business Archives - FLYING Magazine https://cms.flyingmag.com/tag/business/ The world's most widely read aviation magazine Fri, 20 Sep 2024 15:09:23 +0000 en-US hourly 1 https://wordpress.org/?v=6.6.1 Managing the Optics of Flying in a Corporate Aircraft https://www.flyingmag.com/sponsored/managing-the-optics-of-flying-in-a-corporate-aircraft/ Fri, 20 Sep 2024 15:09:20 +0000 https://www.flyingmag.com/?p=218055&preview=1 Uncover the economic and intangible benefits of business aviation.

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BROUGHT TO YOU BY FLYING FINANCE

If you or your company are in the market for a business aircraft, having decided that it’s a worthy investment for your travel needs, you may have one lingering concern: What’s the perception of flying in a private jet or small passenger aircraft? 

Optics, like any other facet of business, require thoughtful consideration, especially with some celebrities recently dealing with controversies over their use of private jets.

Depending on your industry and even the state of the economy, you might face questions from staff, clients, or public relations about why your executives need a business aircraft as opposed to flying commercial. 

We’ve put together a list of some common questions and some ways you can answer them:

Why do you need a private/corporate aircraft? Wouldn’t flying commercial cut costs?

The ownership and operation of aircraft has been calculated like any other business expense. Travel costs are evaluated and weighed against time constraints, agenda, and available commercial or charter options.

As with any company assets, accountants will review expenses, tax benefits, and depreciation to determine the costs and benefits. In the case of private aircraft, bonus depreciation legislation means that businesses are able to depreciate the asset swiftly, potentially resulting in additional free cash flow due to tax savings.

Is business aviation a perk for high-level executives?

Due to tight schedules and demanding responsibilities, many top-level executives spend much more time on company business than the standard 40 hours per work week.

On average, using a private or a corporate-owned aircraft saves roughly three hours door to door compared to traveling by commercial airliner. In this case, the costs of private aircraft are outweighed by time savings.

While access to a company aircraft can make the workload easier, it’s also a necessity for some corporate roles—and not necessarily limited to C-suite executives.

Do corporate aircraft aid in productivity?

Studies show that travel time is significantly more productive in corporate or private aircraft, including not only flight time, but entire time spent en route.

Executives are productive for roughly 80 percent of travel time while using business aviation versus 30 percent of time while flying a commercial airliner, which results in a net gain for shareholders. 

Typically, the higher up an executive is in an organization, the wider the geographic breadth of their responsibilities. That means, on average, CEOs and other C-suite professionals spend more than half of their time each week traveling on company business. These productivity figures become increasingly relevant in organizations that span national or international boundaries. 

Not to mention, there are several intangible productivity benefits of business aviation, including schedule flexibility, access to 10 times as many airports, and the confidentiality of private travel. All of these factors are taken into account when evaluating the need for operating a corporate aircraft.

Will a corporate aircraft be sold to cut costs in the case of layoffs?

The costs associated with business aviation are justified by the utility of the asset.

Business aircraft are not a luxury but a tool like any other part of operation. Just as selling laptops and telephones would not likely be a viable way to cut costs and prevent any potential layoffs, neither would selling an aircraft or related asset. 

That said, to the extent a physical location might be shut down and equipment sold off due to lack of utilization or other factors, an aircraft could be liquidated if the needs of the business change.

Are the security benefits of private aircraft necessary? 

Due to the sensitive nature of many high-level topics and business deals, executives often need privacy to discuss vital matters out of public earshot.

In cases of both strategic planning among team members and relationships with clients or partners, traveling together via business aviation can be an incredibly effective tool and double the productivity of scheduled travel time. 

Unfortunately, commercial airliners, public airports, and accompanying ground transportation can also be sources of security risk for high-profile individuals, particularly executives and potential clients. Flying from a controlled environment such as a privately owned or leased hangar facility greatly simplifies the logistics of travel security.  

If you haven’t yet determined if buying or financing a private plane is right for you, check out the investment benefits of financing your aircraft and reach out to FLYING Finance. Our team of experts can walk you through the entire process of budgeting and accounting for the expenses of operating any type of aircraft.

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Honeywell Releases 2023 Business Aviation Market Forecast https://www.flyingmag.com/honeywell-releases-2023-business-aviation-market-forecast/ Mon, 16 Oct 2023 06:42:13 +0000 https://www.flyingmag.com/?p=185101 The OEM projects that 8,500 new business jets, worth about $278 billion, will be delivered during the next ten years.

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During its annual market report announcement on Sunday, Honeywell Aerospace has projected that 8,500 new business jets, worth about $278 billion, will be delivered during the next ten years—so says Javier Jimenez-Serrano, the firm’s strategy innovation manager. While the forecast remains unchanged from 2022, the total value of the new fleet has increased due to inflation and increasing list prices. Deliveries in 2024 will be 10 percent greater than in 2023 and sales revenue will increase 13 percent.

New business aircraft operators account for 500 of the sales from 2024 to 2033, increasing fleet
utilization by about 6 percent. Nineteen percent of existing business jet operators say that they will replace or add aircraft in their fleets in the next five years, accounting for more than 4,000 new aircraft deliveries.This is almost three times the replacement rate operators planned from 2010 to 2020. The purchasing expectation expectation also is 2 points higher than in 2022, reflecting operators’ optimism about the state of the industry and world economy. Almost two-thirds of respondents say they will fly as much in 2024 as they did in 2023. Twenty-nine percent say they will fly more hours next year. The overall size of the fleet will grow by 3 percent, according to Honeywell.

During the next five years, 64 percent of new aircraft will be delivered to North American customers, 14 percent to European operators and 11 percent to Asia-Pacific. Deliveries to the Middle East and Africa increase to 6 percent, but Latin America declines to 5 percent of global deliveries.

