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Block Charter
Placing in-flight productivity and time savings at your fingertips without long-term capital or personnel commitment- with proper oversight charter is a safe- effective means for evaluating the advantages of Business Aviation- explains Gil Wolin.

Let’s assume that you’ve taken your first few charter trips- and decided that yes- business jet travel makes sense for your company for certain regular remote facility tours or customer contact- totaling as much as 100 hours of flight time per year. You will need to find out:

• Are discounts available for a commitment to fly ‘x’ number of hours annually?
• Will that commitment provide some assurance an aircraft will be available when and where you need it?

In the 60s- 70s and 80s the answer was “Yes”. There were several large fleet operators offering a sliding scale of discounts and availability guarantees based upon minimum annual flight commitments.

Reaching qualified charter prospects was challenging – and expensive – for even the most sophisticated aviation marketers. Local charter operators offered a nominal (5%) discount to secure 100-hour annual commitments- nominal because charter margins were very thin.

That began to change in the 90s- and discounts ground almost to a halt at the turn of the century. Operators no longer had to offer them as the healthy economy and the growing acceptance of business jet travel for owners as well as charterers kept them flying at near-capacity.

Additionally- charter clients had to pay to bring in another aircraft from another airport to fly their trips when the local fleet was booked- negating any block time discount. Aircraft availability and guaranteed pricing for the non-owner became unique selling propositions- thanks in no small measure to the marketing efforts of fractional operators who guaranteed aircraft anywhere with minimal advance notice.

As most executive travel is round-trip- returning home within a few days- until then the 800-plus turbine aircraft charter operators with a high volume of business had competed primarily with the few other operators in their metropolitan areas. Now- thanks to the internet- they compete with charter operators everywhere – primarily based upon price.

Generic charter marketing websites sprung up overnight- and hundreds of operators posted thousands of aircraft available for charter all over the world – including aircraft “on location” for several days- waiting to fly home with the original charter client. This enabled every local operator to market their fleet worldwide- improve fleet utilization- and placed the real-time availability of more than 11-000 turbine charter aircraft at the disposal of any executive with an internet connection.

Now first-time charter users had the tools at their disposal to surf the web and locate the right aircraft at the right price for each and every trip – and no longer had to pay a local operator to position an aircraft to pick up passengers at a remote location.

NOT ALL ARE EQUAL
But as we noted last month- not all charter operators are created equal in operational safety and service. Safety-conscious travelers like you began increasing their use of aviation consultants and charter auditors- to ensure that “lower charter cost” did not mean “lower charter safety.”

By 2000- block time contract discounts had virtually disappeared from the charter industry. The burden of cost control now rested on the charter customer- most of whom don’t have time to vet multiple operators from that universe of 800 charter providers on each trip.

To solve this problem- some charter users rely on their local charter operator to find the right aircraft at the best price when the operator’s own fleet is unavailable. But many more opt to use charter brokers - professionals who work on behalf of multiple clients 24/7. These brokers continually shop- price and monitor operators to ensure that each client is matched with the nearest appropriate aircraft at the best price.

Today- just as internet charter aircraft availability sites have become the de facto marketing department for most charter operators- the cadre of elite professional charter brokers has become their de facto sales arm. And just as all charter operators are not created equal- neither are charter brokers. You must shop for a charter broker as carefully as you do a charter operator.

The charter world has changed markedly during the last decade. Shop carefully. Solicit recommendations from business associates who use charter regularly. Use a professional aviation consultant to help define the options- and recommend the best solution as your charter requirements grow beyond occasional trips. There are other- blended solutions for non-owners. If predictable guaranteed pricing is important- consider alternatives like the Jet Card - the topic of next month’s column.

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editorial@avbuyer.com


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