The Private Jet Company CEO Dan Jennings says a shortage of private jets available for charter during peak periods will push private jet rental costs higher
Dan Jennings, the CEO of whole aircraft broker Private Jet Company, says increased demand for private jet charter – on-demand and through jet cards – could push up pricing by up to 20%.
“The consolidation among private jet charter companies means there are fewer operators controlling larger fleets. This is not bringing any additional aircraft into the charter market,” says Jennings. The Private Jet Company (TPJC) provides sales, acquisition and a range of consulting services to private jet buyers and sellers.
Combined with increased demand, he predicts the private jet charter market to see increased charter prices and reduced plane availability and experience quality.
He continues, “Because of the long lead time to manufacture aircraft, the 10%-20% increase in demand for private jet charter flights since the start of the pandemic and the consolidation in the charter industry will soon put upward pressure on prices for charter flights, particularly for those using private jet charter brokers. For travel on weekends and holidays, the increased demand and static supply of private aircraft mean fewer planes will be available. In addition, charter clients might not get the type of plane and experience quality they expect.”
Private jet shortages
Part of the shortage is based on timing. He notes a large portion of the charter fleet is managed aircraft. Owners rent out their jets when they aren’t using them. However, more jet owners are flying privately during peak periods. At the same time, demand for charters is peaking.
“If you want to charter a jet on a Tuesday, for example, there’s usually no problem, but if it’s Memorial Day weekend or the 4th of July, you could be hard-pressed to find a private jet to charter – or one that meets your expectations,” says Jennings.
He adds, “The problem of supply is exacerbated on the most popular routes – up and down the East or West coasts and cross-country.”
He says charter prices could spike by up to 20%. Jennings says he expects increasing prices to charter jets and lower quality will drive more regular users to look into buying.
More companies are rolling out alternative ownership solutions. Jet Linx, Jet Edge, Fly Exclusive, and Verijet are among operators that have launched new ownership concepts. Partners In Aviation, a Match dot com offering shared ownership, recently said it sees record interest.
An analysis of entry-level fixed-rate jet card pricing from the Private Jet Card Comparisons U.S. database of more than 50 providers shows all-in hourly rates for jet cards with guaranteed availability are 5.84% to 8.67% higher than December 2020, based on aircraft type.
Much of the increase from December 2020 can be attributed to the restoration of the FET. That tax was waived until Jan. 1, 2021, as part of the CARES Act. Many, but not all companies, reduced their prices during the tax holiday.