Businesses and individuals choosing to fly by private jet can expect to see increased charter prices and reduced aircraft availability and experience quality due to the recent consolidations of private aviation charter companies and the rising demand for private jet charter flights, according to Palm Beach, Florida-based private jet brokerage The Private Jet Company (TPJC).
“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,” explains CEO Daniel Jennings. TPJC provides sales, acquisition and a range of consulting services to private jet buyers and sellers.
Jennings continues: “Because of the long lead time to manufacture aircraft, the 10-20 per cent 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 means fewer planes will be available. In addition, charter clients might not get the type of plane and experience quality they expect.”
Typically, owners of private jets can charter out their aircraft when they do not need them to help subsidise the costs of owning and maintaining a private plane. However, Jennings pointed out, owners frequently use them at exactly the same time, such as weekends and holidays, when there is peak charter demand. The majority of private charter flights are on individual owner-owned aircraft, managed by a charter company or charter broker.
“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,” he says. “The problem of supply is exacerbated on the most popular routes, namely up and down the east or west coasts and cross-country.”
Someone who regularly pays $15,000 to fly on a private jet charter between New York and Miami may not mind paying an additional 10-20 per cent, but the reduced availability and unpredictable type and quality of aircraft to charter may be the motivation that pushes them in the direction of purchasing, rather than chartering.
“When supply is tight, particularly on a popular route, you might wind up with a plane where the wi-fi doesn't work, two seats don't recline or some other annoying problem,” Jennings points out.
For individuals and businesses who can afford to purchase a private jet, now may be the ideal time to do so. “In addition to solving the problems of the increasing cost and uncertainty of obtaining the consistent high quality experience you expect in a private jet charter, buying a pre-owned private jet has major tax advantages that were put in place during the Trump administration, such as 100 per cent write-off of the depreciation of the full purchase price in 2021, and which will certainly go away soon,” he concludes.