Why Service Has Deteriorated—and Why It Might Improve

Today’s hot market has made it tougher for lift providers to avoid glitches, but changes may be coming.

First, the bad news, if the service you expect from your lift provider has fallen short recently: today’s unprecedented demand coupled with systemic strains—from supply-chain issues to personnel and aircraft shortages—means better private air travel options are likely unavailable now.

The good news for travelers is that the first declines in flight activity since the market recovery from COVID began have just registered, with indicators pointing to softening demand ahead, which should translate to reduced travel glitches for private flyers. 

Unlike the airlines, the charter industry doesn’t track on-time performance, and business aviation customers seem less prone to vent online about unhappy travel experiences than their commercial counterparts. That makes gauging the extent of current problems and historical comparisons difficult, but from a macro point of view, “I'd argue that commercial [aviation] is on time more than private in this market,” says Craig Ross, founder and CEO of AviationPortfolio (AP), a subscription-based service largely involved in access issues. 

California-based AP advises and advocates for clients—fractional and whole-aircraft owners, and access card and high-time charter customers—to ensure they receive the service their contracts promise. That advocacy includes real-time intercession for clients when their travel arrangements are upended, and from what Ross has seen in recent months, “There are delays every day.”

Additionally, many prospective charter flights are never even booked, because no aircraft are available, according to numerous anecdotal accounts, creating more disruption across the access space.

Ross, a former Marquis Jet Card executive, founded AP in 2011, and the changes among its client base—initially consisting of about 80 percent charter users and 20 percent card and fractional-program members—trace the seismic shift in the market since. At the time, “There was an excess of capacity, and you were able to book a plane less than 10 years old with an experienced crew from a high-quality operator for arguably 50 percent less than other solutions,” Ross says. Today, only 10 percent of his clients primarily use charter, “because the value, economically and experientially, is in the [card and fractional] programs.”

Have Realistic Expectations

However, given the inevitable service shortfalls in today’s environment, aligning expectations with what a program promises is critical, Ross says. Yet many customers “don't understand the terms of the charter, jet card, or fractional agreement.” 

The program representatives who explain and sell the access plans, he says, typically don’t address the issues adequately, possibly creating mistaken assumptions or unrealistic expectations. That may not have mattered as much in an era of excess capacity, but now many long-time private flyers are learning the hard way about usage limitations, restrictive upgrade policies, slot shortages, and added fees.

AP’s clients are all served by a relatively small number of top-tier access programs and management firms, but that still requires a full-time team at AP just to track the frequent changes in program rules and details, another potential pain point for customers.

Meanwhile, many of the unprecedented numbers of new business aviation consumers who’ve propelled its recent growth “don't understand how many things can go wrong when booking a private flight,” according to Ross, and “they haven't adjusted their tolerance for risk when entering the market.”

The bottom line: if you understand your access plan and have realistic expectations, “a lot of the pain, and the anger, and emotion [of service problems] is avoidable,” Ross says.

Signaling the nascent easing of demand, “flight activity in North America is starting to flatten out,” Argus International president and CEO Joe Moeggenberg said in July at a Corporate Jet Investor online town hall, predicting “a year-over-year decline [in July] for the first month since the beginning of the pandemic.”

Declining Flight Activity

According to WingX, charter and fractional activity in the region was down 7 percent year-over-year in late July, with the bellwether Texas, California, and Florida markets showing “sizable” declines. Additionally, utilization of “workhorse” models—including the G400/450, Cessna Citation XBombardier Challenger 300, and Embraer Phenom 300—is “considerably off” levels from a year ago, the Hamburg, Germany–based bizav intelligence firm says. Globally, business aircraft activity was down 0.4 percent in late July, though still 13 percent above pre-pandemic 2019. 

Moeggenberg at Colorado-based Argus cites rising charter rates and jet card prices, along with a spike in fuel costs among the reasons for the decline. 

“At some point, it’s going to get too expensive for a certain segment of that market,” he says, noting that the average per-hour charter rate for a midsize jet rose from $6,900 about 18 months ago to $9,300 today, and jet-A recently hit $12 per gallon at the New York metro’s Teterboro [New Jersey] Airport. Jet card prices have not only increased “by a lot,” but operators are moving toward dynamic pricing, Moeggenberg adds. “If you want to travel from Teterboro to West Palm Beach, going on Wednesday is going to be less expensive than going on Friday afternoon.”

For current customers unwilling to wait for softening demand to improve their program’s service, “It’s possible there's a better solution, a more appropriate solution, or maybe a supplemental solution,” says Ross, “but in this environment, there are no great options.”