NBAA Convention News

EJM signs up its 100th aircraft

 - June 30, 2008, 9:11 AM

Executive Jet Management, a NetJets company (part of Warren Buffett’s Berkshire Hathaway empire), celebrated another milestone at NBAA 2002 by announcing the addition of the 100th aircraft, a Gulfstream IV-SP owned by Charles Cohen of Design Professionals. EJM president and CEO Albert Pod emphasized, however, that this isn’t the end of its charter fleet expansion–by a long shot. Since January, EJM has added 20 aircraft to its ranks and expects to add 25 more before year-end. A prime goal for 2003, Pod noted, is to add fleet locations to new sites around the U.S. to provide more aircraft options to its customers.

Cohen’s Gulfstream is being refitted at Gulfstream Aerospace’s Appleton, Wis. facility, and its engines will undergo a routine midlife inspection. It will be based in the New York metropolitan area and will be available for charter use from EJM this fall. Nerve center for EJM’s operations–turnkey aircraft management, charter aircraft management, on-demand charter and corporate shuttles, and aviation consulting services ranging from maintenance and flight operations to training–remains at Cincinnati’s Lunken Airport where it began occupying new facilities a year ago. The center’s hangar space is large enough to house 20 aircraft and all sizes of business aircraft through the Gulfstream V.

By the end of this year, Pod predicted, the company will have handled more than 19,300 total flight segments amounting to 4,920 charter segments that include 726 international flights. EJM estimated it will handle almost 14,500 owner flight segments over the same period.

Those owner segments can be quite lucrative for owners and operators of underutilized business aircraft. Ginnell Schiller, v-p of marketing, pointed out that chartering such an aircraft for 250 hours per year, which is only about four hours per week, can bring in revenues of about $225,000. Schiller said that number is based on gross charter revenue of $2,200/hr, minus direct operating costs of $1,300/hr. An aircraft used for charter 400 hr/year, according to EJM, will net the owner $360,000 annually, using the same hourly charter revenue and direct operating costs.

Schiller stressed, “If your aircraft is less than fully utilized, EJM’s Charter Aircraft Management Services can leverage that downtime to improve your bottom line, while still assuring you full access to your aircraft whenever you need it most.” The key to that, Schiller said, is that EJM receives a large annual volume of requests from corporate travel schedulers, charter broker/operators and corporate flight departments. “EJM offers more charter opportunities because, frankly, we have more charter demand than anyone else.”

The response of industry people to Professional Pilot magazine’s “Preference in Aviation Services and Equipment” survey gives credence to EJM’s success. Earlier this year, EJM was named “Best Charter Service,” the fifth straight year the company earned that honor.

The endorsement of EJM’s charter expertise by Tom Edwards of Badgett Enterprises, Madison, Ky., according to Schiller, tends to be typical of comments from owners of aircraft in the program. “We have a Citation X, an $18 million aircraft, that was being used on a very limited basis. We were flying 200 hours or less a year. As an accountant, that means an asset sitting on the runway.” EJM provided the answer to the problem, he stated. “Their program is cost effective even if you are not flying a huge number of hours with them. It costs us very little to participate with them. Even if we had only 100 or 150 hours we could fly for EJM, it would certainly be economically feasible to do it.”

In fact, Edwards said, the services provided in the EJM association proved rewarding enough for his company to take greater advantage of them. “We were talking about flying 250 to 300 chartered hours a year, and part of our concern was asking, ‘Is it going to be worth what we go through to get our aircraft ready and to go through the program?’ Our answer is Yes.” As a result, Badgett expects at least to double the number of charter flight hours originally planned for the Citation X.

Schiller also called attention to EJM’s plans to increase its focus on California and the western region. “We’ve anticipated this upswing (in significant regional growth) by bringing seven new aircraft onto our charter certificate over the last year, and we’re not even close to being finished.” The program led to placing a Gulfstream IV-SP and Gulfstream Galaxy 200 in San Jose, a Citation X in Monterey, a Hawker 800 near Sacramento (McLellan) and a Hawker 800XP in Concord. “Two are currently positioned in Southern California, a Citation Encore at Van Nuys and a Citation Excel at Santa Ana Airport. Additionally, four aircraft are now based in Nevada, with one in Seattle.”

EJM also announced a number of personnel additions to its roster of regional vice presidents of sales during NBAA 2002. These include appointments of Matthew Betty, based in Arlington, Texas; Jodi Balestrieri, based in St. Augustine, Fla.; and Pamela Scharlach, based in Toluca Lake, Calif.