Flexing Its Muscle

  • Photo by Paul Bowen
    Global 5000 Photo by Paul Bowen
  • Photo by Paul Bowen
    Bombardier Challenger 605 now belongs to Directional Aviation Photo by Paul Bowen
  • Photo by Paul Bowen
    Bombardier Challenger 605 now belongs to Directional Aviation Photo by Paul Bowen
  • Embraer Phenom 3000
  • Photo by Paul Bowen
    NetJets has recently added New Global 6000 Jets to its fleet. Photo by Paul Bowen
  • Photo by Paul Bowen
    NetJets has recently added New Global 6000 Jets to its fleet. Photo by Paul Bowen
  • VistaJet plans to add 10 Bombardier Challenger 350s to its fleet this year.
  • VistaJet plans to add 10 Bombardier Challenger 350s to its fleet this year.
  • Sentient Jet offers access to Meadowood Napa Valley
  • Sentient Jet offers access to Meadowood Napa Valley
  • Sentient Jet offers access to Meadowood Napa Valley
  • Photo by Chauncey Studios
    Sentient Jet offers access to the Cessna citation ten Photo by Chauncey Studios
  • Photo by Paul Bowen
  • Photo by Paul Bowen
  • Photo by Paul Bowen
  • Photo by Paul Bowen
  • Photo by Paul Bowen
  • Photo by Chauncey Studios
<< Back to Robb Report, October 2014
  • Shaun Tolson

The parent company of Flight Options acquires Bombardier’s fractional service.

The private-aviation industry as a whole seemingly has returned to prerecession form, but one segment was forever altered by the financial crash. “If any part of the industry has changed since 2009, when the market dropped, it’s the fractional world,” says Robb Report Private Aviation Advisory Board member Lee Rohde, the president and CEO of Essex Aviation Group, a consulting firm in Portsmouth, N.H. Among the more significant recent changes are CitationAir’s withdrawal from the fractional business, a pullback that began in 2012 when the firm stopped selling fractional shares, and Avantair’s shuttering and declaration of bankruptcy, which occurred last fall. What could be an even bigger shakeup took place in December of last year, when Directional Aviation Capital, the parent company of fractional-share and jet-card provider Flight Options (www.flightoptions.com), acquired Bombardier’s fractional service, Flexjet (www.flexjet.com). The deal left Flexjet’s fractional owners wondering how the company and its services may change.

Kenneth Ricci, Directional Aviation’s principal, says that Flexjet and Flight Options both plan to introduce revamped suites of services in October. “We think the market is divided into two categories, so we plan to position the brands toward those buyers,” he explains. “What I’ve seen in the aviation market is the same thing that we’ve seen demographically in the U.S.: We’ve lost the middle class. On one end of the market, we have people looking for great buys, and then we have the über rich who are buying large-cabin bespoke aircraft.” 

According to Ricci, Flexjet’s clientele comprises mainly large corporations with big budgets for private air travel. Conversely, Flight Options customers tend to be more concerned with finding the best values among the private-flight offerings. He says that going forward, each company’s offerings will better reflect its customer base. 

As for the recent downsizing in the fractional market—specifically the imminent shuttering of CitationAir’s fractional business and the folding of Avantair—Ricci sees it as part of a Darwinian process. “We’ve taken enough capacity out of the system that pricing has firmed, and we’ve become more rationalized,” he says. “In five or six years we’ve finally retooled to have the right supply for the demand that’s out there.”

Ricci’s optimism is reflected in Directional Aviation’s plans to continue expanding. He says that the company is aggressively pursuing other lean and profitable private-aviation companies. “I don’t think I’ll see another opportunity like this in a long time,” he says. “We feel like this is the time to strike. We won’t get them all right, but we’re working on a lot of deals. We have more letters of intent out there than we ever have before.”

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