NetJets Europe has been summoned to appear at the Court of Bobigny, near Paris, on December 2, after three entities–French charter operator lobbying group Scara, French crew retirement fund CRPN and one pilot union–sued the fractional ownership company over alleged noncompliance with French labor laws. They charge that the flight crews of foreign countries working under foreign contracts are not contributing to France’s labor coffers.
As a result of aggressive cost-cutting measures, NetJets Europe expects to achieve modest operating profits this year. But the recovery in demand for its business aircraft fractional ownership, block charter and lease offerings is proving slower than anticipated, to the extent that the company now doubts whether even a return to modest market growth will be achieved next year, according to chairman and CEO Eric Connor.
Richard Santulli, founder of fractional-share company NetJets, is back in the aviation business with a new business jet and helicopter leasing company called Milestone Aviation Group. Santulli, 66, resigned from NetJets last August but said at the time that he would remain a consultant to the company for a year. Warren Buffett’s Berkshire Hathaway bought NetJets in 1998 for $725 million.
Richard Santulli announced today the launch of a new business jet and helicopter leasing company, Milestone Aviation Group, headquartered in Dublin, Ireland. Santulli in the mid-1980s founded fractional share company NetJets, which was sold in 1998 to Warren Buffett’s Berkshire Hathaway. Santulli left that company last year. He is now chairman of Milestone.
Fractional share provider Bombardier Flexjet is celebrating its 15th year in operation. “Over the past 15 years,” said Flexjet president Fred Reid, “the company has progressed immensely.” Last year, he said, “We did lose some money, a small fraction of what our competitors lost.
Executive charter operator VistaJet has ordered six more Bombardier aircraft for its planned expansion into markets in West Africa, the Middle East and Russia. The deal announced in Farnborough includes four Global Express XRS and two Challenger 605 jets that are due for delivery in 2011 and 2012. The additional aircraft will expand VistaJet’s fleet to more than 30 airplanes.
NetJets Europe has introduced a new range of recyclable packaging for in-flight catering as part of its ongoing effort to reduce the carbon footprint of its services. The fractional ownership provider now gives passengers their meals in a box made from sustainable source bamboo, along with wooden cutlery and porcelain containers–all of which can be reused. The lids are biodegradable.
Former NetJets Europe executive Chris Moody claims he has helped to bring liquidity back into the market for fractional shares in business aircraft by offering a way to buy and sell shares without incurring what he regards as the prohibitive fees associated with fractional ownership contracts.
If it is true that an event becomes history when it is no longer referred to in the present tense, then the Great Recession still has some receding to do, despite recent suggestions by industry analysts that we are now in the market trough and the only direction is up.
Data on the U.S. fractional share industry show that last year was extremely challenging for the big four fractional operators–NetJets, Flexjet, Flight Options and CitationAir–and for smaller but healthier Avantair.