “extraordinary” subsidies provided by the Northern Mariana Islands Economic Development Authority (CEDA). Szabo Aerospace secured a 22-year tax exemption from the authority. Szabo said that the exemption was legal and perfectly valid. It said Star Marianas and CCI could also apply for similar tax incentives.

The department concluded that Szabo Aerospace would have access to enough money to conduct its operations without posing a risk to consumers and their funds.

“We are not persuaded by the opposing parties’ arguments,” it said. “Szabo Aerospace is an existing air carrier, whose current operations have been conducted profitably. Moreover, the air carrier intends to meet its financial fitness requirements using a USD3.5 million letter-of-credit from the Bank of Guam."

"The air carrier is not reliant on any other funds to meet the department’s financial fitness criteria, and the opposing parties have not demonstrated how the tax exemption provided by CEDA is relevant in our determination of fitness for Szabo Aerospace.”

Per procedure, parties such as Star Marianas have 14 days to show cause why the department should not approve the application, which will come with conditions and limitations, such as restricting the type of aircraft Szabo can use under the authority to what it is currently.

Following the department’s decision, Micronesian Air Connection Service has opened bookings for flights from Saipan to Tinian, Rota, and Guam from mid-September.

Read the US Department of Transportation's show cause notice here.

Photo: AI generated image.