Jimenez-Serrano says that while fractional aircraft operators are not part of the survey, inputs from Part 91K operators, among other sources, help bolster the accuracy of the forecast. Sample size this year was a scant 100 operators, down from more than 1,500 in previous years. However, the Honeywell data closely parallels the projections of Rolland Vincent Associates of Plano, Texas, long considered one of the most credible market research firms in the business aviation industry. Jimenez-Serrano concedes that sampling error could approach +/-5 percent with only 100 respondents.

Working Through Backlogs, Supply Chain Recovery

The next three years will witness a strong surge in deliveries, as the supply chain fully recovers from the COVID slump and OEMs work off order backlogs. OEMs missed 350 deliveries from 2020 to 2022 because of COVID-induced supply chain snags. Deliveries plateau somewhat in 2028 and 2029 before slowly increasing to 930 deliveries in 2022. Jimenez-Serrano notes that total estimated deliveries during the next decade will be the highest in nearly a decade.

Midsize and super-midsize aircraft deliveries should increase about 15 percent in 2024. Long term, large cabin and ultra-long range aircraft deliveries, while only representing about 10 percent of the total, account for 69 percent of the sales revenues during the next five years. Jimenez-Serrano notes that Gulfstream’s GVII series, G400, G500 and G600, plus the Dassault Falcon 6X in the large cabin class, along with the Bombardier Global 7500/8000, Dassault Falcon 10X, and Gulfstream G700/G800, are well positioned to capitalize on this surge.

Honeywell’s Take on Sustainability

Sustainability increasingly is on the minds of business aircraft operators, with two-thirds of respondents saying they plan to embrace or increase efforts to reduce emissions. Current steps include flying fewer missions and using the airlines in lieu of their own business jets. Only 12 percent presently use biojet. Longer term, 39 percent say they plan to use sustainable aviation fuel (SAF) and another 28 percent will buy carbon offset credits.

But, jet fuel suppliers have been slow to increase production of SAF to meet a sharp increase in demand from both business aircraft operators and the airlines. The civil jet industry consumes nearly 100-billion gallons per year and SAF production amounts to only 100-million gallons. David Shilliday, vice president and general manager of Honeywell Power Systems, believes that the industry can boost output to 10-billion gallons per year by 2030, using existing refineries and feed stocks. If the industry is going to make the transition to 100 percent SAF by 2050, Shilliday believes that major U.S. federal government investment will be needed to help jet fuel suppliers achieve that goal. Without government aid, it’s unlikely that large scale increases in feedstock supply, SAF production and cost-per-gallon affordability can be achieved.

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Dassault Plans New Customer-Focused Display for NBAA-BACE https://www.flyingmag.com/dassault-plans-new-customer-focused-display-for-nbaa-bace/ Thu, 12 Oct 2023 17:02:02 +0000 https://www.flyingmag.com/?p=184890 The French company will consolidate its activities at the show to provide a ‘one-stop shop’ for visitors.

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Dassault Aviation said it will consolidate its activities in the static display area at Las Vegas’ Henderson Executive Airport (KHND) during the upcoming NBAA Business Aviation Convention & Exhibition. This first-time arrangement is meant to improve the customer experience by providing a one-stop shop.

The new display will feature a larger, redesigned chalet that will permit customers and guests to stay informed about the latest Dessault news and meet with sales, customer support, and MRO network representatives in the same place. The French company’s best-selling Falcon 2000LXS twin and Falcon 8X ultralong-range trijet will be part of the static display.

The 2000LXS has a widebody cabin designed to accommodate as many as 10 passengers comfortably. The aircraft can cover a range of 4,000 nm and is known for its short-field performance. Its “combination of comfort and economical, go-anywhere performance” has helped Dassault sell nearly 700 aircraft to date, the company said.

The Falcon 8X has a 6,450 nm range and recently received an upgrade to the EASy IV flight deck from Honeywell that provides improved capability and safety features. The 8X was also approved for Dassault’s advanced, dual heads-up display, which improves situational awareness and allows both pilots to share the same view. The HUD feature is also available as a retrofit for operational 8X aircraft.

Dassault will also display a full-scale flight deck and cabin mock-up of the new ultralong-range, ultra-widebody Falcon 10X twin in development. The 10X will be powered by Rolls-Royce Pearl 10X engines capable of running on 100 percent sustainable aviation fuel. Dassault said the 10X will be the largest purpose-built business jet on the market and will have a range of 7,500 nm.

People attending the show will also be able to try a new Dassault flight app called FalconWays, which uses wind data from around the world to help pilots plan routes that save fuel and time while lowering emissions. The company said it will roll out the app on the new Falcon 6X twin when it enters service.

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Wheels Up to Continue Operations After Closing Transaction with Delta, Other Investors https://www.flyingmag.com/wheels-up-to-continue-operations-after-closing-transaction-with-delta-other-investors/ Thu, 21 Sep 2023 21:58:09 +0000 https://www.flyingmag.com/?p=180660 Deal will give lenders 95 percent stake in the company and control of the board.

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Wheels Up Experience (NYSE: UP) said it has closed the previously announced investment by Delta Air Lines, Certares Management LLC, Knighthead Capital Management LLC, and Cox Enterprises.

The investment agreement, which includes a $500 million credit facility to Wheels Up, combines the experience of Delta, the travel and tourism expertise of Certares, and the turnaround and restructuring knowledge of Knighthead. The announcement follows the selection last week of George Mattson as the new Wheels Up CEO.

“This investment represents both an important source of capital for Wheels Up to support our strategy for financial stability, future profitability, and long-term growth on behalf of our members and customers, as well as a vote of confidence in our path forward from a group of investors with deep experience in the premium travel space,” Mattson said. “We look forward to working closely with Delta and our other investors to deliver best-in-class operating performance and an exceptional customer experience which, as we deepen our commercial partnership, will also enable us to provide a one-of-a-kind, seamless connection between private and premium commercial travel.”

