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.
Canadian aircraft management company Air Partners has launched a fractional-share program to capitalize on historically low used aircraft prices. Air Partners is headquartered in Calgary and is a subsidiary of Morgan Air Services, which was founded by WestJet Airlines cofounder Tim Morgan in 1983. In addition to aircraft management, Air Partners offers charter and aircraft maintenance services.
The sudden collapse in August of fractional ownership startup Jet Republic probably convinced anyone in Europe who still failed to accept that business aviation’s bubble had burst.
By November 2008, it was obvious that despite the best efforts of the drivers and most ardent wishes of the passengers, the economic bus was headed over the cliff.
Since Sentient Jet was purchased by Macquarie Global Opportunities Partners last September, the company has returned to its roots, according to CEO Steven Hankin. Business is down, he concedes, but the slumping economy has forced business travelers to avoid owning capital assets–and therefore moved them toward purchasing jet cards.
Fractional ownership of private aircraft seems to be a struggling business model in North America and Europe but it’s alive and well in this part of the world, according to NetJets Middle East (NJME). The company, which is owned by Saudi Arabia’s National Air Service and is affiliated to U.S.-based NetJets Inc.
New NetJets chairman and interim CEO David Sokol has begun making changes at NetJets Europe, appointing a new boss to run the business and implement job cuts at its headquarters. Eric Connor has been appointed the new CEO and chairman of NetJets Europe following the October 4 resignation of CEO William Kelly “to pursue his own interests.”
Flexjet, Bombardier Aerospace’s fractional-share program, announced a reconfigured product offering at NBAA, with an emphasis on its ability to offer supplemental lift and other aviation solutions to corporate flight departments.
The fractional share marketplace is changing rapidly in response to the lengthy global recession. While most fractional operators already reduced staffing levels to match lower levels of customer activity, it wasn’t until September 11 that NetJets announced layoffs of 350 nonunion employees.