Pay it for­ward

Jenny Southan in­ves­ti­gates the pros and cons of pre­paid pri­vate jet cards

Business Traveller (India) - - PRIVATE JETS -

Joe is a Sil­i­con Round­about en­tre­pre­neur based in London. His new job as chief ex­ec­u­tive will see him trav­el­ling more for work, es­pe­cially in the US. He’s happy to use com­mer­cial air­lines to make transat­lantic hops, but when it comes to do­mes­tic flights in Amer­ica he is con­cerned that the has­sle of us­ing con­ven­tional car­ri­ers and air­port se­cu­rity will be coun­ter­pro­duc­tive.

In the US, if you fly more than 400 hours a year on a pri­vate jet, you’re bet­ter off buy­ing your own air­craft, but Joe’s not go­ing to be that guy. In­stead, a busi­ness ac­quain­tance of his has rec­om­mended a “jet card”, which means he can pre­pay for a block of hours or load up an ac­count with credit to use as and when he likes on a pre­de­ter­mined air­craft of his choice.

If Joe de­cides this is right for him, he will re­quire a chunk of cash up­front (this is not for trav­ellers who pre­fer a pay-as-you-go ap­proach to jet char­ter). The ben­e­fits of a sub­scrip­tion will mean he gets to lock in a fixed hourly rate (he only pays for sched­uled flight time – not di­ver­sions, de­lays, fuel, land­ing fees, de-ic­ing or air­craft po­si­tion­ing, for ex­am­ple). He has guar­an­teed avail­abil­ity, there are no peak-hour re­stric­tions and the book­ing process is speedy.

Pri­vate jet cards rep­re­sent 20-25 per cent of char­ter rev­enue for bou­tique bro­ker Sky­time Jets, which launched in 2012. Some 60 per cent of its busi­ness comes from Europe, 30 per cent from the US and 10 per cent from the Mid­dle East and Asia.

James Shot­ton, its co-founder and direc­tor, says: “We work with in­di­vid­u­als who ap­pre­ci­ate that buy­ing a pri­vate jet card is not the cheap­est way to fly but who want very high qual­ity, per­son­alised ser­vice. Cus­tomers can ei­ther ne­go­ti­ate on ev­ery sin­gle char­ter trip and have mul­ti­ple con­ver­sa­tions about price, or have a fixed price agreed at the be­gin­ning so they know ex­actly what they are get­ting.”

That cer­tainty comes at a cost. The cheap­est ten­hour pack­age for a six-seat light jet is `40,00,000, or `4,00,000 an hour, com­pared with ad hoc char­ter of a six-seat Cessna Ci­ta­tion, which might be `1,31,202 an hour. There is a level of se­cu­rity against bank­ruptcy, too, as all pay­ments are put into a ded­i­cated escrow ac­count so Sky­time can only ac­cess it when you want

“In gen­eral, jet cards came about as a nat­u­ral evo­lu­tion of the pri­vate jet mar­ket.”

to book. It lets you roll over unused hours to the next year, al­though not all com­pa­nies will. Be­ing el­i­gi­ble for a re­fund of your bal­ance at any time is also some­thing you will need to en­sure you are en­ti­tled to.

FIRST OFF THE BLOCKS

Sen­tient Jet claims to have been the in­ven­tor of the pri­vate jet card, with 100 per cent of its rev­enue com­ing from this model even af­ter 20 years. Its pres­i­dent and CEO, An­drew Collins, says: “About 60 per cent of our flights are re­lated to busi­ness and 40 per cent to leisure. Whether it’s a top ex­ec­u­tive look­ing to make an im­por­tant board meet­ing in Cleve­land af­ter clos­ing a deal with a client in New York, or a fam­ily mem­ber look­ing to get home in time for the hol­i­days, fly­ing pri­vate is a vi­able way to beat the clock.”

Al­though pri­vate jet cards have been around since the late 1990s, jet char­ter bro­ker Pri­vate­fly didn’t start of­fer­ing one un­til two years ago. Carol Cork, its mar­ket­ing direc­tor and co-founder, says: “Our jet card works very much like an Oys­ter card, al­low­ing cus­tomers to pre­pay for their travel. Feed­back from some of our more fre­quent fly­ers showed us they wanted all of the same on-de­mand cost ben­e­fits and global cov­er­age but with the in­creased speed and con­ve­nience of a pre­paid ac­count.”

What does it cost? The min­i­mum credit you can buy with Pri­vate­fly is `43,73,400 (in this case, you do not buy a bun­dle of hours). In re­turn, you get the “best pos­si­ble char­ter mar­ket price ev­ery time you fly, the fastest re­sponse speeds pos­si­ble when book­ing, flight cred­its on your jet card bal­ance, air­craft up­grades, pre­ferred can­cel­la­tion terms, a ded­i­cated flight ad­vi­sor 24/7, and no black­out pe­ri­ods or peak days”.

How quickly can you go from book­ing to board­ing? Cork says: “We had a jet card cus­tomer go from en­quiry to air­borne in 31 min­utes last week from Mi­ami to Chicago. On av­er­age, al­most a third fly within 24 hours of book­ing, and 66 per cent within a week.”

Delta Air Lines is tar­get­ing the pri­vate mar­ket with its Delta Pri­vate Jets sub­sidiary. As well as sell­ing reg­u­lar char­ters, it of­fers pri­vate jet cards from `65,31,500 up­wards, and you can earn ten Delta Sky Bonus points per dol­lar spent. The flights can also work in con­junc­tion with reg­u­lar Delta ser­vices, with chauf­feur-driven Porsche cars tak­ing you from one do­mes­tic flight to the next, miss­ing out the ter­mi­nal ex­pe­ri­ence al­to­gether.

Other com­pa­nies that sell cards in­clude Air Part­ner, Mag­el­lan Jet, Vis­ta­jet and Flex­jets. Net­jets says its Mar­quis card is “ideal for any­one who flies un­der 50 hours per year and prefers a short-term com­mit­ment”. Crew­ing, sched­ul­ing, main­te­nance and cater­ing are all part of the pack­age. Philip Baer, Net­jets’ se­nior vice-pres­i­dent of the UK and Nordics, says the card “is in­tended as a trial pro­gramme or for those who fly in­fre­quently” (the com­pany’s main fo­cus is on frac­tional own­er­ship of its fleet of 700 jets).

Cork says: “In gen­eral, jet cards came about as a nat­u­ral evo­lu­tion of the pri­vate jet mar­ket. First, you could own your own pri­vate air­craft, then frac­tional own­er­ship was cre­ated for those who wanted a share in a spe­cific fleet, then a jet card be­came de­sir­able, of­fer­ing a block of fly­ing time, but with­out the full or part-share fi­nan­cial in­vest­ment of the air­craft as­set.”

COM­PARE AND CON­TRAST

Jour­nal­ist and jet ex­pert Doug Gol­lan says do­ing your re­search is es­sen­tial, which is why he founded pri­vate­jet­card­com­par­isons.com, a site de­signed to help you work out what suits you best. He says: “Do rich peo­ple re­ally buy these pro­grammes with­out read­ing the fine print? All the time. What hap­pens? They get very up­set af­ter they see their first in­voice.”

A lot of peo­ple choose a card based on a friend’s rec­om­men­da­tion, he says.“But they might be do­ing a lot of two- or three-hour flights, whereas I want to do 20 flights to Bos­ton, which take 40 min­utes. One of the jet card vari­ants is ‘daily min­i­mums’– if your provider has a 90-minute daily min­i­mum they will charge my 40-minute flight as an hour and a half.”

Left: Sky­time Jets’ Le­gacy 500

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