Private Jets In A World With COVID-19

Airlines are cutting flights as much as 90% for the foreseeable future. It’s unsure how soon networks and frequency will be restored. Before the COVID-19 Coronavirus pandemic, those flights took millions daily to important business meetings, family visits, long-awaited vacations and short-weekend getaways.

Hub flights to smaller cities will be the last to normalize, predicted David Best, a senior vice president of General Dynamics’ Jet Aviation. He was speaking yesterday morning during an online panel hosted by Corporate Jet Investor for industry executives.

About 80% of U.S. private flights are under two hours, driven by the efficiency of flying nonstop instead of connecting.

“85% percent of the over 600 business aviation executives are very or fairly optimistic about their company’s future”

The safest way to travel is by Private Jets In A World With COVID-19.  Then there’s the issue of not getting sick when you travel. With over 95,000 COVID-19 deaths in the U.S., until there is a vaccine or cure, social distancing and minimizing situations where we are in large groups of people will be paramount.

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An observatory study done by European private jet charter operator Globe Air found that transiting passenger terminals at airports and flying on a commercial airliner creates around 270 possible person-to-person interactions where one could be exposed to Coronavirus versus less than 20 on private flights.

That research doesn’t even account for bacteria, germs, and fungi that could be lurking on the surfaces of aircraft cabins. It’s not just your tray table. The Canadian Broadcasting Corporation found your headrest had the most filth. Its report noted nearly half of the surfaces swabbed on airline flights contained levels of bacteria or yeast and mold that could put a person at risk for infection. So the safest way is to fly by Private Jets In A World With COVID-19.

All of the above leads many in private aviation to expect an influx of new fliers. Eighty-five percent of the over 600 business aviation executives on the Corporate Jet Investor webinar said they are very or fairly optimistic about their company’s future, even though business for many is off by as much as 80%.

“Flying privately won’t add years to your life, but it will add years of enjoyment to your life.”

Whether it’s health risk concerns or just getting where you need to be, people and companies that have the means to fly privately, but had previously eschewed it, are now looking at the options.

If you’re a person who may have flown privately a few times, or not at all, and never justified the time savings, privacy and efficiency, but are taking a fresh view, this guide is designed to point you in the right direction.

Where do I start?

Excellent question, and one that believe it or not, alpha successful folks don’t always consider as they charge in. The most common source of new customers for private aviation providers are referrals from current customers. Some even offer current customers incentives to recruit new ones.

Knowing your friend flies with X and he or she is happy is good to know. That said, your friend’s travel needs maybe different from yours, so the solution that works well for them, may not be a fit for you.

What are the best private jet options for me?

One-off charters are the typical entry point. In industry lingo this is called on-demand. The next option is some sort of jet card or membership program. It’s another form of charter. In the U.S. alone, there are more than 60 providers with policies and benefits varying widely. In fact, I’ve identified over 65 variables that can impact which program is right for you. But AirCharter.com offers you an inventory of over 13,000 aircraft at the best prices possible, when you submit a trip request we have over 80 air carriers bid for it.

Fractional ownership and leases are also popular and bring you many of the same perks as owning your own jet, but come with commitments of three to five years. Then of course, you can own your own aircraft, and here the choice is not only type, but new versus used.

It’s often said if you plan to fly under 25 hours per year, charter on-demand. For 10 to 100 hours, look at jet cards and memberships. From 50 to 400 hours, fractional shares or lease might be right, and over 200 hours per year, full aircraft ownership is a realistic consideration. However, your needs might guide you down a path outside these generalities.

Be careful of friends who offer to share ownership or deals to fly on their private aircraft. You could be entering into an illegal charter.

How do I choose?

The biggest mistake I see with first-time buyers or private aviation is thinking you only need to choose one. While you may find a single provider that meets all your needs, think of your private aviation solutions likes cars in your driveway.

You may need more a couple different types. Chances are you aren’t going to drive the Rolls Royce to the mountain house in the winter.

So let’s review the options, and how they might fit for you.

On-demand Charter

This is by far the place most people start, and even here you have choices. You can book your flight with AirCharter.com, which will assign it to the lowest biddine Operator the company that will be flying you, AirCharter.com is an intermediary who reviews options from a variety of operators, and then presents you with those best fitting the needs you articulated. And the safets way to travel is Private Jets In A World With COVID-19.

Think of it like going to Prague for the first time. You could spend hours reading reviews of different hotels, and then book direct, or you can get a good travel advisor such as AirCharter.com who takes the time to figure out what you want, and then matches you to a hotel that best meets your needs.

Not to get too far in the weeds, but since you will find out anyway, who owns the airplanes you charter varies. In some cases the operator owns or leases the aircraft. In others, they serve as a management company for owners who rent out their private jets when they aren’t using them.

The latter is important, because when receive quotes back, payment, cancelation and usage terms can vary, even if two are from the same operator. That’s because two individual owners may have different stipulations in their contracts with the same management company.

