EJM to offer scheduled service on business jets

 - January 30, 2007, 5:32 AM

Indigo tried it and failed. Now Executive Jet Management (EJM), a NetJets company, is hoping to succeed in offering a scheduled air service using a fleet of business aircraft.

Executive Jet Management last month filed an application with the DOT that would allow the Cincinnati-based charter and aircraft management specialist to provide scheduled air service connecting the Chicago, Los Angeles and New York metropolitan areas under Part 380 of DOT regulations, with EJM as “the direct air carrier.” According to the application, Executive Jet Management has been involved in discussions with two outside companies, one of which will likely serve as the “public charter operator.”

While EJM did not reveal a launch date for service, an income statement showed anticipated revenue for the operation beginning in November this year. The statement further suggested minimal start-up costs (an extensive infrastructure is already in place) and an early realization of profit.

Not a New Concept
The concept is similar, but not identical, to that of Indigo, a failed Chicago-based air service that operated from 2000 to 2003 as a “public charter operator” under Part 380 of DOT regulations, authorized to do business as an “indirect air carrier.” Part 380 allowed Indigo to deal with the public and sell seats, initially on two Falcon 20s and later on an Embraer Legacy Shuttle. A sister company, Air-Serve, held a Part 135 certificate that allowed it to “physically and directly” operate the aircraft on Indigo’s behalf.

The company began what it called “regular and frequent” business aircraft service between Chicago Midway Airport and New Jersey Teterboro Airport with a Falcon 20 in February 2000.

Struggling to remain solvent, Indigo ceased operations briefly in 2002 and relaunched operations in March 2003 with the 16-passenger Embraer Legacy Shuttle. Three months later, Indigo closed down again and has remained closed.

Unlike Indigo, EJM expects to operate as a scheduled service and will use aircraft from its fleet of 79 business jets. The current aircraft management and charter structure would remain in place and support again and has remained closed.

While the fleet ranges from aircraft as small as a six-passenger CitationJet to an 18-passenger Gulfstream IV, the presentation to the DOT said, “It is anticipated that EJM will support its commuter service with [63] aircraft configured for 10 seats or less.”

EJM anticipates there will be approximately 30 round-trip flights a week between Westchester County Airport in White Plains, N.Y., and Chicago Midway Airport, and approximately 10 round-trip flights a week between Westchester County Airport and a yet-to-be-identified airport in the Los Angeles metropolitan area. And, the company added, “As business conditions allow, EJM plans to expand public charter operations in other markets.”

The presentation to the DOT included a “certificate of service” notification that included Aspen/ Pitkin County Airport in Aspen, Colo., Palm Beach International Airport in West Palm Beach, Fla., and Lunken Airport in Cincinnati. EJM declined to comment on the application or to reveal additional details of its plans for the service.
While there was no mention in the application of a fare structure, it is worth noting that Indigo was offering a one-way fare of $749 between Chicago and Teterboro. The fare was comparable to the cost of a walk-up, one-way ticket on a scheduled carrier but considerably less than that of a first-class ticket, which was then priced at slightly more than $1,000.

Pending FAA regulations could require some changes to commuter operations that might affect EJM’s plans. An Aviation Rulemaking Committee of the FAA recently concluded its investigation of the DOT’s Part 380 requirements and is expected to recommend changes that include a limit to the number of weekly round trips if the operator is using aircraft with 10 or more seats. While that would not affect EJM’s initial plans to operate with aircraft carrying fewer than 10 seats, it might place a limit on future expansion.

Executive Jet Management focuses on charter service and aircraft management that includes revenue-producing charter management.