Private jets are targeting the corporate market – could there be a business argument for using one? Tom Otley reports
Imagine an aircraft waiting for you, rather than you waiting for it.
It’s at the airfield nearest to your work or home, and it will fly to the landing strip closest to your destination. If you’re late, it will wait, and if you’re early, there’s a good chance it can set off ahead of schedule.
Departure formalities are swift. There’s no restriction on bags or liquids, and if you have a drink of choice that you like to sip while taxiing to the runway, it will have been prepared if you’ve pre-specified – if not, simply pour whatever you brought with you.
Private jets are for the privileged few. While millions crowd through airports every day to take both short- and long-haul flights, only a few thousand people will be experiencing corporate jets.
For most of us, aviation has improved in recent years, with a greater choice of airlines, routes and new-generation aircraft such as the A350, B787 and A380.
Marketing efforts have focused on bringing the thrill of flying back to a process that has become rather too pedestrian for an activity that takes place above 30,000 feet. Higher ceilings, mood lighting, quieter cabins, larger windows and more favourable pressurisation have enhanced the experience.
But ask anyone who has been on a business jet and they’ll tell you: nothing beats your own plane.
In corporate jet terms, the Cessna Citation Latitude, made by Textron Aviation, is a midsize aircraft capable of seating nine passengers (although six would be a more comfortable number when opening champagne).
Its modern design allows for the floor to be flat rather than having a sunken corridor, with a cabin six feet in height and 77 inches across. There are large, evenly-spaced windows that give great views, and it’s quiet both inside and out, considering the size of the aircraft and the speeds it attains (826 km/ph).
So what’s it like to fly on a corporate jet? The main difference from a propeller aircraft is the acceleration, which is nothing short of astonishing. Compared with the lumbering of larger aircraft, a private jet is like being in a slingshot. There’s a purity of purpose in the seconds from where flight seems inevitable to the ground suddenly vanishing beneath you.
This was only a short, 45-minute flight around Biggin Hill in South London, at an altitude much lower than the Citation Latitude is capable of (maximum operating altitude of 45,000 feet). Private jets climb quickly to reach high altitudes, where the air is thinner and they can reach their optimum speed – commercial jets typically stick at 39,000 feet.
The first time I flew on one – a Vistajet Bombardier Challenger 605 – was from Luton airport to the Monaco Yacht Show. We left behind the private jet terminal of an overcast Luton mid-morning and, a little over an hour later, were flying along the Côte d’Azur, spotting first Cannes and Antibes before landing at Nice.
The only difficulty in making our lunch appointment on board the private yacht was the traffic entering Monaco. But, then, isn’t that the sort of problem every multimillionaire faces?
COUNTING THE COST
For all this glamour, it’s almost reassuring to hear about the rather workaday problems the private jet industry has faced over the past few decades. Despite all the talk of the “1 per cent” unaffected by economic woes, private jet sales were down, with an oversupply by 2011.
Fewer individuals, syndicates and companies were buying them, and if they did have some, they were finding them difficult to sell, and difficult to recoup the running costs by chartering them out, since demand for this had also dropped.
Now, the market is starting to recover. Oliver King, managing director at Avinode, which provides the technology for brokers and owners to charter their private aircraft, says: “At best, it’s been flat this year. Flown activity has not grown, but capacity has been taken out of the market and a number of operators have exited and consolidated.”
In tough times, it’s not just who is buying jets, but also how much they cost to run once you have one. One answer is to have other people charter it to make back some of the cost, which means turning it over to a managing agent and allowing them to deal with brokers.
How much does it cost to charter a jet? A new corporate jet such as the Citation costs roughly US$1,750 per hour or US$4.45 per nautical mile to fly (excluding all the fixed costs), but on average, it is much less.
“Private jets are at the semi-top end of aviation,” says Alex Berry, group marketing and sales director at broker Chapman Freeborn. “The Citation Latitude is what we call a super mid-size aircraft; in car terms, it’s a S500 Mercedes-Benz. In reality, there are thousands of flights every day in twin turboprop aeroplanes, and you could rent a commercial aircraft for £600 or £700 per hour for two or three seats with a range of a couple of hours.”
Still, if the aim of the industry is to persuade us to move out of business class and on to private jets, it must try to achieve efficiency in its processes so it can charge a lower rate. The owner covers most of the fixed costs, so there’s the possibility of a flight being keenly priced, but “some 55 per cent of bookings are one-way flights”, King points out.
“That’s a problem for the industry. There are 3,500 empty legs in the system at any one time in Europe.”
If you don’t mind losing the flexibility of a private jet, but still want the convenience – or simply the experience – of flying one, most brokers offer empty legs.
For instance, Victor, a company that calls itself “a new benchmark in private jet charter”, advises that “by booking wisely you could save up to 75 per cent of the cost of a conventional private jet charter” – it has a list of empty legs at flyvictor.com/flights.