With on-demand charter you book trip by trip, and AirCharter.com prices out each trip per your request, so you don’t have to worry about long-term commitments. In Fact its cheaper than a Jet Card Programs or Fractional ownership.

Still, for novices, it can be confusing. Why do two Bombardier Challenger 350s, each with eight seats, each manufactured in 2015, have different charter prices?

It could be the rates the owners want based on their cost structures. One may have three full-time pilots to rotate through vacations and sick days, while another uses contract pilots. All charter operators have to meet government requirements articulated in the FAA’s 14 CFR Part 135 rules, however, some have more rigorous standards.

Argus, Wyvern, and IS-BAO each provide third party safety ratings awarding different levels of achievement, however, not all include on-site audits. While they provide directional insight, a good broker knows the reputation of the operators. From experience, a good broker stays away from operators that cancel flights at the last minute, those with high turnover or other warning signs.

Industry lore is that most people call several brokers to request quotes, with AirCharter.com we do the shopping for you to get you the lowest prices while giving you the best Aircraft with the highest safety ratings, so if you go the on-demand charter route, you will probably spend several hours not only soliciting quotes, but then reviewing the terms and conditions of each. Once you find a broker like AirCharter.com who knows what you want and is able to deliver, you’ve hit the jackpot.Friends who charter regularly are a good sounding board, as most folks who charter have had gone through a few brokers and operators before finding the ones they count on. Argus and Wyvern both certify brokers and the lists are a good starting point.

Downsides of On-Demand Charter

Downsides of on-demand charter include that each brokerage or operator prices trips differently, so you might see two brokers or a broker and operator offering the same jet for the same trip at different prices. AirCharter.com works on very small margins and are willing to share the Operator Name and Tail name using our Tail Credits Program that cost as little as $4.00 per Tail.

You may also get quotes for your trip that include empty legs. These are repositioning flights to get an aircraft where it needs to be for a revenue flight or back to base. If the person paying for the full-priced flight changes plans, your empty leg can be canceled on short notice. If you see prices that are markedly lower than most quotes, make sure to ask if they are these ferry flights. With limited airline options, or if you are flying from an airport without airline service, you’ve been warned.

That brings me to the other consideration with on-demand charter. For the most part, if your flight is canceled because of a mechanical or the pilot is sick or can’t get there, you are on your own so to speak.While the operator or broker will likely help you find a replacement, you are responsible for any extra cost unless it is otherwise stipulated. It may meaning paying the new provider while waiting for a refund from the one that couldn’t provide service. Wiring $30,000 on the spot might not be easy.

Additional services such as catering and deicing is a la carte. There may also be extra charges for using WiFi. Not all aircraft accept pets and some have restrictions on oversize luggage, so make sure you provide the broker or operator with all relevant information at the time of booking. Don’t just show up and assume you it won’t be a problem to bring along your eight French Poodles.

Key Players

AirCharter.com has invented the first booking engine for the Private Jets In A World With COVID-19 industry back in 2000 and has been at this since 1993. There are more than a thousand and 573 Argus Part 135 charter operators in the U.S. with at least one business jet available for charter, although some work mainly through brokers. Over 70% have five or fewer jets in their fleet. While some or the larger players have floating fleets, an operator at your local airport might make sense, so size doesn’t necessarily matter, particularly if you do a lot of same-day returns. AirCharter.com has over 1933 Operators Worldwide that we work with and over 13,400 aircraft in our database to best serve our customers.

Unlike AirCharter.com that invested over $50 Million in our booking and Charter Management, Air charter brokers aren’t regulated or licensed. All you need is a laptop, WiFi connection, slick website, and subscription to some of the databases that show availability of aircraft from various operators. Before you buy, make sure you know who the owner is. Google to see if there is a history of complaints or lawsuits. Whereas with AirCharter.com you can see the operator name and aircraft tail number before requesting your trip.

Jet Cards and Private Jet Memberships

Jet cards and private jet memberships are a form of charter, so you have the same choice between operators and brokers. In fact, some programs are a mix, and during peak periods, many operator programs go off-fleet to meet extra demand. The good news is you will typically get an upgrade to a larger jet to soften the blow.

Many jet cards give you benefits of full or fractional ownership, namely guaranteed access, fixed pricing, and consistent standards of aircraft, sans the long-term commitment.

You can buy blocks of time starting at $25,000 or 10 hours of flight time. If you need more, you buy more. If you don’t, you’re not stuck with a bunch of expensive metal.

Typical jet cards users spend $75,000 to $500,000 per year on fights. However, some companies spend millions. They either don’t want to have jet ownership listed in their public financial reports or simply want an easy out if their needs change suddenly.

Jet cards and private jet memberships have changed quite a bit, so today’s programs have more variables, meaning you really need to do your homework before choosing.

