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[lbo] 27/3/2010 21:37

JetBird cancels deal for 50 corporate jets



DUBLIN-BASED executive jet airline JetBird has cancelled its contract with Brazilian manufacturer Embraer for 50 Phenom 100 very light jets

[lbo] 03/2/2009 11:46

Business-Jet Demand Is Stalling

[lbo] 03/2/2009 11:26

Flexjet 25 Jet Card Program Introduces Enhanced Payment and Aircraft Selection Options

[lbo] 27/11/2008 20:20

Volume issue hovers over air taxi start-ups


The concept of air taxis has not got off to a flying start. The US service that had the biggest ambitions, DayJet of Florida, had those lofty plans brought crashing down to earth by the credit crunch and delays in aircraft deliveries. Of the 1,400 Eclipse 500 very light jets (VLJs) it envisaged operating, the 28 it actually received are now being sold on by the manufacturer.

In western Europe, conditions are different. While roads are more congested, there are more options for point-to-point travel, including fast rail services. And some, including the body responsible for air traffic control in Europe, fear the system will not be able to cope with sizeable fleets of four-passenger, twin-turbofan air taxis.

Meanwhile, the rapid deterioration in the financial climate has put a squeeze on conspicuous consumption of private aviation services. One large operator calls the current sudden slowing in business jet traffic a "pregnant pause".

But others say the situation demands that companies pursue opportunities more aggressively, and focus more clearly on choosing travel options that are efficient not just in cost but also in time.

There is also evidence owners of large business jets are willing to slum it in an air taxi for shorter hops, because the cost is more easy to justify. In addition, commercial airline schedules do not often lend themselves to multi-sector trips in a single day.

Blink, one of the first European start-ups to use the air taxi model, is confident. It says its decision to go with a per-plane hire basis, rather than the per-seat model that DayJet was so confident would succeed, gives it an edge. But at the same time that model puts it close to the traditional private charter.

Where the two models differ is that the air taxi start-ups hope to offer lower prices by achieving higher utilisation rates of their expensive assets - the aircraft. Established charter companies expect to have their aircraft flying for about 400 hours a year. Blink is aiming at more like 800.

The Farnborough-based company started operations in June, and has been operating with only one aircraft since. "It's still very early," says Peter Leiman, Blink managing director. "With one plane we can't draw any definitive conclusions. But, that being said, in September we achieved a utilisation rate that on an annualised basis would be 840 hours a year."

Blink has opted for a single plane from an established manufacturer - the four-passenger Citation Mustang, from Kansas-based Cessna. There have been none of the delays and technical issues that still afflict the Eclipse, the aircraft that the now-defunct DayJet chose, according to Mr Leiman.

Two additional Mustangs arrive this month, then on average one more a month will be added to the fleet over the next two years.

The Phenom 100, another new aircraft from an established manufacturer, has been chosen by JetBird, which plans to launch next year from Germany. It has 56 firm orders and 44 options for the four-passenger Phenom, made by Embraer of Brazil. JetBird expects its first aircraft in April with, on average, two more a month to 2013.

Stefan Vilner, JetBird chief executive, is unfazed by the current economic woes. "The timing for us is quite an opportunity," he says. "We are going to launch quietly in 2Q 2009. If the cycle follows the usual trends in the world, we'll be launching in the upcycle."

According to Domhnal Slattery, JetBird founder: "From an equity perspective, the balance sheet is very healthy. We completed all of our equity financing before the dislocation in the markets."

Financing for the start-up phase is key. "Forty to 50 aircraft are required for economies of scale," says Mr Slattery. "We assume we'll get to critical mass in 2011."

Mr Leiman says signs support the idea that air taxis could expand the whole market. "Some 60 per cent of our customers are private-jet-down users," he says. "But 40 per cent are new to private aviation."

Some analysts are not convinced. "The last time I looked you need utilisation rates of at least 1,000 hours a year," says Chris Tarry, who runs aviation consultancy CTAIRA. The arguments for air taxis, he says, "clearly have merit. But are they going to have the volume?"

[lbo] 27/11/2008 20:12

Eclipse Aviation files for Chapter 11
By Kevin Done, Aerospace Correspondent


Published: November 26 2008

Eclipse Aviation, the troubled US pioneer maker of very light, 3-4 passenger corporate jets, collapsed into court-administered chapter 11 bankruptcy on Tuesday.

It said it was seeking court approval for an expedited sale of most its assets as a going concern under the so-called section 363 of the US bankruptcy code. It was likely to lead to a public, competitive auction for much of the business, if the process was sanctioned by the court.

The demise of Eclipse comes as the global business aviation industry faces growing problems, with new orders shrinking and buyers facing increasing difficulties in securing financing for new jet purchases. Inventories of used jets are growing and corporate and private flyers are reducing activity.

Cessna, a division of Textron of the US and the biggest maker of light and mid-sized corporate jets, said earlier this month it was cutting its planned production for 2009 by more than 10 per cent. Hawker Beechcraft, the former Raytheon Aircraft business that was sold last year to Onex Partners and Goldman Sachs Capital Partners, said it was cutting production and was removing around 500 jobs or 5 per cent of its 10,000 workforce.

Jim Schuster, Hawker chief executive, warned of the "very serious challenges" facing the group "due to the "unprecedented worldwide economic decline". Shrinking wealth and the shortage of available credit were directly affecting customers' ability to purchase new aircraft.

Eclipse has been dogged by protracted production and technology problems as it has struggled to find fresh sources of finance. Court documents show it owes more than $1bn.

In parallel with the bankruptcy filing the company said it had reached an agreement for the sale of its assets for a "combination of cash, equity and debt" to an affiliate of Luxembourg-incorporated ETIRC Aviation, its largest shareholder with 65 per cent of the equity.