Others argue that empty legs aren’t as practical as they may seem: “There’s a whole misconception around empty legs,” Berry says. “While an owner might prefer an empty leg to be used, it’s not often practical since there are fundamental inefficiencies built into the process. A private charter means you go where you want, when you want.
“So if you want to delay three hours, that means the person who’s bought the empty leg at the other end has to accept there’s a caveat that it might not happen.”
In addition, while the industry wants to be efficient, it doesn’t want to “erode price expectations”, in the words of King. Some think it’s the wrong way to attract customers.
“Business aviation gives you the one thing that no one else can: the opportunity to exchange an infinite resource – money – which you can always go out and earn more of, for a finite resource – your time, which you’ll never get more of,” says Berry.
“This is the point [that needs to be made], instead of telling the story that everyone can fly private. They can’t. You need a certain level of income. It isn’t as high as people would imagine, but there is that level and the industry needs to make that clear.”
It would also help a sector used to dealing with last-minute requests. Most bookings are made at short notice – six to 72 hours before departure, on average, with 16 per cent being made in the last 24 hours, which is another challenge for any industry participant hoping to match supply with demand.
Some of this is because of emergencies (see panel, previous page) or to evacuate staff in destinations that have suddenly become unstable.
Generally, the industry prefers early bookings and preserving the value and cachet of what it is selling. Like five-star hotels, operators fashion their jets as “tools for business”, maximising efficiency for busy executives.
However, there’s also a big leisure market. In fact, July is the busiest month in Europe because of people going on holiday.
Avinode provides a distribution platform for European operators to upload their inventories and for brokers to see what’s available. In the London market, the provider of the aircraft could just as easily be Dutch or Danish flying in to help meet demand.
Avinode has 1,050 aircraft registered on its database, of which it estimates 80 per cent are available for charter.
JOINING THE CLUB
So how do you go about looking into arranging a corporate jet? The brokers are a good place to start – Air Charter Service, Air Partner, and Chapman and Freeborn are three of the largest, although there is more choice each year (see below).
Many will also offer some form of prepay card – worth considering if you need a jet in a hurry, since it saves a lot of paperwork and is refundable if you don’t end up using the full amount of credit.
Unfortunately, booking a private jet is unlikely ever to be as easy as simply clicking a button, since it’s a complicated process, but it is being made simpler by technology. Almost all of these brokers offer apps that allow you to do everything from search for a jet to see which one you have booked and even check the pilot’s CV.
Your end-to-end experience will also differ depending on where you fly from. Some aerodromes are basic, while TAG Farnborough, for example, takes great pride in its new facilities, which opened in December.
If you are taking a private jet, consider the journey from door to door. This was something I neglected to think about after my flight on the Citation Latitude and so, ten minutes after landing, I was at a bus stop outside the airfield waiting for the number 246 to Bromley South station.
Funnily enough, that wasn’t one of the pictures I put up on social media that day.
WHATEVER THE WEATHER
Even in the UK, private jet operators can win if weather conditions turn bad.
“There is a noticeable increase in enquiries for routes into UK airports when adverse weather causes delays and cancellations,” says Adam Twidell, chief executive of Private Fly. “Many are from passengers who don’t usually use private aviation and who are looking to make alternative flight arrangements at very short notice.”
He adds: “The flexibility of private jet charter is a huge advantage in bad weather. [Its] flight plan allows for last-minute changes, finding gaps in the fog and re-routing the flight accordingly, sometimes even en route.”
In recent foggy conditions across the UK and Northern Europe, Private Fly arranged for the return of 35 business travellers from a London corporate finance firm back from Amsterdam. The group was trying to return to the UK for an important meeting in Oxfordshire on the Monday afternoon.
“The aircraft took off, heading for London Oxford airport, which we knew would possibly reopen during the flight,” Twidell says. “In the end, visibility there was still too poor, so the aircraft diverted [and landed] at Exeter instead, which was less affected by the weather. We had arranged for cars to be waiting at the airport so they could still make the meeting on time. This type of agility is just not possible for airline flights.”
He adds: “Airline disruption is an opportunity for the private aviation industry to showcase our flexibility and speed of response to a new audience. The cost can also be more affordable than many people expect, especially for groups travelling together.
“For the Amsterdam to Exeter flight, we flew them in a private 50-seater Embraer EMB-145 regional airliner, which cost £11,145 in total – less than £320 per person for the group of 35.”
- Air Charter Service aircharterservice.com
- Air Partner airpartner.com
- Avinode avinode.com
- Chapman and Freeborn chapman-freeborn.com
- Execujet execujet.com
- Jet Smarter jetsmarter.com
- London Executive Aviation flylea.com
- Luxaviation luxaviation.com
- Private Fly privatefly.com
- Stratajet stratajet.com
- Victor flyvictor.com
- TAG Farnborough airport tagfarnborough.com
- Textron Aviation txtav.com