Will private jets run out for vacation?


You can’t get a new car – or at least the one you want. Your new sofa is out of stock. It could be delivered in January. Is the shortage of private jets the next step?

Sentient Jet, which invented the jet card, and Jet Linx Aviation, the sixth-largest charter operator in the United States, stopped selling jet cards to new members late last week. The announcements, which came 24 hours apart, followed similar actions in August from market leader NetJets and its aircraft management arm, Executive Jet Management.

The reasons are both complex and simple. The simple answer is that the business is too good. In the past four weeks, private flights in the United States have increased 14% from pre-Covid levels in 2019, according to WingX. In Florida, there were 41% more private flights than two years ago. Argus TraqPak predicts record flight levels through the end of the year.

As demand for private flights has reached unprecedented levels, jet card programs and memberships offering fixed or capped fares with guaranteed short booking windows are under pressure to find these flights cost-effectively.

As prices for on-demand charter flights have skyrocketed in recent months, private travelers who had booked one-way flights have turned to jet cards, seeking to lock in both what they will pay and what they pay. ‘make sure they can get a plane when they call.

By announcing a pause in taking on new customers, all service providers spoke of their desire to take care of existing customers as a priority.

Customers who buy jet cards, typically prepaying $ 50,000 to $ 500,000, typically have flights in mind they want to take when they wire the money, executives say.

As existing members adjust to their individual travel habits, an influx of new customers leading up to the peak vacation travel season is scaring executives who have to contractually pay for these flights.

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Executives say more than 90% of new customers book a flight within 30 days of joining. The agreements, which often span dozens of pages, allow customers to call and book flights with 10 to 24 hours notice.

From August to September, many jet card vendors have extended this reservation window. Indeed, the average booking window has increased by almost 50%, from 29 to 44 hours, for the more than 250 jet card programs that I follow on my website, Private jet card comparisons.

As a general rule, there is no advantage between on-demand charters and fixed-rate jet card fares. The main benefits of the cards are saving time – you don’t have to shop from multiple brokers, compare quotes, review terms and contracts for each trip – and you get guaranteed replacement flights. free of charge if the operator cannot make your trip. Some card programs also include defrost, WiFi and restore.

However, looking at 30 scenarios last month, jet cards were cheaper in 25 cases, beating on-demand prices on average by $ 5,693 per segment. This is despite the jet card programs that increase rates by 2% month over month.

Now, as the industry grapples with supply chain issues impacting how quickly planes can be repaired, fuel shortages and air traffic control slowdowns, executives to whom j ‘ve talked about considering ways to get guests to book in advance or even stay at home.

A CEO said his company has called customers, offering them a 10% discount to book their Thanksgiving and Christmas flights by next week. Another told me he was considering offering bonus flight credits to members who agree not to fly between November 15 and possibly during the Super Bowl, usually the busiest weekend for travel. by private jet.

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Broker says there are good reasons to be concerned. Earlier this week, he struggled to find a jet in the busy East Coast corridor for a customer who late booked a flight from New York to North Carolina.

Kevin Diemar, CEO of Miami-based Unity Jets, a mid-size brokerage, says he’s glad he never added a fixed-price jet card product. While he recognizes that market prices are high and the inventory of available aircraft is low, he says, “I prefer to be in a position where I can give customers my best deal. If they can get better prices with a jet card, I’m happy to let someone else find out how they can make money on these flights.

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Despite the breaks, there are still over 50 vendors selling jet cards in the United States and the big guys who have stopped selling still have thousands of customers who are likely to fly during the holidays.

A company that stopped selling jet cards in August, Jets.com, a mid-size broker, recently relaunched its program with longer booking times and higher rates. Magellan Jets, another midsize broker, just added a new card for light jets and Private Jet Services, specializing in sports team charters, added a new flat rate card on ultra-long haul jets. .

What is certain is that none of the new aviators who have flocked to private aviation due to Covid’s intention to return to airlines. “Never, never, never,” said a new private flyer when I asked this question after he finished complaining about the recent delays. His end result, “Flying in private is always much, much better. I could change providers, but I’m done with the airlines.

In a business where most customers join programs based on referrals from existing customers, vendors may wonder how the booming business has created so many headaches. How they’ll keep customers satisfied – and loyal – in the months to come may be their biggest challenge.

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