Volato cuts 5 HondaJet leases in advance of deliveries

Fractional and jet card operator Volato has ended five HondaJet leases as it receives additional VLJs from the OEM.

According to the announcement, the move reflects “further steps in its ongoing efforts to enhance operational efficiency and profitability.”

The company said, “While Volato successfully negotiated several agreements, efforts to renegotiate the leases on these aircraft did not yield terms that aligned with the company’s financial objectives. As a result, Volato has decided to end these less profitable releases as part of its broader fleet optimization strategy.”

The move will result in savings of about $1.2 million per quarter.

After the move, Volato will still be operating 21 of the HondaJets.

“We have always been transparent about the challenges we face, including delayed aircraft deliveries and the need to manage our fleet size prudently,” said Matt Liotta, CEO of Volato.

The founder added, “Today’s decision is a continuation of our previously announced cost-saving measures and reflects our commitment to making strategic adjustments that position Volato for long-term success.”

Liotta said the operator is expected to grow flying despite the reduction, with more hours flying per aircraft.

The implication for fractional owners, who benefit from charter hours on their tails, could be increased revenue sharing.

Last month, Volato added revenue guarantees as part of a revamp of its fractional program.

Volato was the 17th-largest fractional/charter operator in North America during the first half of 2024.

Per Argus, its flight hours increased by 11.1%.

Liotta added, “We remain confident in the future delivery of new HondaJets and in our ability to meet the evolving needs of our customers.”

He noted, “However, the pace of demand growth, while positive, has not accelerated as quickly as we anticipated. By right-sizing our fleet now, we are ensuring that our operations remain efficient and aligned with both current and future demand.”

New HondaJet deliveries

Volato said it continues to take delivery of HondaJets, expecting eight to 10 by year’s end.

It recently took delivery of its first Gulfstream G280, with another expected by year’s end.

Liotta tells Private Jet Card Comparisons the immediate reduction in HondaJets will result in the furloughing of some pilots.

However, he said there will be no changes to its current fractional or jet card programs.

In its Q2 earnings, the 2021 start-up attributed increased losses to scaling its program, delivery delays, and IPO costs.