Terry Spruce began as a freelance aviation journalist in 2005, after working for a well known... Read More
Private Jet Charter
Following the Air Charter Expo at London Biggin Hill, Terry Spruce discussed the private aircraft charter market with Oliver Kingston (OK) of Cork, Ireland-based Kingston Aviation and Adam Twidell (AT) of PrivateFly to gain a clearer reflection on the health of that industry…
TS: There seems to be some difference in opinion as to whether there’s currently growth in the charter market. What can you tell us?
OK: I believe the private aircraft charter market is growing, albeit at a very slow pace. However, I feel the private aviation charter industry is behind the curve in many instances in terms of helping the industry to grow and opening it up to 'the masses'.
The industry is not operating as efficiently as it should in this modern age, and this is primarily due to the sector still operating as an elitist business, in my opinion. Private aviation is today where commercial air travel was in the 1980s, and I believe this will need to change if we’re to see any considerable upward trend.
Having 37-40% of private aircraft flying empty at any given time is, to my mind, not sustainable if the market is to grow. This lack of efficiency would not be tolerated in any modern day industry.
AT: Certainly at PrivateFly we are seeing continued growth in the charter market, with our business continuing to show growth of more than 50% every year. But perhaps that’s because we are gaining at the cost of our competitors!
It is certainly an interesting and diversifying time in the charter market with new business models trying to get traction. Subscription models are to be welcomed as they create noise, and introduce many new customers from Business & First Class Commercial Aviation into the Business Aviation funnel.
However the charter market will be under more intense competition now with a proportion of charter customers trading down to join these 'all you can fly' models.
TS: The private aircraft charter market has many niches, but which are worth watching in particular?
OK: The niches are in the VLJ market. As I see things, VLJs are the one category of aircraft that are blowing the statistics out of the water in terms of movements. I also feel the new SETP regulation will be a game changer in terms of attracting new customers (both aircraft operators and customers) to the market.
AT: For me, there is a gap in the market between ad hoc charter and jet cards. Watch this space for new products that give customers complete flexibility backed-up by certainty of the product delivery.
TS: Will SETP make differences in Business Aviation?
OK: As mentioned, I do feel SETPs will have a major impact (although perhaps not immediately) on the European private aviation industry in particular. SETP have a lower acquisition cost, lower operating cost, and can access more airports (which also offer lower landing and handling charges) than a twin turboprop or jet.
Thus, a lower entry price point should be created, introducing more customers to the world of private aviation.
AT: Yes - SETPs are a good news story for private aviation. If we look at the single-engine charter market in the US as a reference, it clearly shows that lowering the entry point brings a significant number of new customers into the market. This creates new jobs for pilots and the wider support roles.
Single engine aircraft can also open up many more airports, so will be a welcome new revenue stream keeping many smaller airfields open.
The different niches of Business Aviation all have their ups and downs. Some in the industry believe private aircraft charter it is still in the midst of difficulty, but the general consensus from those we polled is that the industry is growing - albeit some believe the growth is slower than others.