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Holiday green shoots

Submitted by Paul Maurer on Wednesday, 01/05/2011 - 05:10

Happy holidays! I hope you are enjoying a festive and relaxing week. Unfortunately, ‘festive’ and ‘relaxing’ are not words often associated with air travel this time of year. Increasingly invasive security measures, the holiday onslaught of leisure travelers, and unpredictable weather this time of year challenges even the most patient business travelers.

While travelers are increasingly resigning themselves to such hassles, they also seek ways to gain convenience and time savings. In fact, a recent Orbitz for Business survey revealed that top five most used airline ancillary services are all convenience and flexibility related, as opposed to baggage check related which usually garners most of the attention (and the $7.8B in 2009 ancillary revenue). Furthermore, there is continued pressure by business travel industry groups to reinstate a ‘trusted traveler’ program. They estimate that business travelers would take 2-3 more trips per year if hassles could be reduced.

The bright side of these airline travel hassles appears to be benefiting the business aviation industry. While November 2010 business flight activity was up a nominal 6.3% vs. last year, there have been anecdotal reports of a December surge in demand due to weather and airport chaos.

While holiday related upticks in business aviation demand is certainly positive (industry trade group NATA’s President stressed in his end of year message that “there’s nothing more important for general aviation than to increase flight activity”), high business aviation prices continue to be a major deterrent. Fortunately, there were a few developments this month that bode well for the future of lower priced alternatives.

The HondaJet completed its first official flight (though deliveries won’t start until 2012), JetSuite expanded its low cost Phenom 100 service to 4 Texas cities, and Executive AirShares launched an innovative simultaneous usage option for its fractional customers. As well, Eclipse Aerospace continues to show promising signs of a turn-around.

With air travel decisions, it’s typically a time saving vs. cost calculation. If a few December airline hassles (causing lengthened average trip time) can shift a little demand to business aviation, just think what a lower cost business aviation alternative could do.

(Excerpted from the December, 2010, igojet e-newsletter. To receive future e-newsletters directly to your Inbox, please click here and sign up)

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