The credit facility includes a $350 million term loan funded at closing from Delta, CK Wheels LLC, and Cox, and a $100 million revolving credit facility from Delta. Under terms of the credit agreement, a new lender may provide a $50 million term loan after the closing date, as approved by Delta, Certares, Knighthead, and Cox. The companies said they expect to complete a transaction for the additional funding “in the near term.”

“Wheels Up is an integral part of Delta’s portfolio of premium partners, and this deep relationship offers a significant opportunity to deliver compelling benefits to our customers that are unique in the travel space,” said Dan Janki, Wheels Up chairman and Delta’s chief financial officer. “This investment and new leadership puts Wheels Up on a strong path to future success.”

WIth the closing of the credit facility, the lenders will receive newly issued shares of Wheels Up common stock representing 80 percent of the company’s outstanding equity at the time of the closing. After approval by Wheels Up’s shareholders, the company will issue additional new shares to the lenders, who ultimately will own 95 percent of its outstanding equity as of the closing, the companies said.

Wheels Up also announced a new structure for its board, under which Delta will appoint four directors, Certares and Knighthead each will appoint two, and Cox will appoint one. One Wheels Up executive will join the board, and two independent directors are expected to remain from the previous board, the companies said.

A number of strategic advisors assisted with the transaction, including Davis Polk, Jefferies LLC, Kirkland & Ellis, and PJT Partners. 

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Embraer, FlightSafety Announce New Praetor Simulators in Florida, Europe https://www.flyingmag.com/embraer-flightsafety-announce-new-praetor-simulators-in-florida-europe/ Wed, 20 Sep 2023 18:18:11 +0000 https://www.flyingmag.com/?p=180582 The new training devices are part of a plan to bring the company and its customers closer together.

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Embraer and FlightSafety International have announced the opening of a new full-flight simulator in Orlando, Florida, to train pilots of the Brazilian company’s Praetor jets.

The companies said the FAA has qualified the simulator, and initial training for customers is available this month. Recurrent training is scheduled to begin in October.

Embraer and FlightSafety also said another Praetor simulator, the fourth to be fielded, will be based in Europe at a location to be announced later. The companies plan to begin operating that simulator by the end of 2024.

“Offering additional training capacity is important for supporting our customers,” said Carlos Naufel, president and CEO of Embraer services and support. “These two new full-flight simulators bring us even closer to Praetor family pilots and operators in the United States and Europe and will provide us with the opportunity to share our latest technological updates and best-in-class support.,” said Carlos Naufel, president and CEO of Embraer services and support.

Said Nate Speiser, executive vice president of FlightSafety sales and marketing: “FlightSafety is committed to addressing the increasing demand for Embraer Praetor training. ,” said Nate Speiser, executive vice president of FlightSafety sales and marketing. “As Embraer’s training partner, we are proud to announce consecutive simulator deployments in two regions to support the worldwide training demand for this quickly growing fleet.”

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Wheels Up Selects George Mattson as New CEO https://www.flyingmag.com/wheels-up-selects-george-mattson-as-new-ceo/ https://www.flyingmag.com/wheels-up-selects-george-mattson-as-new-ceo/#comments Thu, 14 Sep 2023 17:43:29 +0000 https://www.flyingmag.com/?p=180026 He brings 25 years of aviation experience to replace the departed company founder in the role.

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Private on-demand jet charter company Wheels Up announced that George Mattson has been named as the company’s new CEO. 

The news is the latest leadership change for the company that last month received $500 million in an emergency bailout from Delta Air Lines and other investors that saved it from bankruptcy. The company’s founder, Kenny Dichter, stepped down as CEO in May.

Wheels Up Experience Inc. (NYSE: UP) was founded in 2013 as a private jet travel company. According to Wheels Up, Mattson brings 25 years of aviation experience to the role, as a strategic adviser, financier, business owner/operator, and director. His previous roles included a place on Delta’s board of directors. 

“In 10 years Wheels Up has grown from a startup into a global leader in private aviation, with a strong consumer brand and loyal member community,” Mattson said. “I look forward to leading the Wheels Up team, with the operational, commercial, strategic, and financial support of Delta and our other new investors. Delivering best-in-class operating performance and exceptional customer experiences, consistently and profitably, will attract more members to our community as we begin the next chapter of the Wheels Up story.”

According to a press release, Mattson served as a partner and co-head of the Global Industrials Group in Investment Banking at Goldman Sachs. from 2002 to 2012. At the time, his responsibilities included oversight of the transportation and airline practices. 

Since 2014, he has been the lead investor and chairman of Tropic Ocean Airways, the nation’s second-largest operator of seaplanes. Tropic Ocean Airways is a Wheels Up partner.

Mattson will be based in Atlanta, where Wheels Up recently established a state-of-the-art member operations center. He will start the new job in October.

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Survey: Business Aviation Pilot Salaries Up 12 Percent https://www.flyingmag.com/business-aviation-pilot-salaries-up-12-percent-survey/ Tue, 12 Sep 2023 21:54:15 +0000 https://www.flyingmag.com/?p=179918 The NBAA survey also found that retention bonuses for senior captains averaged $27,000.

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Editor’s Note: This article first appeared on AVweb.com.

The National Business Aviation Association (NBAA) says business aviation pilots saw average pay raises of about 12 percent in the last year. 

The association’s annual compensation survey also found that the average salary increase across all positions was 7.22 percent. 

Dr. Christopher Broyhill, who helped conduct the survey, said it confirms industry scuttlebutt. “We’re hearing a lot of anecdotal stuff about pay raises out there and people getting more money for these positions, but that pretty much anchors it, shows that what we’re hearing is true.”

