Phenom chosen for Euro charter operations

 - September 15, 2006, 5:22 AM

A Zurich-based start-up charter operator announced at EBACE last month its plans to place into “low-cost, on-demand” charter service a fleet of Embraer Phenom 100s by mid-2009, the first of two European operators to make public their programs to base their charter fleets, at least initially, on very light jets. The announcement came at a press conference hosted by Brazilian OEM Embraer, which used the event to unveil the fuselage mockups of its Phenom 100 very light and 300 light jets, first displayed publicly at last year’s NBAA Convention in Orlando.

JetBird, the charter operator, placed a firm order for 50 Phenom 100s and holds options for 50 more, with delivery planned over a five-year period starting in 2009. All 100 of these may be converted to Phenom 300s if JetBird so wishes. Total value of the order, assuming an all-Phenom 100 fleet and all options are converted, would be about $280 million. Embraer quotes the Phenom 100 list price as $2.75 million (2005 $) with FAA certification and $2.825 million with EASA certification. The Phenom 300’s price tag is $6.65 million (2005 $) with FAA certification. JetBird’s initial fleet will be registered in Switzerland.

The day after JetBird’s announcement German charter operator Cirrus Aviation said it would operate Eclipse 500s on behalf of UK-based JetSet Air, which ordered 50 of the Eclipse VLJs last November, with first deliveries due next spring. JetSet Air also announced it is negotiating with Embraer to buy up to 10 Phenom 100s for delivery by 2009.

According to Domhnal Slattery, founder and chairman of JetBird, the start-up company’s business model hinges on the Phenom jets’ low acquisition and operating costs, which will make it possible to charge less than half the rates of existing on-demand charter operators. Pricing will be on a fixed per-hour basis, with no charge for positioning of the aircraft (deadheading), and will need to be competitive with business-class fares on airlines. The company plans to encourage Web site booking by offering a discount and will also make use of a multi-hour jet card, a call center, negotiated block-hour options and charter brokers.

Embraer plans to have the four-passenger Embraer 100 in service in mid-2008 and the six-passenger 300 in service in mid-2009. Though Embraer plans to certify both models for single-pilot operations, current European regulations require two pilots. JetBird expects to begin operations with Phenom 100s in April 2009, using either Zurich or Geneva as its first operational hub. Most European business destinations are within 90 minutes of Zurich, said Slattery. He claimed that 85 percent of business aviation flights in Europe carry only one or two passengers and the flight time is 1:25 hours or less. JetBird has identified some 800 European airports it could use.

Slattery, who is also chairman and managing partner of Claret Capital, a Dublin-based private investment company, said JetBird plans to take delivery of 20 aircraft every five years and establish “mini-hubs” in several European cities.
Slattery said he understands “why start-up airlines fail and how to avoid it.” He said JetBird’s current $45 million in financing will carry it through its first three years of operation. “You need deep pockets for this business, and we have them.”