Unprecedented Charter Demand Sparks Renewed Interest in Aircraft Acquisition

Michael J. Moore Executive Vice President
Unprecedented Charter Demand Sparks Renewed Interest in Aircraft Acquisition

It’s been over a year since the World Health Organization formally declared the novel coronavirus outbreak a global pandemic. The private aviation industry has been through some significant changes in that time period, with demand coming to an almost complete standstill in the early months of the pandemic. This steep decline in demand can be attributed to a number of factors, including domestic and international travel restrictions and personal safety concerns.

Over the past few months, though, we’ve seen a notable shift in the market, with demand for aircraft charters rising at an unprecedented rate. The recent vaccine rollout might have something to with this, inspiring confidence that a return to “business as usual” is imminent. For some individuals, the decision to fly private has become a priority for safety reasons, enabling them to fly with others in their immediate bubble and to avoid TSA lines, which are often poorly managed in regard to social distancing. For others, the decision to switch from flying commercial to private is a matter of comfort and convenience.

Regardless as to why demand has spiked, more people are flying private than ever before, stretching resources thin. Private aircraft providers such as Flexjet, NetJets, Wheels Up and others have sold thousands of jet cards over the past year — and with only approximately 5,000 charter aircraft in the market today, demand has rapidly outpaced availability. Another important factor to note here is that the vast majority of this demand comes from leisure travel; it will only continue to skyrocket once normal business travel resumes.

Although charter providers are doing everything in their power to keep the charter market stable, travelers are already starting to feel the effects of this precipitous increase in demand. Card programs typically require members to give advance notice for both regular travel days and extended notice for peak travel days. In some select cases, providers have been unable to accommodate travelers’ needs even with required advance notice, disrupting schedules in the process.

Though travelers do have the option to expand their available field — for example, if a broker or operator were unable to source an aircraft in the New York area for a client, they might look outside that area for an available aircraft — this comes at an additional cost due to positioning flights. These capacity challenges are compounded around major holidays and events.

The current state of the market has led many jet card holders to ask themselves what it’s worth to be able to fly when and where they want to fly. And, given the fact that these availability constraints are unlikely to let up in the near term, this is a good time to explore the option of acquiring your own private aircraft.

Though some potential buyers might be reticent, hoping that aircraft values will drop if they just hold out a little bit longer, the reality is that values are not expected to decrease any time soon, beyond normal depreciation. In fact, the rise in demand in the charter market combined, as well as more recent supply challenges for quality charter aircraft, has motivated more frequent travelers to explore actual ownership. While actual ownership makes sense when one’s travel needs reach a certain level, the benefits of bypassing peak travel schedules and having access to your own aircraft and crew are certainly appealing.

For those interested in learning more about their private aviation options, and whether transitioning from charter to acquisition makes the most sense for their specific travel requirements, Essex Aviation is here to help. With a combined 100+ years of aviation experience and a vast network of industry connections, we offer a unique lens into what’s happening in the market today and identify the right aircraft based on your particular needs.

Contact us today to find out what Essex Aviation can do for you.

Ask These Questions Before Making Your Next Aviation Decision

Private aviation offers numerous benefits, but each service option comes with its pros and cons. Find out whether a membership/card program, charter, fractional or dedicated aircraft model is right for you — and how a private aviation consultant can help you make an informed decision — in this free eBook.