The survey took a deeper dive into various forms of pilot compensation and discovered that retention bonuses for senior captains averaged $27,000. 

Broyhill said business pilots have the airline pilot shortage to thank for their fatter wallets. “We’re seeing the results of airline pressure on wages in our industry because people are having to pay pilots more to keep them from leaving and going to the airlines or going to other operators who lose people to the airlines,” Broyhill said.

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Aerox Aviation Oxygen Systems Acquires Fluid Power Inc. https://www.flyingmag.com/aerox-aviation-oxygen-systems-acquires-fluid-power-inc/ Tue, 05 Sep 2023 21:12:34 +0000 https://www.flyingmag.com/?p=178937 Transaction helps the companies expand product offerings and move into new markets.

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O2 Aero Acquisitions, the parent company of Aerox Aviation Oxygen Systems, said it has acquired Fluid Power Inc., a longtime manufacturer of aviation oxygen systems and related components for military use.

Aerox said the addition broadens its line of aviation oxygen systems while expanding its global customer base.

“Our acquisition of Fluid Power will create a balanced military and civil aviation product portfolio and will provide greater manufacturing capacity and engineering expertise,” said Scott Ashton, O2 Aero managing director and Aerox president. “Fluid Power has a 75-year legacy of servicing the aviation industry, providing sophisticated oxygen equipment as far back as the Korean War, and today provides many oxygen components for military applications.”

Aerox said the two companies’ product lines are complementary and will allow them to serve more segments of the aviation oxygen market. Under terms of the acquisition, Fluid Power will continue to operate as an independent company as part of the O2 Aero Acquisitions portfolio. The company will be rebranded as Aerox Fluid Power.

The acquisition of Fluid Power, which closed on August 31, marked the third such transaction for O2 Aero Acquisitions after the purchase of Aerox Aviation Oxygen Systems in 2020 and Sky-Ox Aviation Oxygen in 2022.

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Delta, Others Invest $500M in Wheels Up Bailout https://www.flyingmag.com/delta-others-invest-500m-in-wheels-up-bail-out/ https://www.flyingmag.com/delta-others-invest-500m-in-wheels-up-bail-out/#comments Tue, 15 Aug 2023 17:18:04 +0000 https://www.flyingmag.com/?p=177502 Short-term capital infusion is expected to help cash-strapped, on-demand private aviation firm avoid bankruptcy.

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On-demand private aviation company Wheels Up is expected to be bailed out by Delta Air Lines and other investors.

Per a press release viewed by FLYING, the New York City-based company, which last week sought and received $15 million in emergency funding from the airline, will cede 95 percent ownership in exchange for a $500 million capital infusion from Delta, Knighthead Capital Management, Certares Management, and others.

The raise will save Wheels Up—plus the 11,639 active members who would have become unsecured creditors—from bankruptcy, which it said Monday it was considering as a “strategic alternative.” But the company’s survival, and potentially that of the industry, will come at the cost of equity.

“If a brand as important as Wheels Up were to fail, it would have had trickle-down impacts across private aviation,” Lance Tweden, vice president of membership for private aviation firm Jet Agency, told FLYING. “Wheels Up’s failure would have caused concern and anxiety among customers, whether they are with Wheels Up or not.”

The nonbinding agreement comprises a $400 million term loan (including $150 million from Delta) coupled to a $100 million liquidity facility from the airline. Delta and other investors will in turn receive newly issued Wheels Up Class A common stock representing the lion’s share of the company.

Ironically, Delta once owned Wheels Up’s private jet management business in full—it sold its Private Jets unit to the startup in 2020 in exchange for a 20 percent stake. The business changed hands again last week, when Wheels Up sold it to Airshare for an undisclosed fee.

“The partnership will create new opportunities for Wheels Up to drive strategic, operational, and financial improvements for its customers in the months and years ahead,” said Delta CEO Ed Bastian. “Delta’s unmatched expertise in premium travel, customer loyalty, corporate sales, operational reliability, and aircraft maintenance, combined with Certares’ and Knighthead’s experience and global reach, are expected to speed Wheels Up on its path to profitability.”

Wheels Up CFO Todd Smith will continue to serve as the firm’s interim CEO, while Delta CFO Dan Janki is replacing Wheels Up chairman Ravi Thakran.

“Over the past few months, we have been intensely focused on taking clear steps to improve our product offering and our operational delivery,” said Smith. “Those actions are already showing results, and we look forward to continuing and accelerating that progress with the support of our new partners. Our continued close work with the Delta team will enable us to further integrate our digital experiences, member benefits, and our operations.”

Similar to on-demand rideshare services such as Uber and Lyft, the private aviation business has struggled to reach profitability while burning through cash. Since filing for an initial public offering in 2021, it has consistently posted quarterly net losses. In the second quarter, that net loss widened to $160 million, a 73 percent increase year over year.

Wheels Up reported $152 million in cash on hand at the end of Q2, a fraction of the $586 million it had at the end of 2022 and even the $363 million reported in Q1. In that same period, adjusted earnings before taxes, interest, depreciation, and amortization (EBITDA) have held relatively flat.

The company’s woes could be in part because of its string of acquisitions over the past five years. Since 2019, it has added five different charter operators—Delta’s Private Jets, Mountain Aviation, Alante Air Charter, Gama Aviation Signature, and TMC Jets. But not all fly under the same certification, which limits its ability to reallocate crews across providers.

Wheels Up has also continued to add members and maintain certain policies—like its capped hourly rate—as its competitors have pulled back due to macroeconomic conditions. That’s driven more revenue for the company but at the expense of inflated operating costs.

For example, in the case of a mechanical issue, Wheels Up guarantees a replacement aircraft to the customer free of charge. That means if the charter rate rises between the time of booking and the mechanical issue, Wheels Up has to eat that cost. The issue can be exacerbated during stretches where demand is strong, as was the case with fractional jet ownership company Jet It, which folded in May.

