Like the rest of the aviation industry, the nation’s large fractional-ownership companies were hard hit by the recession. Now, the market has stabilized, business is improving and furloughed pilots are being recalled.
During the recent economic downturn, the number of new air travel customers fell, and existing customers failed to renew their contracts or left them early. During the first quarter of 2011, Flight Options sales were up significantly with customers adding more air travel to their schedules.
“Things are getting better,” said Cleveland-based Flight Options CEO Mike Silvestro. Flight Options recalled 25 of the 200 pilots it furloughed, Silvestro said.
CitationAir made offers to all 85 pilots furloughed in 2009. Fifty-three have been recalled and plans are being made to replace the pilots who will not return with newly hired pilots, it said recently. The company now employs 334 pilots.
Fractional providers sell shares of business jets and charge monthly management and hourly fees for usage. They also offer jet cards with a set number of flight hours. In addition, some manage aircraft for owners.
The fractional market is dominated by four providers who share about 95 percent of the market: Flexjet, a subsidiary of Bombardier; Flight Options; CitationAir, a subsidiary of Cessna Aircraft; and NetJets, a subsidiary of Berkshire Hathaway.
NetJets and Flight Options have also each placed large orders with Brazil-based Embraer for Phenom business jets. Flight Options ordered 100 of the jets, while NetJets ordered 50 planes with an option for 75 more.
Regional fractional provider Executive AirShare has bucked much of the downward trend during the economic downturn. “We’ve been impacted way less than the nationals,” said chairman and CEO Bob Taylor.
Executive AirShare had year-over-year growth in sales and flight hours in 2008, 2009 and 2010, Taylor said. “We feel like… 2011 will be our best year ever,” he said.
Most of its growth has been related to the acceptance of its fleet of Embraer-built Phenom 100 and 300 aircraft, Taylor said. The company has eight Phenoms in its fractional fleet and another 28 on order for delivery between now and 2014.
Executive AirShare is also expanding its U.S. presence. It recently opened a base in Buffalo, N.Y., and will add a base in Houston this year.