about flying on the airlines. Well, that’s starting to wane. People are getting back to normalcy.” He’s not wrong. WingX, the data-tracking company that offers insights on business aviation flight activity, reported in June and July that activity was down as much as 10 percent compared to last year but is at least 18 to 20 percent better than in 2019. “People have exhausted their desire to travel and to be in multiple locations,” Waguespack says. He points out that now that people have worked that out of “their system,” they are more inclined to cut back. That also explains why some companies have gone belly-up, in his view. “Here we are looking at companies that are failing. Their business models were not set up on necessarily a strong foundation, and they weren’t able to quickly adapt to changing market conditions,” says Waguespack before listing off the litany of reasons that have hampered growth. Waguespack isn’t alone here. BusinessAIR also spoke with Michael Riegel, a veteran in the industry who has worked stints at Bombardier and Flexjet as vice president in various roles and is now a marketing consultant for AviationIQ—and who has built up a reputation for being an outspoken critic of some In May, FLYING Media Group CEO Craig Fuller reported that fractional and charter company Jet It was on the cusp of going out of business, leaving customers like himself and others to scramble to find a new home for their aircraft. Jet It’s CEO said the company was taking cautionary measures because of safety issues it claimed were related to the HondaJet fleet. Still, FLYING disputed that assertion and offered that the Greensboro, North Carolina, company just didn’t have a good business model. “Their failure was an inevitability, and when I look at other fractional providers, the same will happen,” Riegel says. “They simply aren’t charging enough money.” players in the industry. IS THE SKY FALLING? For things to have worked for Jet It, Riegel argues that “you need a business model that is guaranteed to lose tens or even hundreds of millions of dollars while you become established.” Using NetJets and Flexjet, the juggernauts of the fractional and charter industry, Riegel notes how much those operators had to spend to scale and streamline operations before they were profitable or, at best, broke even. “If you look at NetJets and Flexjet, they lose money or, at best, break even operating aircraft, and they make all of the profit they generate from buying and selling shares multiple times during what is typically about a 20-year life for the aircraft in fractional service,” Riegel Wheels Up announced it will receive $500 million from Delta Air Lines and Knighthead Capital Management, Certares Management, and others to stave off bankruptcy.
the result of the great reopening, that drove higher costs and forced higher wages? Or was it all a farce? Did we fly too close to the sun? “We’re coming off an epic high—the ultimate sugar rush that we’ve never seen before,” says Ryan Waguespack, a former executive vice president at the National Air Transportation Association and now a partner at Jetquity. Waguespack joined the international private investment firm last year and says one of the goals of his current company is to “look at different methods of creating marketing stability with the business aviation framework.” Coming off the news of the fallouts caused by companies like Jet It, Wheels Up, and AeroVanti, Waguespack reasons that some of the disruptions could be chalked up to the fact that the industry reached heights never achieved. “In business aviation, we’ve got a massive amount of people that flooded in due to fear and concern, due to COVID,” Waguespack says, “and they were concerned
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