The COVID-19 pandemic also had an impact on Wheels Up’s ability to crew flights. But on the flip side, the business likely would not be viable today had the pandemic not driven an uptick in private jet demand.

Luckily for new majority owner Delta, that volume is expected to be sticky. An eye-popping 93 percent of customers who began flying privately during the pandemic say they have continued to do so. The question now is what Delta and the other investors will do with that demand.

With the sale of its private jet management business, Wheels Up’s fleet is largely composed of King Air turboprops, Citation Xs and XLs, and Hawker 400 light business jets. Prior to the $500 million investment, the company was reportedly looking to grow its corporate business, its fastest-growing segment responsible for about one-quarter of all sales.

Currently, Wheels Up and Delta have an exclusive partnership through which customers can receive Delta benefits with a Wheels Up membership. Part of that arrangement focuses on business charter customers, which Delta could leverage to continue building out the more lucrative area of the business. However, Wheels Up’s membership program may require an overhaul to eliminate the issues that landed the company in a cash-strapped position in the first place.

“It will be interesting to see how they change the structure of the membership program going forward,” said Tweden. “There is no way it could be status quo.”

The new management team may also shed some of Wheels Up’s previous acquisitions to build stronger synergies. And Certares, which owns Internova Travel Group—ranked as the 11th largest U.S. travel agency with more than 100,000 advisers—could open new sales channels.

“Delta will likely make a lot of these changes quickly, as another challenge will be trying to maintain [Wheels Up] members that may be just now becoming aware of the precarious place the company is in,” said Tweden. “Despite this bailout, ultimately Wheels Up did fail, so how do they win that customer confidence back?”

Whether Delta is able to restore confidence in the Wheels Up brand or not, the latter’s struggles could have wide implications for private aviation as a whole. Given its size and high profile, rivals will likely look to the company as a case study of the industry’s challenges and how (or how not) to overcome them.

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Large Cabin Chasm https://www.flyingmag.com/large-cabin-chasm/ Tue, 01 Aug 2023 19:22:59 +0000 https://www.flyingmag.com/?p=176836 A gap in the 4,000 to 6,000 nm range prompts the question: Who will take advantage of this sweet spot?

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Editor’s note: This article was originally published in the April 2023 issue of Business AIR.

There are 30 purpose-built business jet models in current production, starting with $4.5 million, 1,000-nm-range light turbofan airplanes, all the way up to $85 million-plus, 8,000 nm-plus uber cruisers. Add in the $100 to $200 million air yachts from Airbus and Boeing, and the total count jumps to 36. The sheer number of these machines, along with notable differences in cabin comfort, speed, range, airport performance, and fuel economy, suggest there’s a perfect fit for every customer.

In reality, though, some segments have considerable overlap, while others are sparsely populated. There’s a long-term trend, for instance, by private jet manufacturers to migrate upmarket, expanding their product portfolios to include bigger, faster, and farther-flying airplanes. They’ve been moving up from 1,000-to 1,500-nm-range light jets into 1,500- to 2,000-nm mid-size business aircraft, then migrating from mid-size into 3,000-nm-plus super-midsize jets. Embraer, with its Praetor 500 and 600 jets, and Textron Aviation, with the Citation Latitude and Longitude, are two OEMs that have recently moved upmarket into super-midsize.

This has created hot competition in the super-midsize jet class. The super-mids were originally envisioned three decades ago as more economical alternatives to fuel-thirsty trans-continental-range Lockheed JetStars and Gulfstream GIIs.

Upmarket Climbs

The trend began in the early 1990s, when Israel Aircraft Industries (IAI) started design work on the first super-midsize jet, the Astra IV—an evolution of the IAI 1125 Astra light jet onto which IAI grafted a much larger-diameter fuselage. The Astra IV, indeed, was almost the same diameter as a GII. But the program was chronically underfunded, delaying development for several years.

Gulfstream G500 [Credit: Gulfstream]

A few years later, the Astra IV was branded as the Galaxy when the Pritzker organization infused money into its development. Gulfstream bought into the program in 2001, and the Galaxy was eventually rebranded as the G200.

Despite the Astra IV/Galaxy/G200 being the first in this class, its ongoing development woes, including several increases in girth, enabled Bombardier to seize the sales lead with its Challenger 300 (née Continental) in 2003. Learning lessons from Gulfstream, Bombardier endowed the Challenger 300 with a big wing and big engines, thus providing margins for weight gain.

Gulfstream, however, wasn’t about to cede the super-mid segment to Bombardier. Capitalizing on its partnership with IAI, it completely transformed the G200 into the G280 in 2012. The revamped aircraft has a considerably longer cabin, a new larger and higher-speed wing that holds more fuel, more powerful engines, a characteristic Gulfstream T-tail, and a fresh aircraft type certificate. But Bombardier’s nine-year lead enabled it to cement its position as the mid-size class leader. It now owns the largest share of this market with the Challenger 300, along with its updated, more capable, and more comfortable Challenger 350 and 3500 models.

Embraer’s Praetor 500 and 600, Textron’s Latitude and Longitude, and the G280 now vie for the rest of the pie. All the super-mids have two-section cabins, mostly with four chairs in club configuration in the forward and aft seating areas, accommodating eight passengers. Some models offer two-facing chairs and a three-place side-facing divan in the aft cabin in lieu of the four-chair club section. A few have four club chairs up front and six narrower chairs in the aft cabin.

These $20- to $30-million aircraft offer comfortable trans-continental U.S. range for 8 to 10 passengers. The newest versions can fly 3,400 nm to 3,900 nm, enabling them to cross oceans, as well. The longest-range models can fly Paris-to-New York non-stop missions that once were the exclusive province of spacious, large-cabin aircraft, with three seating sections providing ample passenger comfort for international flights. In contrast, a 9-hour trans-Atlantic trip in a two-section super-mid can be a physical endurance event for passengers.

