Last week, Flight Options CEO Michael Scheeringa shared his insights into the private jet industry in a phone interview with Helium Report. In part one of this three-part series, we covered his thoughts on fractional jet programs as compared to on-demand charter. Scheeringa asserted safety is a key determinant for consumers deciding between these two private aviation options.

Today we’ll discuss why Scheeringa argues fractional jet programs are safer than charter jet services. In part three, we’ll go into more depth on Flight Options’ Fractional First and JetPass Ultimate Travel programs.

Zero Loss of Life

Scheeringa emphasized the safety record of fractional jet programs, stating the industry segment has been fortunate to experience zero loss of life to date. He says the safety record for fractional jet fleets is “on par with the top 10 major airlines, six times better than regional airlines, and six times better than for-hire [charter flights].”

In particular, Scheeringa noted two highly publicized charter jet crashes: the tragic loss of Dick Ebersol’s son in a 2004 crash in Montrose, Colorado (see excerpt from Wikipedia.com, below) and the corporate jet that ran off a Teterboro Airport runway in 2005. In the latter case, the FAA shut down the Platinum Jet Services, the charter operator.

Consumers See Value in Price Premium

Scheeringa (photo, right) suggests consumers are willing to pay a 20-35% premium for fractional programs over charter flights for a superior safety record, one-stop shopping, consistency of product, and availability guarantees. He cited Flight Options’ “state-of-the-art operations control center” and in-house maintenance crews as two examples where a fractional jet provider offers a service layer above that of on-demand charter providers.

Flight Options also promotes the youth of its aircraft fleet, which averages 6.5 years, according to Scheeringa. His firm has reduced the average from 10 years to 6.5 over the last 30 months, whereas he claims competitors’ fleets have aged two and a half years over the same time period. The reduction is due in large part to Flight Options’ deliberate attempt to simplify its fleet and fly only four aircraft types (more details in Part 3).

FAA Regulations for Charter Operators

In late December 2006, the Federal Aviation Administration announced “OpSpec A008” for Part 135 air charter operators. The Operations Specification requires the air carrier to have operational control of the aircraft, including pilots, support staff, maintenance, and insurance.

The FAA has published a new Operations Specification (Opsspec A008) to Part 135 air charter operators regarding operational control of aircraft. The new A008 impacts both aircraft owners that have placed their aircraft on a Part 135 charter certificate and charter operators. It will be important for charter operators to conduct a thorough review of their operational control systems as Principal Inspectors will be conducing reviews in 2007 to ensure that these systems are robust and sustainable. Aircraft owners will also need to adhere to limitations and prohibitions with respect to their involvement with the charter company’s control of aircraft and crew used in Part 135 charter operations.

In the frequently asked questions section on the National Business Aviation Association (NBAA) website, the trade organization states: “Part 135 operators currently are not required to provide an operational control briefing to passengers… Unfortunately, this basic issue was a key component in the Teterboro Challenger accident in February 2005.”

Scheeringa believes the new OpSpec, which takes effect this month, will benefit Flight Options. He predicts “there will be a realization on how much higher quality and value there is for fractional than charter” based on consumers’ increased awareness of which entity is in actual operational control of the aircraft.

In part 3, we’ll discuss the changes Flight Options have implemented over the last few years to design programs that differentiate them from their peers and meet their customers’ needs.

(Part 1 of the series starts with Michael Scheeringa’s overview of the differences between fractional programs and on-demand charter providers.)

Note to Readers: Halogen Guides is the new name of Helium Report.