Welcome back to travel.
It has been an exciting past few months, to say the least, as private aviation has experienced unbridled growth. Some providers are even pumping the brakes by announcing a halt on jet card sales.
In July, flight volumes industry-wide were up 44% relative to pre-COVID July 2019. For PJS, the bulk of this increase in demand stems from the revival of business travel as in-person meetings and events resume alongside leisure demand. We expect this trend to continue and compound for the rest of 2021 and into next year. August and September data point to this trend continuing.
Challenges Of Growth
While we never shy away from growth, this influx in private aviation presents an entirely new set of challenges. PJS takes our commitment to finding you the best aircraft options on the market seriously and believes in total transparency as part of our consultancy approach. This is why we share with you today what we are up against as an industry:
- Low Inventory — As a result of high demand, aircraft availability is becoming challenging. This applies to both the charter market as well as the secondary market for aircraft. The industry is running up against a lack of new charter inventory due to decreased aircraft manufacturing during the Great Recession and the increased demand. Existing fleets are simply not large enough to handle the demand nor frequent requests for the newest aircraft.
- Increased Rates — During COVID, we saw depressed rates because aircraft were significantly underutilized. Rates are climbing back up to pre-COVID prices and beyond, where inventory remains low. This is causing frustration among private aviation users who may be accustomed to numerous aircraft options and lower rates.
- Increased Mechanical Issues — More usage of the charter fleet means more wear and tear on aircraft. This has impacted the frequency of mechanical issues resulting in delays and, on one occasion, cancellation. The Light Jet category appears particularly affected at this time.
- Fuel Infrastructure — Jet fuel shortages abound worldwide — the lowest supply in nearly 30 years — are also challenging smooth operations.
- Labor & Crew Availability — The pandemic, along with a faster and larger than expected return to travel, is exacerbating pilots and straining training facilities. Organizations, including the commercial carriers, are scrambling to get pilots through training and back active. In addition, with the shortage and demand in the labor market, maintenance facilities are struggling to staff to meet the increasing needs of a fully utilized private aviation ecosystem.
Our team is determined to continue providing air charter services by finding you “lift” for those mission-critical moments or advising you on aviation solutions. Here are some of the proactive steps we are taking to stay ahead of the game:
- Monitoring new aircraft entering the charter market to align our clients with supply. Air carriers large and small are working to bring aircraft to the charter market to meet demand. Identifying new supply allows our clients to have more initial aircraft options as well as contingencies.
- Increasing our fleet’s size through our subsidiary Elevate Jet. In the past twelve months, we doubled the number of aircraft under management. In August, Elevate Jet added two new aircraft to its managed fleet, and we plan to double the size of the fleet again in the next 12 months.
- Assessing aircraft for reliability, not just choosing anything available. With the increased utilization, we prioritize aircraft maintained under proactive maintenance schedules and avoid those that have been overutilized to meet the unbridled demand.
- Encouraging early booking to be able to provide a breadth of options. While we are adept at last-minute operations and will always prioritize the best aircraft options, with advanced notice, we can give you more choices at optimal prices during this compression.
Beyond our proactive approach to the changes in the industry, we continue to offer the same level of commitment to guaranteeing aircraft availability in any scenario. Through PJS’ Total Flight Management (TFM), we deliver with zero Peak Days or “black-out dates.” These premium services and PJS standards will always remain in place.
PJS is up for the challenge. We hope you will continue to trust our advisors with your private aviation needs as we grow through this challenging phase in the industry.
Andrew VanderPloeg | Senior Vice President of Sales