While global commercial aviation stumbled down the stairs headfirst in the early months of the pandemic, private aviation stood tall. It seemed to be the first choice of travel when contact with the masses was assumed to be potentially fatal. Private jets faced explosive demand for their services…and it only got better from there. According to Honeywell’s 2022 Global Business Aviation Outlook report which surveyed private jet operators, it forecasts that there will be up to 8,500 new business jet deliveries worth US$274 billion between 2023 to 2032 – that’s a healthy 15 per cent increase in both deliveries and expenditures for the same 10-year forecast made only a year ago. Next year alone, finds Honeywell, deliveries of new business jets are projected to be 17 per cent more than in 2022, with expenditures on them rising approximately 20 per cent.

While outright purchase and full private jet ownership come with its own field of problems – maintenance issues, underutilisation of the aircraft, high acquisition and fixed overhead costs, and crew retention – a model that alleviates many of those areas of concern is fractional ownership of private jets. “If you are a large multinational or an entrepreneur, you don’t really want to be paying for a full aircraft that for 70 per cent of the time is empty and sitting on the ground or in maintenance. You don’t want to take care of all the dead costs. You only want to deal with the live costs of when you’re enjoying the aircraft…and that’s basically what we allow them to do,” explains Marine Eugene, managing director for Europe at Flexjet.

The former Netjets executive who grew up in Normandy notes that the average aircraft owner doesn’t use their aircraft for more than 120 hours a year – yet for an aircraft to be fully utilised, it needs to be operated around 800 hours annually. Flexjet therefore allows a member who wants to sign up for its programme to choose the number of hours they’d require to use the aircraft each year (there’s a minimum buy-in of 50 hours) and pay a proportional share of the purchase price of the aircraft. For example, if a customer intends to fly 100 hours annually – that’s approximately 12 per cent of the 800 hours calculation – then they will need to shell out 12 per cent of the purchase price of the aircraft. “This is the purchase of an asset that’s identified, so you physically own a title of ownership on the aircraft. They also then pay a proportional fee of the fixed costs associated with the ownership of that aircraft, and will then only pay a nominal fee which covers parking, fuel and handling charges when actually using the aircraft. The usage is only calculated based on occupied flight hours when the passenger is on-board – we don’t charge for empty legs or waiting time,” says Eugene.

The Ohio-headquartered Flexjet was founded back in 1995 by Bombardier and AMR Combs (the parent company of American Airlines) and was acquired by Directional Aviation led by Kenneth Ricci in 2013. From its inception, Flexjet was always a US-focused player until around four years ago when it decided to expand into Europe. The US private aviation market for charter, fractional ownership and whole ownership is estimated at approximately US$33 billion.

“Flexjet is a very North American company. It took a while for it to come out of the US. When I met Kenneth and Michael [Silvestro, CEO of Flexjet], they said that Flexjet understands America and finds it easy to operate within that market since there is one language, no borders checks and you can easily travel between the different states and cities. However, they eventually found that their customers were not just going from Washington to New York, but to Dubai, Hong Kong and India. It was a change in the requirements of their customers which led to the introduction of aircraft such as Gulfstream G650 in the fleet. The natural step that they then considered was to expand the programme itself overseas. The next biggest market after America is Europe, the Middle East and Africa,” says Eugene. While she began to head up the European operations four years ago, Flexjet now has plans to expand into the Middle East as well. Last month, Business Traveller Middle East was invited on-board a Flexjet Gulfstream G650ER flight that operated from Dubai to Muscat.

A Flexjet G650 aircraft
A Flexjet G650 aircraft

Wheels up
Our flight on the Gulfstream G650ER ultra-long-range aircraft (it can go nonstop between Dubai and New York or Los Angeles to Tokyo) was scheduled to take off from the Execujet terminal at Dubai International airport. As soon as I entered the terminal, a member of the Execujet staff took my passport to complete the immigration checks while I made my way to the well-appointed lounge which had artwork, books and large-screen TVs. There’s a Duty Free shop located just opposite the lounge should you wish to pick something up either pre-departure or on arrival. The overwhelming advantage of flying private is the time you take from entering the airport to boarding the aircraft. There aren’t any immigration queues to contend with or any long serpentine security clearance lines. For those crunched for time, they could – theoretically – clear immigration and security and be on their flight in under 10 minutes from the time they enter the terminal.

The G650ER we flew that day had a four-zone configuration and could seat 12. The seats could be converted into six lie-flat beds too which can be done on long-haul flights. Polished wood veneers, pillowy carpets and ultra-smooth exotic leather-covered seats were the trims we found on the aircraft. Soon it was time for take-off, and what you must know is that due to the lightweight nature of the aircraft and its powerful jet engines, you will ascend very rapidly. Fun fact: Private jets fly at approximately 40,000ft which is higher than commercial airlines. We didn’t climb to that altitude since we were only flying to Muscat which was a 40-minute flight from Dubai.

The aircraft had a crew of five – two pilots, an engineer and two flight attendants. The service included white tablecloths, Georg Jensen tea sets, crystal flutes and curated menus. Eugene explains that the crew are given company credit cards and encouraged to make purchases based on the preferences of the customers that they are flying. In 2015, Flexjet rolled out what it calls its Red Label service wherein it assigns dedicated crew and pilots to a single aircraft. It says that its average pilot new hire has over twice the minimum flight hours required for the position. Its approximately 1,000 pilots make up around a third of its roughly 3,100 employee headcount.

