March 2, 2024
The largest private jet operator in the world is taking a bullish approach towards the demand for private jet travel in a COVID-19 world.
After taking a cautious approach at the beginning of the current COVID-19 pandemic, NetJets has turned into a bull.
In an email to customers today, NetJets president Patrick Gallagher wrote, “Private aviation fared much better and has rebounded faster, though it is not yet back to pre-pandemic levels.”
Data from WingX showed July 4th holiday travel in the U.S. was 5% ahead of 2019 numbers. Argus now estimates July flight hours for private jets in the U.S. will be at 83% of last year’s levels. Commercial air travel levels remain at less than 30% of pre-pandemic rates.
Last week, WingX reported private jet travel in Europe had surged to 85% of pre-COVID pandemic levels. The reopening of borders is driving the numbers, say analysts.
In late April, Gallagher told customers, “This pandemic is affecting our business to a greater extent than any event since we were founded in May 1964.”
At the time, NetJets announced a workforce reduction of 25% for NetJets Europe. Pilots and cabin crew furloughed by NetJets Europe are being offered reinstatement, according to the letter today.
Recently, NetJets said May was its best month for new customer acquisitions since 2007. The results mirrored other providers reporting record interest from affluent consumers seeking alternatives to the airlines.
Just 90 days after the cuts, there is a 180-degree shift. Gallagher announced, “With a steady increase in flight activity and a promising outlook for growth, we are pleased to inform you that NetJets has decided to reinstate most of the fleet in Europe that was previously planned for disposal. Additionally, we plan to add more than 60 additional aircraft across our worldwide fleet between now and year-end 2021.”
About the reversal, he noted, “These decisions were made amid unparalleled economic uncertainty, when it was unclear how long the period of restricted international flying would last and how the pandemic would impact the broader economy. We sought to insulate our company from deeper reductions later and avoid the need for any bailout while continuing to provide exceptional safety and service to you, our owners.”
NetJets expects to take delivery of its first Bombardier Global 7500 next year. According to its website, since last month, NetJets has added one Citation Latitude, three Longitudes, and one Challenger 650. In June it had also removed the Citation X and Dassault Falcon 2000 from its list of aircraft in the fleet available for new customers.
In May, NetJets waived its 60-minute minimum charges for flights on its Phenom 300, Citation XLS, and Latitude fleet. The move made NetJets, often one of the priciest options, a low-price leader for short hops under 30 minutes.
Also, NetJets accounts for jet card sales at the time of purchase. This means members enjoy the 7.5% discount from the Federal Excise Tax through the 24-month life of their cards. The CARES-related tax holiday is due to expire Dec. 31, 2020.
