NetJets hints returning jet card sales; blasts competitors

By Doug Gollan, December 31, 2021

NetJets says it hopes “to return to selling our full product lineup by Spring” while blasting competitors

In an email to customers and prospects, NetJets says it will “gradually resume sales starting in Q1.”

The message, which came “from our leadership,” noted, “With continued aircraft deliveries and a normalizing of flying patterns expected by the end of March, we hope to return to selling our full product lineup by Spring.”

It added, “While the current availability of shares and leases varies by aircraft type because of demand, we are accepting a record number of deposits to help owners plan for their travel needs into 2022 and beyond.”

In October, NetJets stopped offering interim leases, which allow fractional share buyers to fly until their aircraft is delivered.

In August, NetJets was among the first providers to halt jet card sales to new customers and renewals. The update said the world’s largest operator of private jets now has a waitlist of over 2,000.

NetJets slaps competitors

NetJets wrote, “As the rest of the industry is forced to prioritize profit over customer satisfaction, we are proud to be able to put our focus on protecting the exceptional travel experience we offer our owners.”

The email also took aim at recent promotions, claiming, “Because most of our competitors don’t have our level of financial security, some are dropping their rates or creating new incentives to generate short-term cash despite short industry supply and record demand.”

In another swipe, the message noted, “Every single one of our major competitors had to rely on government bailouts to make it through the pandemic. But not NetJets.”

NetJets is a subsidiary of Berkshire Hathaway.

The CARES Act provided hundreds of millions of dollars in relief for private aviation providers.

The rebound of private travel came fast. It was unexpected at the beginning of the pandemic when flying fell by 80%.

In April 2020, NetJets’ president Patrick 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, it announced a workforce reduction of 25% for NetJets Europe. By July, it was hiring back workers.

May 2020 was NetJets’ best month for new customer acquisitions since 2007. Recently, charter and fractional flights have been tracking more than 20% ahead of pre-pandemic levels. Since June, the industry has been breaking records on a monthly basis.

Over 600,000 passengers in 2021

The email also recapped NetJets’ initiatives from fleet growth to sustainability and catering.

The unscheduled airline added 14 aircraft this month and last. It will have added 55 this year, with 75 more coming in 2022.

It also ordered up to 100 Phenom 300Es to be delivered to the U.S. and European fleets.

In 2021, it added 630 new positions, including over 300 pilots, with recruiting to continue next year.

In the first year of its Global Sustainability Initiative, it uplifted over 751,000 gallons of SAF, flying over 2.5 million nautical miles with sustainable fuel.

There was a 71% enrollment increase in its Blue Skies carbon offset program. Customers pay to offset their flights.

The letter also addressed current supply chain challenges. “Air travel infrastructure is being taxed in ways we have never experienced. Everyone is feeling significant air traffic control delays, and everything from fueling and ramp space to catering and ground transportation are being pushed to their maximum capacity.”

NetJets is flying catering in from larger cities to ease the overload on caterers. It is also utilizing delivery services and partnering with local restaurants.

One byproduct was its new partnerships with Major Food Group-owned restaurants Sadelle’s and Parm, and Michelin chef Jean-Georges Vongerichten. The latter is currently being tested in New York.

To enhance reliability, it has expanded large-scale maintenance facilities in California, Colorado, Texas, and Florida. It also plans to grow its own private lounges in both the U.S. and Europe, according to the message.

Earlier this week NetJets said its European branch had sent 15 jets to the U.S. to help with peak demand.

NetJets says current flying levels are 30% higher than pre-pandemic. In 2021 it will carry over 600,000 passengers, up from 500,000 in 2019.

Spirited Competition

The sharp elbows are nothing new. NetJets has been critical of the CARES Act monies provided to the industry from the outset.

At the same time, competitors often target NetJets in their marketing. Most recently, KKR-backed Jet Edge said it had taken a billboard touting low fares to Hawaii and the East Coast. It is located outside the terminal NetJets uses at Van Nuys Airport in Los Angeles.

In 2019 Flexjet ran an ad campaign with headlines reading “Shift Happens – Switch to Flexjet, and You’ll Never Look Back,” “More Than A Jet From The Net,” and “Happy Pilots Are Safe Pilots.”

Earlier this year, Airshare targeted Wheels Up in a regional ad campaign.

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