Jet Cards Are The Hot Spot of Private Jet Travel

    

With nearly 40 providers and more than 250 programs, jet cards are the hot spot of private aviation with the number of providers having more than doubled in the past 10 years. Like various credit card offers, each with different perks, benefits, facilities and fees, while each jet card program serves the same general purpose of flying you someplace, the devil is in the details. 

Jet Cards Are The Hot Spot of Private Jet Travel

#1. Private Aviation

Private aviation plays a seldom talked about but important roll in global travel and tourism. In the U.S. alone, private jet travel is responsible for creating over one million jobs and more than $200 billion in economic activity each year. Also referred to as business aviation, private travel enables travelers to access more than 5,000 U.S. airports compared to about 500 served by commercial airlines, according to the National Business Aviation Association. It means companies are able to locate offices and plants in communities that have insufficient airline lift. 

"Leisure travelers who arrive by private jet spend an average slightly over $100,000 in each destination they visit, bringing important revenues into local economies"

Since the Great Recession of 2008, the industry has had a slow recovery in terms of new aircraft and fractional jet sales, however, the bring spot is jet cards. Jet cards are akin to debit cards with customers prepaying into a program and then having money deducted from the account each time they fly. Jet cards mostly sell between $50,000 to $1,000,000 and bridge the gap between on-demand charter and full or fractional aircraft ownership.

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#2. On Demand Charter

With on-demand charters, each trip needs to be priced. Buyers typically contact several brokers to compare pricing, and each broker typically provides four or five aircraft options. The buyer then needs to review the options which include specific aircraft, their age, condition and the qualifications of the operator and the pilots. The charter customer also pays for the expense of flying the plane to where they are starting their trip or back to base once they are dropped off. Jet card programs don’t have ferry fees. Then, once making a selection, the buyer has to transfer money, often tens of thousands of dollars on short notice. If there is a mechanical or pilots run out of time, the buyer and the broker have to start the entire process again. The last minute re-quote can mean trip costs significantly increase.

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#3. Fractional and Full Aircraft Ownership

At the same time fractional ownership, which had been made very popular by NetJets and its owner billionaire Warren Buffett before the recession, requires a three to five year commitment. The buyer is purchasing a share of an aircraft, so as with buying an entire aircraft, has to pay money up front. A quarter share of $40 million aircraft means paying $10 million. A glut of used private jets on the market after the recession has meant for the past 10 years residual values dropped significantly. Jet cards fit between charter and ownership, and that’s why the jet card segment is growing rapidly. In fact, NetJets is now a major player in selling jet cards via its acquisition of Marquis Jet Partners.

 

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#4. Jet cards

"Since 2008 the number of jet cards and jet card programs has more than doubled, according to Private Jet Card Comparisons, an independent buyer’s guide that compares over 250 programs from close to 40 providers by more than 65 variables."

Programs have moved beyond the U.S. with global providers such as VistaJet and Europe specific programs from Air Partner, PrivateFly, Victor, Globe Air and Net Jets among others. “The jet card memberships have become popular because once you find the program that fits your unique flying needs, it is a similar experience to owning your jet or fractional ownership. With one call or even online with one click, you can book you jet and have it there within as little as eight hours. You know the standards of jets and pilot qualifications and you don’t have to pay ferry fees,” said Doug Gollan, founder and editor-in-chief of Private Jet Card Comparisons.

"There is a wide variation in policies and fees from service area, where your provider will fly you, to the standards for sourcing aircraft and pilots by each program. We compare over 65 variables." Gollan said key differences go beyond hourly rates and aircraft types. He noted differences range to rules and fees for bringing pets to minimum age for unaccompanied minors and extra charges for de-icing to fuel surcharges and WiFi.

SEP Doug Gollan

Doug Gollan at JSF Senior Executive Program for the Travel Industry in New York, April 2018. Doug is Editor-in-Chief of DG Amazing Experiences, a weekly e-newsletter for private jet owners and Private Jet Card Comparisons, a buyer's guide comparing over 250 jet card programs.

 

Travel tech is continuously changing the industry with new startups emerging and conferences that aim to promote tech in the travel industry. Are you up to date with what's happening? Check out JSF's Digital Transformation in the Tourism Sector (Cancun) program today. 

 

JSF Travel & Tourism School, 23 April 2018

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