Private jet travel has grown hugely, relatively speaking, over the last five decades. Now two major trends are looking to take private jets to an even wider customer base.
Online booking services like Stratajet have the potential to make flying private only a little more expensive than flying business class on some routes. And then there is Kenny Dichter’s Wheels Up membership program, which, by February 2017 had racked up some 4,000 members from a standing start in August 2013.
Few people in business aviation have done more to widen the appeal of private jet travel than Dichter and his team. Before Wheels Up, he revolutionized the fractional ownership of executive jets with the introduction of Marquis Jet and the Marquis Jet card, which offered a 25-hour share of an executive jet for $8,000 dollars an hour, instead of the $300,000-dollar price for a 1/16th share of a jet being demanded by the fractional operators, NetJets and Flexjet.
That innovation brought executive jet travel within the reach of large numbers of smaller businesses and individuals. Dichter then sold Marquis to Warren Buffet’s Netjets and went on to target an even broader section of the middle classes with his new concept. Wheels Up offers members access to their private fleet of King Air 350i for $4,295 an hour.
There was some scepticism in the industry that a twin turboprop aircraft, even configured internally to the same standard as a business jet, would be sufficiently attractive to potential travellers. Now, four years on, the scale of the membership and the size of the Wheels Up fleet, plus the number of hours flown, is ample proof that Dichter’s idea really does have legs.
The basic idea, from the outset, was to have a national fleet of King Air 350i aircraft located at up to seven regional centres, providing plenty of capacity for an “on-demand” service for Wheels Up members. In practice, the idea has evolved, with Wheels Up introducing a tiered membership structure to make membership still more accessible. Another nifty marketing idea is its Shared Flight program. Via the Wheels Up Member App and Website, any member can introduce the fact that they are taking the whole aircraft, which costs $4,295 on the King Air, and can invite other members to join them for the trip. As Dichter explains, each seat price works out at 1/8th of that $4,295, so if someone decides to take up the offer of a ride share and brings along three others, that’s half the cost of the trip paid for. “This has proved to be a very cheap and reasonable way of escaping the constraints of scheduled flights and flying private instead,” Dichter notes.
There is an initiation fee of $17,500 for the standard membership and, starting from year two, annual dues of $8,500 a year. The entry level membership is the 8760 tier – 8760 being the number of hours there are in a year. At this entry level the membership charge is $6,950. “That figure gets you all the ride sharing opportunities, the option of coming to all the special events that we run for members as part of our “Wheels Down” program, and most of the benefits of a full Wheels Up membership,” Dichter says.
Wheels Down was Dichter’s idea for broadening the scope of membership to make it more of a lifestyle club, rather than just a way of flying private. Wheels Down offers members access to exciting experiences, ranging from exclusive parties and celebrations around popular events like the Super Bowl, the Masters and Art Basel to more intimate gatherings hosted by A-list of Ambassador athletes, entertainers and industry leaders. Members also receive value added benefits from a curated list of luxury partners including access to a global concierge service.
Commenting on the progress made so far, Dichter says that the company and the membership numbers are slightly ahead of where he had envisaged at the launch. The Wheels Up fleet of aircraft at the end of 2016 stood at 72 units, with 57 King Air 350i’s and 15 Citation Excel/XLS aircraft. The Citations are available to members who are planning on taking trips that are either beyond the range of the King Air, or that are over 2.5 hours flight time.
It is worth emphasising that Wheels Up owns the aircraft but it does not operate them. Gama Aviation is the operator for the entire Wheels Up fleet and to date, Dichter says, the relationship between Wheels Up and Gama has been first class. “That division of responsibility is working really well,” he comments.
By February 2017 Wheels Up had 175 employees and Gama had almost 350 pilots and crew supporting the operation. “This business has reached the point where it has a reasonable scale to it, but given the size of our potential market we have a very long way to go. Moreover, we seem to be moving into a more favourable economic climate, certainly here in the US. I think the Trump Presidency is going to be very good for business aviation. After all, Trump’s own personal jet is a well-known icon in the industry,” he observes.
Europe, long a target for Wheels Up, could see a membership program launched at the back end of this year or possibly in 2018, according to Dichter. Much depends on how things turn out for both the US and the Eurozone economies in the months ahead.