October 21, 2024
In the world of private aviation solutions – fractional ownership, leases, jet cards, memberships, seat sharing, semiprivate airlines, and so forth, four companies have generated the most interest, according to Google Trends. Surprisingly, perhaps, they are each quite different once you get past the fact that they all want to fly you somewhere.
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At the same time, interest in private aviation providers still pales compared to other sellers of luxury. For example, Rolex, Cartier, and Ritz-Carlton each generate significantly higher interest than Wheels Up.
However, since this is about most searched private aviation solution providers, let’s look at the differences between NetJets, Wheels Up, Jet Smarter and JetSuite.
From larger publicly traded companies, to private equity, the founders, celebrities, royalty and other airlines, the ownership story is diverse.
While the fractional share owners of the NetJets fleet, Warren Buffett’s Berkshire Hathaway owns the company.
Wheels Up is privately held and its CEO Kenny Dichter has an ownership stake. Companies that have been mentioned as investors include T. Rowe Price, Fidelity, and NEA. Earlier this year Dichter said he had hired Bank of America and Goldman Sachs to advise on strategic initiatives. The company has been mentioned as a target for Amazon, Google, and Uber both of which are thought to have an interest in the private aviation space.
JetSmarter is privately held. Its founder and CEO Sergey Petrossov, Clearlake Financial and Jefferies Financial Group are thought to hold significant stakes. The Saudi Royal Family and Jay-Z were earlier investors, but it’s unknown if they still are part of the ownership. That said, JetSmarter recently agreed to be acquired by XOJET and VistaJet parent Vista Global, led by Swiss UHNW Thomas Flohr who is backed by Rhone Capital. JetSmarter’s current owners would get shares in the new company has part of the deal, which is expected to close this quarter.
JetSuite and its sister JetSuiteX were founded by veteran airline executive Alex Wilcox who cut his teeth at Virgin Atlantic Airways and then helped launch JetBlue. Initially backed by several UHNWs, it now counts JetBlue and Qatar Airways as key investors.
Private aviation offers a number of options, including fractional ownership, private jet leases, jet cards, flight sharing, scheduled semiprivate flights, empty legs and more. Here we brake down what each company is selling.
There are only four providers selling fractional shares of private jets on a national basis in the U.S., and NetJets is the dominant player. According to data from Argus TRAQPak, last year NetJets had 64% of hours flown while Directional Aviation’s Flexjet was second at 15%. Combined with sister Flight Options, which is being phased out, Directional had about 20% share. Nicholas Air flew 10,449 hours compared to 365,710 for NetJets.
Recently, Dumont Group entered the national scene by offering fractional shares in its fleet of Dassault Falcon 2000 large-cabin jets. Neither NetJets or Flexjet offer turboprop share options, something Nicholas Air does with the Pilatus PC-12. PlaneSense, which sells shares on the PC-24 and PC-12 has been moving its primary service area westwards and is eventually expected to be national.
JetSmarter – No
JetSuite – No
NetJets – Yes
Wheels Up – No
The questions of fractional share or lease generally has to do with whether or not a company wants private jet ownership on their books and the tax benefits of ownership versus lease. Among JetSmarter, JetSuite, NetJets and Wheels Up, only NetJets offers leases.
JetSmarter – No
JetSuite – No
NetJets – Yes
Wheels Up – No
NetJets and JetSuite both offer traditional jet cards requiring a deposit and then providing fixed rates and guaranteed availability. For JetSuite, they offer programs on an owned fleet of Phenom 300s and 100s, while NetJets uses its fractional fleet with cards starting at 25 hours.
NetJets entry card is on its Citation Excel/XLS and then offers options that include a Gulfstream GVIP with ferry free flights to Europe as well as its Marquis Jet Cross Country jet card that offers the Challenger 350 or Citation X for flights 3.5 hours or longer and the Excel/XLS fleet for shorter flights.
Wheels Up offers a pay-as-you-go membership model, which includes initiation and annual fee. The individual membership in year one is $17,500, although you can save money buying via Costco. It offers fixed rates and guaranteed availability on an owned fleet of King Air 350is and Excel/XLSs. Earlier this year it added an off-fleet light jet program east of the Mississippi.
Fun fact: NetJet only entered the jet card market when it purchased Marquis Jet Partners in 2010 from its founder Kenny Dichter, who then three years later launched Wheels Up.
JetSmarter sells its “anti-jet card” which is a cabin category based on-demand charter program.
JetSmarter – No
JetSuite – Yes
NetJets – Yes
Wheels Up – Yes
On-demand charter simply refers to getting a one-off quote for each trip, and all four players play in the space, although NetJets does it via sister company Executive Jet Management. Wheels Up uses on-demand charter when members need super midsize or large-cabin jets, which are not in its fixed rate program. JetSuite offers one-off charters both on its fleet and off-fleet, while JetSmarter sells charters via its app, its technology thought to be a prime reason for Vista Global’s interest.
JetSmarter – Yes
JetSuite – Yes
NetJets – Yes (via Executive Jet Management)
Wheels Up – Yes (for members only)
One of the big attractions of private flying is skipping the crowds and time spent traversing large airports. However, one challenge is in many cases entrants in the scheduled semiprivate market haven’t had the frequency travelers need. There’s a limited market of people who will wait two days to save two hours of travel time. To that end, JetSuite X seems to have developed a winning formula. It recently announced flights from Oakland to Seattle’s Boeing Field. It offers core routes between the Los Angeles basin and the San Francisco Bay area and from Burbank to Las Vegas it has as many as seven flights per day.
Instead of using private jets, it has a fleet of reconfigured regional jets with Wifi, free drinks, and first-class legroom. The economics of the regional jets allow JetSuiteX to charge fares often under $200 making it not only fast and frequent but affordable.
JetSmarter – No
JetSuite – Yes
NetJets – No
Wheels Up – No
JetSmarter now sells members and non-members seats on flights it schedules, although schedules change monthly, and flight are crowdsourced between members that can pop up close to departure. The latter only fly if enough members buy seats. Seat prices range from under $1,000 to typically in the $2,000 to $5,000 range.
JetSmarter – Yes
JetSuite – No
NetJets – No
Wheels Up – No
JetSmarter’s most recent push has been crowdsourcing flights, running the flights if enough members buy into a specific flight with seats that can range from hundreds to thousands of dollars. Recently, Wheels Up launched a Connect membership. It enables Connect members to access its community board where members propose sharing flights. Members work out their own deals for both flight timings and who pays what, although Wheels Up handles the billing to each member.
JetSmarter – Yes
JetSuite – No
NetJets – No
Wheels Up Yes
Empty legs are the ferry flights that private jets make before or after dropping off or picking up the folks paying thousands of dollars per hour. JetSmarter sells empty legs by the seat with prices varying based on jet size and flight distance. Wheels Up offers empty legs, typically around $300 to its members, with full members getting unlimited access and Connect members limited empties. JetSuite several years ago was posting empty legs for as little as $500 on its Facebook page, although that has ended.
JetSmarter – Yes
JetSuite – Yes
NetJets – No
Wheels Up – Yes
NetJets’ Executive Jet Management is one of the largest management businesses.
JetSmarter – No
JetSuite – No
NetJets – Yes – through Executive Jet Management
Wheels Up – No
In some ways, it’s interesting that four companies that are so different – despite their similarities – rank atop Google searches. For those of you who have heard about them, but wasn’t sure what they did and how they are different, hopefully, this helps.
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