The large oval windows offer great views throughout the flight, but the best window to look out off is undoubtedly the cockpit if you manage to find yourself seated on the jump seat. This being a private aircraft, a passenger is allowed to occupy the jump seat during take-off and landing.

Soon, we landed in Muscat and were whisked from the tarmac in Jetex-operated Rolls-Royce and BMW cars to a private aviation passenger clearance facility. We were then driven to The Chedi Muscat which is a Flexjet partner hotel. Flexjet has partnered with select properties around the world to offer its customers deals and experiences that they couldn’t avail of otherwise. “Rather than giving a free night or a free breakfast, our goal is to provide something much more experiential. We have partnerships with The Chedi in Muscat, the Claridge’s in London, the Iniala Harbour House in Malta and The Kulm Hotel St. Moritz. The Kulm is a good example because when you stay there as a Flexjet customer, you get an all-inclusive spa experience – you can hire the private spa for the day,” notes Tom Ville, director of marketing at Flexjet.

“Our partnerships aren’t just limited to hotels and resorts. It also includes wine and vineyards – we work with the Château d’Yquem. Our clients can do exclusive tours of the vineyard which aren’t otherwise open to the public. We even have an events division where we do bespoke events such as private tennis clinics with famous tennis players, or a wine-tasting event in Bordeaux, or something at the Palio di Siena horse race. We’ve also done private dining at some of the world’s top Michelin Star restaurants,” adds Ville.

The interiors of the Gulfstream G650
The interiors of the Gulfstream G650

Charting a flight path
In October, Flexjet announced plans to list on the New York Stock Exchange. To do so, it decided to combine with billionaire and Chelsea football club owner Todd Boehly’s special purpose acquisition company, Horizon Acquisition Corporation II. Only 11 per cent of the company’s capital will be offered in the IPO. The listing is expected to take place in the second quarter of 2023, and Flexjet’s current numbers suggest that it is doing so from a position of strength.

It has projected its revenue to reach US$2.3 billion this year, a long way up from the US$1.34 billion it recorded in 2019. Its EBITDA too is forecast to have nearly tripled from US$97 million in 2019 to US$288 million in 2022. Furthermore, it expects to have over 235 jets in its fractional fleet by the end of this year. This mix of aircraft includes 49 light jets such as the Phenom 300, 44 mid-size jets including the Praetor 500, 92 super-mids which include the Challenger 300/350/3500, 32 large aircraft like the Gulfstream G450 and 18 long-range jets such as the Gulfstream G650.

“The news that we’re going public was very exciting because it’s been clearly announced that the money raised will be used to expand into Europe, the Middle East and Africa. We will benefit from fleet expansion, infrastructure [projects] and strategic acquisitions,” says Eugene.

While our flight between Dubai and Muscat was supported by third-party entities such as Execujet in Dubai and Jetex in Muscat, Eugene hints that the new capital will allow Flexjet to build its own terminals and ground infrastructure which it has already begun doing in select locations. “Where we have a lot of traffic, for example at Teterboro in New Jersey, we have built our own private jet terminals that we own and operate ourselves. In the US, we have several of them including at White Plains in New York, Dallas in Texas, and Van Nuys in California, among others. We’re opening one in Scottsdale in Arizona too, and are working on some projects in the London area. At some point, we can look at a dedicated terminal in the Middle East.”

Flexjet doesn’t have to worry too much about customer retention – it has approximately 10,000 committed contracts and says that its retention rate among long-tenured relationships stands at approximately 97 per cent. Over 35 per cent of its fractional ownership customers have been signed with the company for at least a decade.

That extensive and loyal customer base is also pushing forward an important and often controversial subject when it comes to private aviation – sustainability. “Half of the Sustainable Aviation Fuel (SAF) used in the world last year, was used by private jets. Private jet passengers with their money – SAF costs twice more than normal fuel – are helping develop the future network of SAF. If you didn’t have those customers willing to spend more for that fuel, SAF would not stand a chance,” says Eugene while defending the position of the industry in which she operates.

She adds that there are inherent problems with the use of SAF apart from its price – and that is mainly its production and availability. “SAF can reduce your carbon emissions by 80 per cent. The challenge with SAF is that it is not very widely available because the current generation of it is made from recycled frying oil, for example, and it’s not very scalable because you have to imagine going around the country collecting that oil. The future is what we call SAF 2.0. The next generation of SAF is going to be made from forestry products and agricultural waste and will be processed in the same refineries where the current SAF is being processed.

“We actually bought a company in the US called Alder Fuels which is investing in this new generation of SAF. We work with a company called 4Air which does our carbon sustainability programmes and they recommended that we compensate our current emissions at 300 per cent. We were one of the first private jet companies to implement carbon surcharges for our passengers – they don’t even have a choice, which I think is quite groundbreaking. The cost is immaterial to them, but every single flight we operate currently is carbon offset not just 100 per cent, but 300 per cent,” says Eugene.

Flexjet’s flight compass is pointing in the right direction. And for now, it’s got clear blue skies on the horizon.