The uppermost end of the private jet market is becoming increasingly crowded as business aviation’s three top titans, Bombardier, Dassault, and Gulfstream vie for building the biggest, fastest, and farthest-flying models, proportionately priced at $70 to $85 million.

The ultra-jet race started in 2008 when Gulfstream launched the 7,000-nm G650—larger, faster, and farther-flying than its predecessor, the G550. The G650 also cruised nearly 30 knots faster and 500 nm farther, plus it offered superior fuel efficiency at Mach 0.85 compared to the G550.

Speed Sells

When the G650 entered service in 2012, Gulfstream had racked up nearly 500 orders. Two years later, Gulfstream introduced the G650ER, featuring increased fuel capacity delivering 7,500 nm of range. Speed sells.

Bombardier countered the G650/G650ER in 2016 by introducing an even larger flagship, the 7,400-nm-range Global 7000, the largest purpose-built business aircraft ever launched. This giant offered a four-section cabin in place of the G650’s three-section cabin. Not to be outdone, Gulfstream countered by announcing the 7,500-nm-range G700, a stretched version of the G650 with four seating sections, plus a lower drag wing, more fuel-efficient engines, active sidestick controls, and an updated interior.

Bombardier’s Global 7000 proved to have 300 nm greater range than expected, so Montreal renamed it the Global 7500, and then launched the Global 8000,a close derivative with more fuel capacity, thereby increasing its range to 8,000 nm.

Gulfstream parried Bombardier’s Global 8000 thrust by creating the 8,000-nm-range G800, are placement for G650 that incorporates all the G700’s technical improvements to boost range by 500 nm. However, it retains the G650’s three-section cabin.

Bombardier Challenger 650 flight deck. [Credit: Bombardier]

Dassault remained conspicuously absent from this end of the market for more than a decade. Then, in mid-2021, it officially launched the Mach 0.85-cruise, 7,500-nm-range Falcon 10X, claiming the distinction of having the biggest cabin in the class, which is considerably larger in volume than either the Gulfstream G700 or Bombardier Global 7500/8000. It’s the first Falcon to be powered by Rolls-Royce engines, the first to sport a T-tail, and the first Falcon flagship in more than four decades to have two engines—not three.

The top-most jets in this class can cruise 8,000 nm, enabling them to fly from Singapore to San Diego, Boston to Bangkok, or Prestwick to Perth. Push up the speed to Mach 0.90, and some will still fly 7,000 nm, making city pairs such as Toronto to Taipei, Buenos Aires to Brisbane, or Jacksonville to Johannesburg, to be flown in less than 14 hours.

But how frequently will passengers use these aircraft for 14-hour—let alone 15.5- to 16.5-hour—trips? The average mission length for this class of aircraft is about three hours—1,300 to 1,400 nm. That isn’t stopping Bombardier, Dassault, and Gulfstream, however, from betting billions on these flagships. A sizable number of customers will likely be ultra-high-net-worth individuals, billionaires seeking the most exclusive, bespoke air yachts, more for country club bragging rights than pure air transportation needs.

Enter the Gap

This upmarket thrust by Bombardier, Dassault, and Gulfstream is creating a noticeable gap in entry-level large-cabin business aircraft, ones with 4,000- to 6,000-nm range. Currently, there are seven players in this field: the Bombardier Challenger 650 and Global 5500, Dassault Falcon 2000LXS, Falcon 900LX and Falcon 6X, and Gulfstream G400 and G500. Each offers some features buyers expect in a 21st-century large-cabin aircraft. None offer them all.

Each of the seven models merits a close look to identify its strong points and disadvantages. Dig deeply into the numbers, and the size of the large cabin chasm becomes quite apparent. 

The senior citizen of this class is the Bombardier Challenger 650. It’s grandfathered onto the original 1980 Challenger 600 FAA type certificate. It’s the least expensive large-cabin aircraft, but it offers the widest cabin, measuring almost eight feet wide at elbow height and nearly seven feet wide at the floor. It’s six feet high in the center, so this is one of the most comfortable large-cabin aircraft, at least among those with only two seating sections.

The 650’s floor plan most commonly has a four-chair forward club section and an aft four-seat conference grouping flanked by a three- or four-seat divan on the opposite side. Virtually all aircraft are completed with a forward galley ahead of the main two-section seating area, and a single aft lavatory with a rear door that provides inflight access to the aft baggage compartment. There isn’t a second forward lavatory for the crew.

Gulfstream G400 cabin [Courtesy: Gulfstream]

The Challenger 650 is the fifth iteration of the legacy design, featuring larger cabin windows, updated avionics, and plusher interior furnishings. It makes the grade as a long-range large-cabin aircraft because you can squeeze out 4,000-nm legs, but only if you’re willing to slow down to Mach 0.74 (425 knots) average cruise speed. A 4,000-nm trip takes 9 hours, 30 minutes aboard this aircraft.

Push the Challenger 650 up to Mach 0.80, and its range drops to 3,700 nm, smack in the middle of the current generation of super-mids. Climb performance isn’t something Challenger 650 operators brag about, either. When departing at maximum takeoff weight, it’ll only reach 37,000 feet on initial climb. It’s also limited to a 41,000-foot ceiling, so you’re stuck in the organized track systems with Boeings and ‘Buses most of the time when crossing oceans. Plus, the cabin altitude at FL 410 is nearly 7,000 feet. The Challenger 650’s comparatively high wing loading, lack of leading edge high-lift devices, and 30-year-old engine technology also result in relatively long runway requirements, particularly when departing from high-density-altitude airports.

