Private aviation may have survived the worst recession in decades, but where does it go from here? In part 1 Tom Otley reports on the situation in the UK and Europe

Spotting what is different about Farnborough airport can take a while. The architecture is arresting – swooping futuristic buildings, a lounge of clear curved lines and black leather, and floor-to-ceiling windows that shift your gaze to the sky.

But what really makes it different is that chances are you’ll be the only one there. This is flying without the crush. No fight for the bacon sandwiches before an early morning take-off, and no hassle at security. People come and go but most of them don’t even walk through the lounge – they are driven straight out to the aircraft.

For most of us, the thought of private jets must seem a dream. Short-haul business class has disappeared from some carriers (Bmi) and is under severe pressure in others, while the low-cost carriers continue to expand across Europe. Against such a background and the continuing economic gloom, what hope is there for private aviation?

Well, they might not talk about it, but as well as high-flying (and high earning) entrepreneurs, a significant proportion of chief executives have used private jets. Aircraft broker Privatefly ( commissioned a survey of UK CEOs and leaders of companies with an annual turnover of more than £100 million (US$154 million). It found that almost one in five had travelled by private jet. Their reasons? More than half said it was to save time and improve business efficiency, while 45 per cent chose it for travelling with important clients.

The average private return flight in Europe saves 5.5 hours on a scheduled airline trip. It’s an obvious saving if you fly to a local airport – private aviation in Europe uses ten times the number of airports than scheduled airlines (3,000 versus 300) – but it also applies to the bigger hubs. Marine Eugene, executive vice-president sales for Netjets Europe (, says most of its business comes from people flying from one financial centre to another.

“Much of the UK’s GDP comes from trading with European partners,” she says. “Yet on those routes, the traditional airports have seen services reduced, so it’s more problematic to fly to Luxembourg or Milan, both in terms of scheduling and product. Consequently, our clients do fly into small airports, but most are flying between cities such as London, Paris, Zürich and Geneva.”

Eugene is quick to point out that since Netjets is such a large operator – “Every ten or 15 minutes a Netjets plane is taking off, and 80 per cent of the flight activity of 70,000 movements is done by the large multinationals” – it gets preferential treatment on landing slots at airports as well. She says its clients are business people who want the transport to fit in with their plans, rather than trying to plan their meetings to fit in with the transport.

It’s easy to find ways to justify spending money – especially if you are the one signing off the expenses. But has the recession driven down prices, and are alternatives to buying, having fractional ownership or chartering a jet appearing?

First, a word about the business. As well as the 3,000 airports across Europe that private jets can fly into, there are thousands of aircraft available for charter. These planes will, in many cases, have been bought by wealthy individuals or companies that have handed the management of them to operators – usually, ones based in the same country as the aircraft, and probably at the airfield they are parked. As such, there are hundreds of operators, most with fewer than half a dozen aircraft.

If you want to book one, you would typically ring a broker, give your requirements, and they would find the right plane at the right price and charter it for you. But the market is highly fragmented. Privatefly estimates a broker might deal with up to 2,500 aircraft in Europe, managed by as many as 900 different operators.

Ask one of the larger brokers, such as Hunt and Palmer ( or Air Partner (, what their point of difference is, and they will say it comes down to customer service, wealth of experience, and good relationships with the top operators, which probably have more, and newer, aircraft under their management. (Air Partner also points out its royal seal as being a selling point.)

New entrants to the market, however, point to flaws in the business model. Thomas Flohr, chief executive of operator Vistajet
(, says: “All of these aircraft are subject to owner availability. What happens when the owner’s plans change and they need the aircraft they’d previously told the operator to charter out? The broker might be able to find another plane for the client, but it won’t be the one they asked for. So the client’s upset, the aircraft owner is hassled, and the broker is spending a lot of time and perhaps money to make things right.”

Flohr also points out that the focus on price erodes some of the benefits of private jet charter. “When you have the client haggling over the price, and they settle on one that’s in between [what they and the hirer] wanted, the only way for the broker to keep their margin is by flying [the hirer] the cheapest way possible.”

By and large, brokers would agree with this, which is why they like pre-selling blocks of hours (known as “jet cards”). It not only gives the charterer some peace of mind over costs, but also allows brokers to direct the business to the top operators and give some added benefits to the clients, such as flexibility over the booking (no penalty fees for cancellations of more than 24 hours’ notice being one advantage).

How does operator and owner Netjets solve some of the inefficiencies? By offering fractional ownership of its aircraft, it has built up a very large fleet, which helps with guaranteed availability. It also sells jet cards allowing individuals and corporates to fly on its fleet. “The cards are a good way of trying the service,” says Eugene, “and once people try the service, they then move up to fractional ownership of an aircraft.”

For Flohr, Vistajet’s model improves on this. “What use is it owning a fraction of an asset?” he says. “We offer our clients the chance to buy aircraft if they want to, but they do the sums and [often end up saying], ‘No, you’re right, you own it and we’ll just join the programme.’”

