Private Jets Attract More Corp. Travelers

Last month Procter & Gamble signed on with Waltham, Mass.-based FlightTime.com for exclusive use of an Airbus 320 jet to ferry its travelers back and forth between its Cincinnati headquarters and Brussels. The move underscores a trend toward private jets as corporations look to liberate their travelers from inconsistent and often inadequate service from the major airlines while sidestepping potentially expensive hub pricing.

Companies choose to use private jets—either leased, part-owned or fully owned—for a number of reasons. Of course, senior executives of large corporations are the most likely to use such planes. In fact, many of the top travel buying corporations in the United States use private jets in some form. Preliminary data compiled from 37 of BTN's Corporate Travel 100 companies shows that 59 percent of those companies own at least one corporate jet. Another 27 percent either lease or timeshare private jets. One travel manager from a CT100 company said senior executives are entitled to use the corporate jet and "sometimes non-senior executives can use the jet also if it has not been declared closed and the route matches. They tend to like those instances a lot."

Many of the emerging dot-com companies also are beginning to use private jets. These new economy corporations, as well as companies in many other industries, are starting to use the appeal of chartered or company-owned planes to attract and retain highly sought-after talent. While such a strategy is not as cost effective in many circumstances, travel managers increasingly are aware of the special treatment necessary for the company to achieve its goals and compete. Indeed, a delicate balance is needed in the price-value equation. Each travel manager must determine if the service value—privacy, efficiency and comfort—is worth the extra money in a given situation. Keeping costs down is only half the battle.

Meanwhile, individual business travelers caught in a pinch and unwilling or prohibited to pay astronomical walk-up fares, and without access to a corporate jet, might consider Flightserv.com, the latest Internet-based charter jet company (BTN, Nov. 15, 1999).

The Atlanta-based company this month will unveil its Private Seats program that enables individual business travelers to log on to the Web site and seek out available seats on charter aircraft. Initially, Flightserv.com will provide jet transport between Teterboro Airport just outside of Manhattan and Atlanta's DeKalb-Peachtree Airport. More than 100 city pairs are expected to be available by year-end. The site also includes ground transportation and lodging options.

Flightserv.com and Sabre recently signed a deal that will fold Flightserv's functionality into the Sabre BTS system. As a result, BTS users at more than 350 companies and connected travel agencies will have the option of chartered jets when arranging travel plans.

"We are transforming the business travel marketplace by offering business travelers access to a better way of traveling," said C. Beverly Lance, Flightserv.com president and CEO.

While the largest corporations, such as P&G with an annual air spend of $130 million, seem to be the most frequent users of private jets, it is clear that they are becoming an alternative for many others. Does this mean fortress hub carriers have much to worry about? Probably not. But neither can they expect to retain all their elite, high-profile frequent flyers without raising service standards or on-time performance, when comfortable, speedy status symbols await at a nearby, uncongested airport.