From Charter Jets to Block Charter: A Diverse Range of Flight Solutions

 
From Charter Jets to Block Charter: A Diverse Range of Flight Solutions— Originally published in BusinessAir Magazine, February 2014, Volume 24, No. 2.

As non-commercial business flight solutions continue to evolve, there are now many different choices available, whether you are looking for a long-term or interim flight solution. Some of these go beyond the typical “jet card,” so it’s helpful to understand the full range of options from jet cards to block charter to membership programs.

All aircraft owners come to realize that there probably will be times when their aircraft goes into scheduled maintenance for an extended duration. There are other times when the aircraft is being sold and a replacement aircraft hasn’t yet been acquired. During these times, owners who need interim solutions often charter from their management company, purchase a block of hours through a charter vendor or buy a jet card. Any of these solutions can work – depending on the specific facts of your flying needs, the amount of time you require interim lift and how flexible your travel schedule is regarding departure time and aircraft type.

The jet card became popular in the early 2000s when Marquis Jet entered the market. For many customers, the jet card has been a way to have the caliber of service and safety that one would receive in a fractional program without a long-term commitment or any capital investment. Since the early 2000s, this niche has continued to grow and, as it has expanded, the terms available and the product offerings have gotten more creative. These days, the jet card customer can choose from a number of nationally recognized providers, including Marquis, Flight Options, Flexjet, Sentient Jet, Delta PrivateJets, TWC Debonair and Air Partner, among others.

In most jet card programs, participants pre-purchase their cards in 25-hour increments. Card holders can book a flight on a jet at any time and to any destination with very short notice. Argus, an aviation information and auditing company, offers a very helpful tool to help evaluate various Jet Card Programs. The Argus quarterly Jet Card Comparison is available at http://argus.aero/FreeData.aspx. There are also consultants who specialize in helping clients select the right private aviation solution. These consultants can bring value because they understand the various programs available and can make sure all options are considered.

As with charter companies, one of the important distinctions among jet card programs is whether the provider operates its own aircraft or charters the flights on aircraft operated by other companies. For your safety, it is important to perform your due diligence on the company that you will be using. It is harder to verify safety performance if the company is a broker using multiple operators. It is also important to understand the financial condition of the company to whom you are making your jet card prepayment. For example, cardholders who prepaid for services through the Avantair program in late 2012 and early 2013 were left without access to flights and without any way to recover their prepayment after that company was forced into bankruptcy in July 2013. Those cardholders can file claims as unsecured creditors, but it is unclear whether they will ever be able to recoup anything out of the bankruptcy estate.

Block charter agreements are another prepaid flying option. These agreements offer discounts in exchange for agreeing to purchase a certain number of charter hours, or blocks, to be used over a designated period of time. Block charter is advantageous for anyone who definitely knows they will use the pre-paid time in the time period allotted. However, prepayment comes with the same risks you have with prepaying a jet card. Therefore, knowing the financial situation of the provider is vital.

Also emerging from the jet card model are membership programs such as Wheels Up. Wheels Up and other similar membership plans allow payment of an initiation fee that provides unlimited access to an operator’s fleet of aircraft at a guaranteed price per hour. Unlike jet cards and block charter, under the membership program, there is no prepayment of hours which allows maximum financial protection.

Understanding the diverse array of flight solutions can be overwhelming in today’s market, but with the wealth of choices available, it is safe to say that there is a solution to suit every customer’s needs.

Please contact Amanda Applegate at 877-237-5398 or aapplegate@aerlex.com.