“Time is our most precious commodity, and there are conveniences that wealth brings to essentially get you more time. —retired Microsoft CEO Steve Ballmer, explaining why he commutes via private jet from his Seattle home to watch games of the Los Angeles Clippers, the basketball team he bought last year for $2 billion. ”
Teaming up to save money
With the economy worsening and the media focusing on the cost of private jet operation, many executives are looking for ways to reduce their travel expenses. If you're not quite ready to trade private jet efficiency for the hassles of commercial aviation, sharing charter flights could be the answer.
Two U.S.-based companies recently launched online networks-CogoJets.com and JetCharterPool.com-that allow members to connect with other private jet travelers and share flights. The networks differ from "empty leg" Web sites, which let customers purchase seats on pre-scheduled flights.
"The flight is not actually booked before the customers log on," explained CogoJets.com founder Jamie Walker, who also serves as CEO of Jet Linx Aviation, an Omaha, Neb.-based charter company. "This is a Web site to create shared flights. The members book flights together."
Likewise, JetCharterPool.com founder Sam Chanana, who previously worked for the charter management company TAG Aviation, said the flights are never pre-scheduled. "I'm not creating a trip or marketing a pre-scheduled flight," he said. "We're not selling seats. We're a networking community."
Customers can become Cogo Jets members by paying an annual fee. They can then propose trip details to other members and when two or more parties agree on the departure dates and destination and arrival cities, they submit the information to Cogo Jets, which acts as a broker and finds an operator to conduct the trip. Each member pays only for his share of the cost of the flight. "If a flight costs $10,000 and four people are sharing the flight, each would be charged $2,500," Walker said. "It's all done through the Web site-booking and payment."
JetCharterPool.com members, who can sign on for three-, six- or 12-month memberships, initiate a flight request and send the request out to other members. The other members can then register as an "interested party" or confirm the flight details. Once the details are confirmed among all interested parties, the members then submit the request through the Web site. "It's a fairly new idea, and I think it's going to attract a lot of executives, especially with the way things are going with commercial aviation," Chanana said.
Because the model is so new, there are some questions as to how popular the Web sites are going to be. "The model we have created is unique to any other model that has been introduced," Walker claimed. "We've found that it's such a new concept that people often confuse it with the empty-leg opportunities. So we're really trying to educate and blaze a new trail."
The success of the shared-jet model depends partly on the number of users the Web sites attract, Walker added. "The more members we have, the more opportunities there will be to take the flights they want," he said. "We're considering a few incentive programs to help people get involved with the program." Through the holidays, Cogo Jets dropped its membership fee from $2,500 to $500, for instance.
While the concept is relatively new, Cogo Jets and Jet Charter Pool are the not the very first of their kind. A similar Web site, JoinTheJetSetters.com, launched last summer but went under within a month or so. The other jet-share models "weren't quite meeting Department of Transportation and FAA expectations," Walker said, adding that he feels confident about the legitimacy of his business model. "I've worked with both departments over the past few years to make sure that what I was doing met their expectations. I did a lot of homework, so this isn't going to be gone in a month. It's a survivable model."
In fact, Walker expects the model to become more popular as the economic downturn continues. "Business aircraft are tools that cannot go away," he said. "If we take that away, we're going to handcuff the ability of Fortune 500 companies to get business done.
"I'm hoping people will see this as an alternate solution," Walker added. "You'll still conduct your business and fly into those smaller airports, but you'll be doing it more efficiently by sharing rather than wasting those empty seats."