Flexjet is offering voluntary separation agreements to its pilots as the company begins to phase out certain aircraft models and shift others from fractional ownership into charter. The company further is requesting approval to make a similar offer to pilots at affiliate operation Flight Options.
In a March 31 letter to pilots, Jason Weiss, Flexjet executive v-p of operations, said, “Fleet adjustments are a common practice in our industry. They are a necessary and beneficial way for an operator to update its fleet based on industry shifts, customer demand, aircraft age/productivity and a range of other factors.”
Weiss added that the fleet adjustments will help expand programs, such as Flexjet’s recently launched Red Label, which includes some of the company’s newest aircraft. But it also will mean the retirement of the Learjet 40XR and Challenger 604/605 fleets.
In addition, he said, the Nextant 400XT and Citation X will be moved out of the fractional business model into on-demand. This is a move, he said, that recognizes “the shift of some customer preferences to the on-demand business model” and will “significantly strengthen our competitive position in the marketplace.”
“Our companies have seen a significant shift in the fractional marketplace over the past year and a half,” Flexjet said in a statement to AIN. “While customer demand has historically been high in the light- and midsize-cabin segments, much of it has since shifted to on-demand flying.“
At the same time, the growth in the fractional programs has trended toward larger, longer-range aircraft. “These shifts have allowed us to be thoughtful and strategic about which aircraft types we want to offer as we build our future fleet to meet our customers’ expectations.“
As a result, the company anticipates the changes “will have a proportional impact on the size of the pilot group.” The company has not determined the actual number of pilots that will be needed once the fleet adjustments are made but acknowledges fewer pilots will be required for fractional operations.
The company has begun by offering the voluntary separation agreements. The initial offer included six months of salary and other benefits for all active pilots with an additional three months for Learjet 40XR, Challenger 604/605, Nextant 400XT and Citation X pilots. The company further is offering a total of 12 months' salary for pilots who had been recalled from furlough in the last few years.
Flexjet believes the program will take effect over the next 12 to 18 months.
The agreements are offered a little more than three month after pilots at both Flexjet and Flight Options narrowly voted in favor of representation by the International Local Brotherhood of Teamsters (IBT). The National Mediation Board in September had cleared a way for the vote through a ruling recognizing Flight Options and Flexjet as a single carrier under the parent, OneSky. The IBT more recently has asked the company to engage in negotiations for a collective bargaining agreement.