With consumers ready to dive all-in to private flying and evaporating supply, Flexjet has halted accepting new jet card customers as of yesterday.
The company is not changing terms for existing jet card customers. It will allow current jet card customers to renew with changes.
The critical difference is both peak and non-peak day call-out will be at 120 hours. Previously, the non-peak booking window was 24 hours.
Surcharge on peak days will be 25% on both its Phenom 300 and Challenger 300 cards.
Flexjet had already raised hourly rates on both cards, but as demand continued, Flexjet CEO Mike Silvestro said more rate increases didn’t make sense.
“We didn’t want to be seen as gouging, and price didn’t matter anyway because there wasn’t supply,” he said.
The industry is straining to handle record demand with no let-up in sight. At the same time, many issues are impacting operations, making the bull market difficult for providers.
Other providers, including NetJets, Executive Jet Management, Jet Linx Aviation, Priester Aviation, and Flexjet sister company Sentient Jet have halted new jet card sales in recent weeks.
The good news Silvestro says is many customers were bypassing jet cards for fractional ownership – or converting from cards to fractional ownership.
Flexjet is selling its entire product line with delivery dates throughout 2022. Customers who buy shares then sign temporary leases so they can fly right away and until their tail is delivered.
Silvestro says the pause is “absolutely driven by the supply issues of not being able to accelerate (enough) deliveries.”
The Flexjet CEO believes the current market is setting the table for a renaissance in fractional ownership.
Many fractional owners transitioned to jet cards during and after the 2008 financial meltdown. They preferred committing 25 or 50 hours at a time. Since then, the number of jet card sellers has tripled.
Now, covid has made private flying a necessity.
A recent survey of Private Jet Card Comparisons subscribers found 100% of those who started flying privately due to Covid plan to continue post-pandemic. Over half said they will use private flights regularly.