Some use dynamic pricing, so similar to on-demand charter, except they typically offer service recovery guarantees, sourcing standards and other perks.

Six-figure deposits are no longer a necessity. Pay-as-you-go programs charge you an annual membership, then you are billed on a flight-by-flight basis. You can even use a credit card on file so you don’t have to worry about transferring funds for each trip. Don’t forget to amortize the cost of the membership across your anticipated flight hours to understand your true cost.

I believe the two strongest benefits of card programs are the combination of guaranteed availability and fixed one-way rates.

Guaranteed availability means that if you book outside the deadline, typically between eight and 48 hours on non-peak days, you are guaranteed an aircraft.

Combining it with fixed one-way rates means you know how much you will pay in advance, and your hourly charge is based only on the flight hours where you are onboard. You don’t pay for the empty repositioning flights.

Many programs offer efficiency discounts for qualifying roundtrips, typically two billable flight hours per day. For example, if you made a three hour flight from your base to somewhere on Friday and came home Sunday, your six flight hours of flying time divided over the three days you were away would earn you the discount. Roundtrip discounts from the more than 250 programs I’ve analyzed range from zero to 40%. In other words, the fine print can save – or cost you tens of thousands of dollars.

Other perks of card programs can include being able to upgrade or downgrade size of the aircraft based on need, again at fixed rates with guaranteed availability, or having multiple aircraft at the same time. In other words, for $100,000, you can have your own flight department on call. In fact, many aircraft owners use jet cards when their birds are in the shop or if they need a different type for specific missions.

Unlike on-demand charter, jet cards usually have service recovery guarantees. You won’t have to pay extra for replacement aircraft, and you might even get credits based on length of delay. Since they vary, another reason the fine print matters.

Once you find the right program and know the rules and policies – something you should spend the time to compare before you buy – you can book in seconds, often online, by calling, or even text message.

Some card programs include deicing, gourmet catering or catering credits, free WiFi and other perks like discounts and special offers with luxury partners.

Downsides of Jet Cards and Memberships

Depending on where and when you are flying, you might beat your program rates with on-demand charter. Then again, when you buy a jet card, you aren’t getting married. If there are trips you feel you can do better from the open market, there’s nothing stopping you from getting broker quotes, and then choosing the best option for that journey.

Most programs have peak days, and often it’s like two separate programs. Lead time for bookings can stretch to 14 days in advance, and in some cases you can’t cancel without penalty after you make your reservation. Surcharges can range up to 40%, and I’ve seen cards with over 100 peak days per year. At the same time, there are others that don’t have surcharges or even peak days, and where booking windows are only 48 hours.

Just like airlines, private aviation companies – brokers and operators – go bust. Take the time to figure out who is behind that website. Treasury Secretary Steven Mnuchin is still trying recover $200,000 from a company that closed down. I recommend if you have any questions, use programs that offer escrow accounts.

Full Aircraft Ownership

As big wealth is achieved at a younger age, there has been an influx of first time owners. In other words, today’s new private jet owner might have been sleeping on a couch in their dorm less than a decade ago.

While you can enter into charter and jet card contracts using your own lawyer, when it comes to fractional and full ownership, it is strongly advised to have professional advice. As good as your corporate counsel is, he or she probably isn’t an expert on the minutia of business aviation law.

One of the first questions is to think about new versus used. You will also want to interview management companies, unless you plan to set up your own flight department.

Instead of being repetitive here, I suggest reading “40 Steps You Need To Know Before Buying A Private Jet.”

There are many advantages to owning your own jet. You fly under the less restrictive Part 91 rules. That means access to more airports which meet OEM specifications, but fractional and charter operators won’t serve. You also can design the interior to suit your tastes, including seating layouts. You can smoke a cigar or let your pet ferrets roam freely in the cabin.

When you own an aircraft, get ready for all sorts of bills. Most owners also buy jet cards or charter when their planes are down for maintenance. And, if your needs change, you might find your current aircraft no longer is a fit. On the other side, are possible tax benefits. You can also offer your jet for charter when you are not using it to reduce overall expenses.

IADA, the International Aircraft Dealers Association, includes just 3% of dealers that collectively account for 60% of all pre-owned transactions globally. Each must go through an accreditation process every three years.

Closing Thoughts

If you can afford to buy a jet, or even drop 20,000 bucks on a charter, you are smart enough to have figured out how to earn more money than most people. The biggest mistake newbies make is not dedicating the time up front to figure out the solutions that are best for them. The other mistake is not engaging professionals to assist them. AirCharter.com has invented the first booking engine for the Private Jets In A World With COVID-19 industry back in 2000 and has been at this since 1993.

One thing I can assure you is once you start flying privately, you’ll understand its value and wonder why you waited so long. I like to say, flying privately won’t add years to your life, but it will add years of enjoyment to your life.

By Forbes Doug Gollan

 

 

 

 

By |May 20th, 2020|Categories: Aircharter News|0 Comments

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