The proposed sale would be subject to competitive bidding through a public auction and was expected to be completed in January, if approved by the court under the section 363 procedure, the company said.

Roel Pieper, chairman of ETIRC, has been chairman of Eclipse since January and took over as acting chief executive in July, when Vern Raburn, the founder of Eclipse and the man regarded in the aerospace industry as the pioneer of the new category of very light jets, was ousted from the group.

The Luxembourg-registered investment fund led by Mr Pieper, a Dutch, former IT industry executive, led the previous rescue effort at the start of the year, when it emerged as the leading shareholder.

Mr Pieper said last week in an interview with the Financial Times that ETIRC had invested more than $175m in three tranches between last December and July.

ETIRC has been planning to transfer some assembly of the Eclipse jets to a new facility to be built in Russia. It said in September Vnesheconombank (VEB), the Russian state bank, had approved construction of a plant in Ulyanovsk to assemble the Eclipse 500.

The group was forced to cut its employee numbers by 38 per cent in August with the loss of 650 jobs leaving a workforce of 1,100 and numbers have since dwindled to around 950, as the financial problems have grown.

The development of Eclipse has generated enormous publicity for the launch of very light jets, which some analysts believe will transform the cheaper end of the business jet market.

The new ranges of VLJs, which have started coming into the market in the past two years, are being used to create new business models for so-called air taxi operators, but this sector has also run into severe problems in the US.

In September DayJet, the biggest customer of Eclipse, collapsed into bankruptcy.

DayJet was the world's first operator of a "per-seat, on-demand" private jet service, but it was forced to cease operations when it failed to secure fresh finance. It had taken delivery of 28 Eclipse jets of an initial order of around 300 and said it had been "plagued by three years of delayed aircraft deliveries" from the company.

Mr Pieper said last week the group had produced around 275 jets since deliveries started at the beginning of 2007.

Eclipse said on Tuesday a "group of existing Eclipse shareholders and note holders" would provide debtor-in-possession financing, once the bankruptcy petition was approved by the court. This would provide "sufficient resources to continue normal business operations" until a sale of the assets could be agreed."

Court documents show it plans to borrow as much as $20m from ETIRC and the Alfred E. Mann Living Trust.

[lbo] 22/10/2008 14:01

Private jet operator to file for administration


European Business Jets, a UK private jet operator, decided on Tuesday night to file for administration after running out of funding in an early sign of the tightening market for private jet travel.

The group, which was listed on London's alternative investment market, was forced to suspend its shares three weeks ago after failing to file its annual results within the six-month deadline allowed under Aim rules.

Graeme Deary, chief executive and largest shareholder with a stake of 19 per cent, said on Tuesday night the group could no longer meet its obligations and had decided that Barclays, its main bank which is owed about £650,000 ($1m), should appoint receivers on Wednesday.

EBJ was floated in April 2005, when it raised £1.8m. It offered the fractional ownership of private jets as well as a jet card membership scheme and aircraft management services. It was operating a fleet of eight private jets capable of carrying between five and nine passengers.

The Cessna Citation light jets comprised five aircraft which were privately owned and managed by EBJ and three of which were owned by limited liability partnerships.

Mr Deary, a former executive of NetJets, the biggest European private jet operator, said the demand for fractional ownership had declined significantly this year although the sale of blocks of flying hours through its jet card membership scheme had remained strong.

The group's finances had deteriorated sharply since its shares had been suspended, however, and suppliers, including oil companies, airports and air traffic control providers had been insisting on immediate cash payment for services.

The group's problems had been intensified by the decision by its auditors Baker Tilley just before the filing deadline that its accounts should be prepared on a consolidated basis to include the limited liability partnerships, which controlled the three fractionally owned jets.

It had been impossible to produce the accounts before the group's funds had run out.

[lbo] 01/9/2008 17:05

Results will be soon. I doubt they will be good. Could be the end soon for those that could not even make a profit in the boom. What chance in a recession!

Charter Business Remains Strong Despite Recession Says Virgin Charter's Duffy

[lbo] 14/8/2008 09:17

Air Partner sees FY ahead of expectations. Seems to be a safer bet in the sector. If such a thing exists.

[lbo] 23/7/2008 17:05

Sky's the Limit for European Sales

[lbo] 16/7/2008 15:42

AIR SHOW: Cessna's Business Jet Order Backlog Still Growing



"Surging demand from outside the firm's core U.S. market, notably to Europe"

[lbo] 11/7/2008 11:33

Mr Rooney buying more shares. I supect things are tough

[lbo] 07/7/2008 10:41

Air partner fell aswell. Then again all stocks have fallen!

[nigthepig] 04/7/2008 08:46

A rapid drop of almost 23% in a couple of minutes this morning.
mmmmm

[lbo] 03/7/2008 22:07

Business jets boom as rich float above oil crisis




Airline Troubles Means More Demand for Private Jets

[lbo] 29/5/2008 13:48

Private jet sales soar sky-high

The credit crunch, market jitters, a global banking crisis - it seems all are of no concern to the super rich, who are busy buying luxury aircraft in greater numbers than ever

[lbo] 28/5/2008 10:11

Comparing the Eclipse and the Cessna is David Savile, chief executive of the world's largest charter broker, Air Partner. "The Eclipse has just three seats and that limits its attractiveness compared to the larger Mustang," he says, adding that he dislikes the 'taxi' comparison as having more to do with marketing than reality. Yet on the subject of the economic outlook for the whole private aviation sector, Savile is bullish. "It's crazy," he observes. "The world's in recession but everyone's flying private jets." Air Partner's half-year results for the period ending 31 January, showed a 20% increase in new clients and record profits.