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Private charter industry employs 'beat the recession' marketing tactics
Private charter operations, fractional services and brokers are trying to defy the global recession by targeting business growth regions, introducing jet cards, refining deployment of fleets and seeking new sales outlets.

Private charter operations, fractional services and brokers are trying to defy the global recession by targeting business growth regions, introducing jet cards, refining deployment of fleets and seeking new sales outlets. With reports that private charter business is as much as 50 per cent down so far in 2009 from levels in early 2008, operators are having to use initiative and ingenuity. Fractional provider NetJets Europe launched the "Summer Card" for Middle Eastern customers who are planning to spend their vacation in Europe this summer. The jet card is valid from May until the end of October and is touted as providing "the flexibility and convenience required by Middle Eastern customers that visit numerous cities around Europe during their annual summer break." The cards are available in 12.5-hour increments.

Lisbon-based private jet company Jet Republic is among companies seeking new business outlets. It is marketing its Private Jet Card through travel agents. "The price of the card will start at ?€130,000 with Jet Republic paying a one-off commission of €5,000 to travel agents for each card they sell," says ceo Jonathan Breeze. "Travel agents will also be able to buy the card for themselves and sell flight time to clients individually, earning five per cent per flight in service fees." Breeze adds: "For travel agents servicing the ultra high net worth market, the card provides a market leading private jet proposition which clients who need to travel regularly or to remote parts of Europe should find appealing."

Jet Republic's Private Jet Card provides members with 25 hours of flight time without any further commitment or expiry date, no landing fees and no fuel surcharges. "It offers the benefits of private aviation with the simple pricing structure of a one-off payment," Breeze says. "Card membership will give access to a network of light, midsize, large and global aircraft, with flights available anywhere in the world through Jet Republic's partnerships with other operators." Card members, he says, also receive access to 24-hour global concierge services with a "virtual executive aide" on-call day and night with the full resources of the concierge's worldwide network. In September 2008, Jet Republic placed a $1.5 billion order for 110 Learjet 60 XR aircraft. The first aircraft is scheduled to be operational from October 2009.

Prague-based Grossmann Jet Services (GJS) maintains that it is not feeling the pinch in the current financial climate. The company's own research, it says, indicates that business jet travel in Europe is growing at double the speed of conventional air transport. "There are now around 3,000 business aircraft in Europe, with this number set to hit 4,600 by 2017," says ceo Dagmar Grossmann.

The company, she says, has identified the Czech market as particularly underdeveloped and estimates it could hold potential business of around ?20 million. "To tap into this, GJS has initiated collaboration with a number of local travel agencies," says Grossmann.

In February travel agencies were invited to a workshop which included a discussion during which GJS pilot Michal Hudecek described how crew training procedures for business jets does not differ from those of commercial flights.

Air Partner, however, reports, that results for the six months ending January 2009 saw sales down two per cent to €107.1 million and profit before tax reduced 17 per cent to €3.2 million. It says: "The private aviation services market has reduced but long-term drivers remain in place and the company's diversification strategy provides resilience. Clients are increasingly insisting on quality and financially sound providers of aviation services."

David Savile, ceo, says: "The team at Air Partner has worked hard to produce these results in extremely tough trading conditions. Air Partner's experienced management, strong cash position, zero debt, good cash generation and excellent dividend growth all position the group for the difficult trading environment we are currently experiencing. The board remains confident in the long-term drivers and prospects of the group. It is also encouraging to see the progress made across mainland Europe, through our key offices in France, Germany, Italy and Austria, as smaller local competitors have waned. Industry statistics are too generalised to be a reliable indicator for specific markets but low season traffic levels are down by up to 50 per cent in the US and 20 per cent in Europe, largely on lower corporate levels." Savile adds: "'We anticipate that corporate activity will remain low for the second half, but we were encouraged that ultra high net worth flying for the winter half term holiday was busy, creating evidence for some optimism ahead of the summer season."

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