Performance Gains

The Dassault Falcon 2000LXS, in contrast, offers sprightly airport performance because of its full-span leading-edge slats, blended winglets, high-lift flaps, and sporty 7,000-lb.-thrust Pratt & Whitney Canada engines. It’s the fuel-efficiency leader in the large-cabin class because of its comparatively lightweight airframe and fine-tuned aerodynamics. It too, has a two-section cabin that is slightly longer, but a few inches narrower than the Challenger 650’s. Typical floor plans feature a forward, four-chair club section, and an aft four-seat conference grouping with two facing chairs on the opposite side. There is a forward galley and aft lavatory. As with the Challenger, there is no forward crew lavatory.

FALCON 2000LXS [Credit: Stephen Yeates]

The Falcon 2000LXS will fly 4,000 nm with six passengers while cruising at Mach 0.80, according to Dassault. But its actual average cruise speed, as shown by the accompanying chart, is 430 ktas. Plan on 9 hours, 18 minutes for such trips. This aircraft can fly as high as 47,000 feet. The 9.3-psi pressurization system provides a maximum cabin altitude of 7,200 ft. at that altitude.

Spoiler alert: Gulfstream G400 arrives in less than two years. The smallest member of the GVII family is designed for a long-range cruise speed of Mach 0.85 because of its highly swept, super-critical wing, powerful engines, and high-altitude cruise capability. Its maximum range is 4,200 nm. We predict an average cruise speed of 481 ktas, so it will shave an hour off of a 4,000-nm trip compared to the Challenger 650 orFalcon 2000LXS. Its cabin cross section is very close to that of the Falcon 2000LXS, but it’s considerably longer, making room for 2½ seating sections, thus providing seating for up to 12 passengers. Each seating section is longer than either the Challenger 650 orFalcon 2000LXS, yielding more legroom for each passenger.

If buyers opt for shorter, two-section cabins, it makes space available up front for an optional forward crew lav. All models are equipped with a forward galley and aft lavatory. These aircraft have the highest pressurization in the class, thus cabin altitude never exceeds 4,850 ft., even at the 51,000-ft. Maximum cruising altitude. As a bonus, the G400 is the only entry-level large-cabin to boast fly-by-wire flight controls. This aircraft promises to bruise sales of both the Challenger 650 and Falcon 2000LXS.

Next up in Dassault’s product line is the Falcon 900LX, a distant derivative of the 1979 Falcon 50 trijet. It shares its fuselage cross section with the Falcon 2000LXS, but its main cabin is 6 feet 5 inches longer, sufficient for three comparatively short seating areas. Many aircraft have both forward crew and aft passenger lavatories, a welcome feature on long trips. All current production aircraft have forward galleys. Maximum cabin altitude is similar to that of the Falcon 2000LXS.

The Falcon 900LX shares its wing contours with the Falcon 2000LXS, along with full-span slats and high-lift flaps, providing excellent airport performance. But sharing the same wing aerodynamics also means its average cruise speed on the longest missions is only 420 ktas. A 4,650-nm trip takes slightly more than 11 hours.

Turn Up The Volume

The Bombardier Global 5500 is the heavyweight in this class, with the largest dimensions. It provides the second-largest cabin volume of any aircraft in this segment. The three-section cabin is typically configured with a four-chair club up front, a four-seat conference grouping on the left, an optional chaise on the right in the midsection, and a private stateroom in the aft section. Almost all aircraft have forward galleys and an aft lavatory, plus a second forward crew lavatory. The 10.3-psi pressurization system ensures cabin altitude never exceeds 5,700 feet.

Bombardier Global 5500 [Credit: Bombardier] 

The Global 5500 is a derivative of the Global 5000, a shortened version of the original 1998 Global Express. The newest model has upgraded Rolls-Royce engines with improved efficiency and a drag-reduction package that boosts its range to 6,000 nm. Powerful engines and full-span leading-edge slats endow it with excellent runway performance.

But shortening the Global Express didn’t save much weight. The Global 5500’s relatively ample girth hurts its fuel efficiency. It consumes 15 to 50 percent more fuel than other three-section large-cabin competitors. That’s damaging its popularity among large cabin jet buyers in today’s eco-conscious environment.

Gulfstream’s G500 is the closest competitor to the Global 5500. Its three-section cabin gives up 4 inches of maximum width, but all members of the GVII family have a non-circular cross-section that makes more room available at shoulder height for seated passengers. The main seating area is also slightly shorter than that of the Global 5500. Like other three-section, large-cabin aircraft, the G500’s interior is typically configured with a forward, four-chair club section, a four-seat conference area and credenza mid-cabin, and a private aft stateroom. All models have forward galleys and crew lavatories, plus an aft lavatory. GVII series aircraft—G400/G500/G600—have the highest pressurization in class with cabin altitude always remaining at or below 4,850 ft. And nothing in the sky has a quieter cabin. Those lower cabin altitudes and noise levels translate into lower fatigue on long-range missions—a critical factor in their long-term operational success.

Powerful engines and an impressively large wing give this aircraft runway performance on par with Global 5500, even though the Gulfstream lacks leading-edge slats. Fuel efficiency is the best of any three-section large-cabin aircraft that cruises at Mach 0.85. Similarly to the G400, the G500 has fly-by-wire flight controls.

Next One Up?

If cabin comfort is your top priority, nothing can touch the new Falcon 6X. This aircraft has the largest cross-section of any current-production, purpose-built business aircraft, netting an 8-foot wide and 6-foot, 4-inch high interior, according to our tape measure. The cabin is also virtually the same length as either the Global 5500 or Gulfstream G500. Thirty windows, each the largest of any Falcon yet built, flood the three-section cabin with bright ambient light. The main seating area has the typical four-chair club section up front, a four-seat conference area and a credenza in mid-cabin, and aft stateroom. All floor plans include a forward galley, crew lav, and an aft main passenger lavatory. There’s even a skylight in the ceiling above the galley.

