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| Features |
Comfort without Commitment
Michelle Seaton
07/01/2004
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Of the common business aircraft usage options, charter seems like the elder
statesman in a world awash with upstart fractional contenders and glossy private
jet brochures. But for many of us, charter remains the most affordable, flexible
way to fly. “Typically, charter is cheaper,” says Steve Gregory, executive vice
president of the Averitt Aviation Group in Nashville. “It is the most
cost-effective solution of all forms of private air travel, out to about 400
hours per year.”
Though not as glamorous as jet ownership, nor as consistent
in terms of passenger experience as fractional, charter requires no long-term
financial or administrative commitments—a significant selling point for charter
customers. There are no tax or depreciation issues; there is no haggling with a
fractional program manager over resale values. At the end of the travel day, we
are free to focus on our businesses, rather than on the management of an
expensive airborne asset.
Charter’s comfort-without-commitment model works
well for Greg Lemke, president of landscaping equipment dealer All Seasons
Vehicles (ASV) in Grand Rapids, Minn. In the spring of 2003, to reduce the time
he and his sales team spent traveling to and from the regional commercial
airport that services their area, Lemke chartered a Citation CJ that could land
at a nearby airfield. Twice a week for three months the Citation picked up three
sales people at 7 am and delivered them two hours later to Denver, one of the
frequent sales destinations for the ASV sales team. There, three rental cars
would be waiting at the airport. On Friday at 3 pm that same plane would return
to Denver to bring the reps home to Grand Rapids for the weekend.
In this
charter arrangement, Lemke bought about eight flight hours a week, including the
time the aircraft spent flying empty (called the “deadhead legs”). At $1,200 per
hour, he spent roughly $10,000 per week on flight time alone. While his charter
flight expenditure over the course of three months exceeded $130,000, he
considers it a bargain. “We got five months of work done in that three-month
period because we weren’t losing Mondays and Fridays to travel,” he says, adding
that during that three-month period, his sales teams generated an extra $3
million to $4 million in new business.
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