Few Agents Involved in Private Corporate Air Market

The private aircraft side of business travel is ripe for management, but so far corporate travel managers, travel management companies and business travel agents are missing in action. And that means they’re missing an opportunity.

“Too many travel managers just don’t know about this segment of the business travel market. It’s a very opaque and fragmented market that is run largely by brokers,” said Bill Herp, president of Linear Air, a charter operator in the Boston area.

Herp said he sees more travel manager involvement in private corporate air travel in the future. “I expect travel managers to become more responsible for this segment of business travel as the market develops and matures.”

Unmanaged business travel
How much business travel is taking place on private carriers? How dark is the black hole of private business travel? American Express, BCD Travel, and Carlson Wagonlit all declined to discuss the topic. They said either that private flight volume was too small to track or that the one person familiar with the segment was not available.

“That’s code for, ‘We haven’t figured out how to track this and charge transaction fees,’” said business travel agent Al Gilbert.

“As commercial flying becomes less predictable because of delays and more time-consuming because of capacity controls and reduced numbers of flights, private flights are becoming a more attractive option. It just doesn’t go through the travel department,” said Gilbert, contract corporate sales manager for Christopherson Business Travel in Larkspur, Calif.

“Travel managers should be handling business aviation because it’s part of the travel spend, just not a recognized part for many companies,” Gilbert said. “It takes more effort than managing travel booked through a GDS, but managing private flights are part of the job.”

Travel managers are MIA
Tracey Chaplin, vice president of procurement for XOJET, a charter operator in Brisbane, Calif., near San Francisco International Airport, said she seldom works with corporate travel offices. She deals primarily with executive assistants and corporate flight departments.

“Travel managers use GDSs, and booking private flights is completely different,” she explained. “Private traffic doesn’t come up on any GDS because we’re on demand, not on schedule.

“Managing private air travel is a different skill set from managing commercial air travel, starting with a different set of airports and codes,” Chaplin said.

Advantages of private air travel
Commercial air carriers serve about 500 airports across the U.S., according to the Global Business Travel Association. By contrast, private aircraft serve 5,000 airports.

Here’s another advantage: While business travelers must fit work around commercial carrier flight schedules, private carriers fit their flights to the traveler’s work schedule.

“Private aircraft offer comfort, cost and convenience,” Gilbert said.

“Think of a corporate road show where a business jet lets you make two or three presentations a day, instead of one meeting using commercial flights. If you can get in front of twice as many potential investors using private aircraft, it’s worth the cost.”

Balancing time and money
The effectiveness of private aviation comes down to balancing time and money. On a dollar basis, private aircraft are slightly more expensive than first class, but the cost per passenger can drop significantly depending on the itinerary and number of travelers.

On a time basis, Gilbert said, there’s no comparison. Private aircraft outfitted for the business market have global telephone and electronic communications, including wi-fi.

They offer privacy, meeting space, and working time that no commercial carrier can provide. If an event ends early or runs late, the flight is ready to go when the last traveler is on board. No more unexpected overnights or time lost sitting in airports.

For most companies, the choice between commercial and private aviation is not an either-or proposition. “One augments the other,” said Dan Hubbard, vice president of the National Business Aviation Association.

“If you need to fly to a destination that doesn’t have commercial flights or has minimal commercial service, business aviation may be your only option. If you’re sending one person to a major destination, commercial is probably the way to go. If you’re sending a team, business aviation could be more effective.”