Vistajet’s programme of buying a minimum number of hours each year guarantees availability (with a minimum of 24 hours’ notice) on the rapidly expanding fleet of aircraft it owns. “People want to know what they are getting,” Flohr says, so the interior design of the planes is identical. Each also has a flight attendant, and the fleet is increasingly capable of undertaking mid- to long-haul sectors, differentiating Vistajet from its competitors.

As the launch customer for Bombardier’s long-haul Global 8000 aircraft in 2017, Flohr also, presumably, gets a good price. If you want to fly for fewer than 50 hours a year then you can phone up directly (or go through a broker). If you expect to travel more than that, you join the Vistajet programme.

“First and foremost, it offers guaranteed availability on my fleet, with 24 hours’ notice. I can do that because of the number of clients I take per aircraft. The fractional operators are selling 25-hour cards. I say, for below 50 hours [flying time] don’t bother with a contract, just call me and hopefully I will have a plane. The average client has 100 hours’ flying time per year, so six customers [equates to] 600 hours per aircraft.”

For the brokers, private jet travel for business used to be supported by financial services companies undertaking roadshows around Europe. “It hasn’t disappeared, but there’s much less of it,” says Simon Wheatley, UK sales manager for Air Partner. “We’re still talking with the people in charge of logistics at the banks, but now they are having the nightmare of trying to make those roadshows work with scheduled airlines. Only when they can’t do that do they come and talk to us.”

Instead, Wheatley says Air Partner has sold 85 per cent more jet cards this year than last. “Cancellation fees can be relatively significant, but with the card there are no fees until 24 hours before flying. We can also steer the business towards a more select group of operators.”

Jamie Martin, business development director at Hunt and Palmer, says that good brokers can save a client money just from finding out what they are trying to achieve. “Most clients state their requirements in the wrong form,” he says. “Maybe they want to fly to Nice but when you talk to them, they are going to Cannes, which has its own airport. So it’s a financial saving and also a return on that investment in service terms.”

A word about “empty legs”. Some 40 per cent of the time, aircraft are flying without passengers to get back into position for their next flight. It’s the same as booking a taxi to take you to Heathrow – you are paying for the return journey as well, even if the taxi then goes off somewhere else and does another job.

Most (but not all) fractional and card schemes charge only for occupied hours, so they can be a good choice for customers who fly a significant number of hours, especially for one-way flights around the extremities of Europe.

But fractional and card schemes are, on the whole, more expensive per flying hour when compared with the fluctuating prices in today’s charter market, and involve an upfront financial commitment that customers are now questioning. The recession has accelerated this “trade-down” effect, and business jet use is becoming more of a commodity. What’s more, as the charter market enters relative maturity in Europe, greater numbers of new and well-maintained aircraft are on offer.

Air Partner has introduced a free Private Jet Charter iPhone app, which allows you to calculate the estimated cost of hiring a jet based on live market data, while Privatefly’s excellent website allows you to compare thousands of prices.

Then there is Victor (, a very clever idea from entrepreneur Clive Jackson. Frustrated with scheduled airlines pulling off services he had previously relied on, he set up Victor, where membership of the club (which is free to join) allows users to either charter a jet in the normal way, with Victor acting as broker, or sell any spare seats on the jet to Victor members.

Those who just want to buy a seat can either bid on seats on the jets already booked and flying the route they want to travel, or alert the membership that there is a route on which they want to travel and, if enough people become interested, one will charter the jet knowing the others will help to offset the cost.

The traditional brokers agree it’s a clever idea, but point out that removing much of the flexibility of private jet hire – if you’ve booked a place on the jet, it isn’t going to wait for you – also removes much of the difference between private flying and scheduled flying. There’s also the problem that you can’t discuss anything confidential while in the air.

So what’s the future for private aviation? Despite economic turmoil, it might be rosy. “A lot of people are selling hard in this space,” says Hunt and Palmer’s Martin, “and the influence of the fractional ownership companies means awareness is going up. That can only be a good thing.” So prepare your arguments for the finance department, emphasise productivity, and then get ready to justify the return on investment.

Privatefly’s Charter Tips

Use the closest available aircraft
Using aircraft home bases or, better still, knowing where the aircraft themselves are located, can save on positioning costs. For example, using airports outside London such as Luton or Biggin Hill can provide significant savings.

Book in advance

Private jets are often booked at the last minute. However, when schedules allow, a week’s notice can give greater availability and more competitive pricing.

Be willing to use different aircraft types

While executive jets are perfect for continental and long-range flights, turbo-props are a great alternative for short flights. Interiors are executive-standard and often more spacious than their jet equivalent – plus, the cost savings can be considerable.

Look out for “empty legs”

If an itinerary is flexible, empty legs (where jets are flying without passengers) can provide a flight that is discounted by up to 75 per cent. Aircraft operators and brokers increasingly now publish their available empty legs online.

In part 2 of our special report on private jets, to be published in the March issue, we look at the market situation in Asia.