Dassault Falcon 6X [Credit: Dassault Aviation]

The 10.2-psi pressurization system ensures cabin altitude never exceeds 6,000 feet. The Falcon 6X will likely cruise in the low forties, so actual cabin altitudes will range from 3,500 to 4,800 feet. Dassault also has made sizable reductions in cabin sound levels in recent years. The goal is to beat Gulfstream for quietest cabin honors. Plan on mid-40 dBA interior noise levels when this aircraft enters service later this year.

The Falcon 6X also vies for having the most advanced aviation technologies. Borrowing heavily from Dassault’s Mach 2 class Rafale strike fighter, the firm pioneered fly-by-wire flight controls in business aircraft with the Falcon 7X in 2007, and has been enhancing its digital flight control systems ever since. This makes the Falcon 6X feel as agile as the Falcon 10, based on our experience flying it. Even more important to both pilots and passengers, there are dozens of subtle enhancements that reduce flight-crew workload, improve situational awareness, and make the aircraft one of the safest ever designed. Note to pilots: This aircraft consistently touches down on the pavement as though it’s nestling into a feather bed.

The tradeoff for the Falcon 6X’s class-leading cabin comfort is comparatively modest performance. The Falcon 6X is a redux of the ill-fated Falcon 5X that was doomed by the development failure of its planned Snecma Silvercrest turbofan engines. When Dassault halted the Falcon 5X program, it elected to re-engine the Falcon 5X with well-proven Pratt & Whitney PW800-series engines while stretching the fuselage and adding fuel capacity. But the wing area remains the same while weight increases by nearly four tons. This results in the highest wing loading of any large-cabin business jet. That doesn’t help high-altitude climb and cruise performance. 

The Falcon 5X also was designed when large-cabin business aircraft mostly flew at Mach 0.80, so Dassault mapped out the wing shape and sweep accordingly. At that speed, the Falcon 6X has a 5,500-nm maximum range. Push up the speed to Mach 0.85, and its range drops to 5,100 nm.

Cruising at Mach 0.80, the Falcon 6X’s fuel efficiency is better than the Global 5500’s, but not as economical as the G500. Cruising at Mach 0.85, the Falcon 6X’s fuel consumption is on par with the Global 5500.

Wing loading also has an impact on runway performance. While the Falcon 6X has one of the best high-lift systems, high wing loading results in the longest takeoff field lengths among direct competitors.

What Does the Market Want?

Perusing the strengths and compromises of this septet reveals the need for a clean-sheet design that offers the best qualities of each of the seven competitors. First, there’s no such thing as too large a cabin. Best-in-class 5,500-nm to 6,000-nm large-cabin jets, such as the Global 5500 and Falcon 6X, have 1,800- to 1,900-cubic-foot cabins by volume. That’s a good start, but that’s still one-third smaller than the four-section-cabin uber jets. Pairs of facing chairs typically convert into lay-flat berths, so three-section aircraft usually comfortably sleep no more than six people. Four-section cabins berth eight sleepers.

Buyers also want pressurized cabin altitude slower than 5,000 ft., and sound levels in the low-to mid-40 dBA range. They want forward and aft lavatories, galleys that can hold four to five full meals, and aft staterooms that afford complete privacy. Future aircraft require a forward lav for the crew, a mid-cabin lav for most passengers, and a third en-suite lavatory adjoining the aft stateroom. 

Connectivity is key. More than one large-cabin jet operator has scrubbed a trip because WiFi and high-speed internet access systemswere inoperative. People in this class of aircraft expect connectivity on par with homes and offices. Worldwide KA-band satcom with WiFi mobile phone calling is almost an iron-clad necessity. Emerging low-earth-orbit KU- and KA-band satcom networks promise to give market leader Viasat hot competition and lead to considerably lower subscription prices. Wideband satcom typically is a $750,000 to $1 million option. Most large-cabin-class operators consider it a necessity.

[Infographic provided by Josh Roden & Brandon Cafferky]

The segment of the market represented by these seven platforms is not only hotly contested, but it’s also ripe for the right competitor to hit the niche combining the cabin comfort of the 6X and Global 5500, the speed of the Gulfstreams, and the fuel efficiency of the Falcon 2000LXS. [Infographic provided by Josh Roden & Brandon Cafferky]

Cabin comfort, convenience, and connectivity notwithstanding, passengers also expect new 4,000-nm to 6,000-nm large-cabin aircraft to offer more speed. Cruising at Mach 0.80 suddenly seemed so 20th century when the Mach 0.85 G650 debuted a decade ago. Gulfstream anchored the Mach 0.85 cruise speed benchmark with the G400 and G500. New-model large-cabin buyers now expect to cruise at that speed and dash at Mach 0.90 without an excessive increase in fuel consumption. Cruising at Mach 0.90 can shave an hour or more off trans-oceanic trips.

And finally, new large cabin entrants must offer at least 15 percent better fuel economy. GE, Pratt & Whitney, and Rolls-Royce continue to squeeze at least 5 to 7 percent more efficiency out of each generation of new turbofan engines. This puts pressure on airframe designers to develop radically reduced-drag large-cabin airframes—especially as people want much larger three- or four-section cabins.

Large-cabin-jet design challenges will be daunting, considering that such aircraft will also routinely cruise at up to 90 percent of the speed of sound, yet still be able to operate from hundreds of general aviation airports. There’s no point in having an airplane that saves an hour of trans-oceanic trip time if the closest suitable airport is 90 minutes from your home or office.

All of this points to the need for a new generation of entry-level, large-cabin aircraft that combine the cabin comfort of the Falcon 6X and the Global 5500, the speed of the Gulfstream G400/G500, and the fuel efficiency of the Falcon 2000LXS. That’s a stratospheric stretch in capabilities, but one that could yield soaring sales in the large-cabin segment.

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