Millionaires may face year-end jet shortages

The pandemic served to remind millionaires that they do not need to subject themselves to crowded flights, a long wait at airports (even in the VIP room) or having to adapt their schedule to the regular flights of major airlines.

Given the reduced availability of seats on commercial flights, they can simply rent a jet, even per app.

The business jet charter market, which has been heated since the beginning of 2021, is on the rise this year-end. Well-heeled customers are preferring exclusive routes and service to avoid the risk of contamination and ensure greater privacy.

Three of the largest executive aviation companies in the country –Flapper, Líder and TAM Aviação Executivo– have already started to deny requests for jets made at the last minute.

“We are an air taxi company and, in general, we can organize a flight in 40 minutes”, says Junia Hermont, chief operating officer of Líder Táxi Aéreo, a company founded in 1958. “But, since last month, we have had to deny travel requests made without advance,” she says, who has seen demand grow 15% this year.

In the company, where 90% of charters are for business travel, the recommendation is that trips be booked at least ten days in advance. The value changes depending on the aircraft model.

A round-trip flight from Belo Horizonte to São Paulo, for example, in a King Air C90GT, costs around R$ 24,000. The same route in a HondaJet costs R$ 30 thousand and, in a Hawker 800XP, it goes over R$ 38 thousand.

“Executive aviation allows for much greater mobility, with landings allowed at approximately 3,000 airports in the country, against an average of 120 destinations served by airlines”, says Leonardo Fiuza, president of TAM Executive Aviation (AE).

At the company, the number of charters grew 60% in 2021, compared to the pre-pandemic period, as many passengers did not travel last year due to the uncertainties caused by the coronavirus.

“Looking for greater speed and comfort, many people have been looking for less public options to fly the pandemic”, says Paulo Malick, president of Flapper.

According to him, commercial aviation can generate 600 contact points with a risk of contamination by the new coronavirus. “But in executive aviation, this risk comes down to 30 points,” he says.

The company saw a 20% growth in demand for jets this year, compared to 2019. This year, among the leisure trips most sought after by Flapper are São Paulo-Trancoso (BRL 200 thousand, round trip) and São Paulo. Paulo-Caribe (R$900,000 round trip), with emphasis on the islands of Saint Martin and Barbados.

But millionaires need to hurry, because they run the risk of running out of flights. “We are with 80% occupancy by the end of January”, says Guilherme Régis, commercial analyst at Flapper.

The company, which has around 100 executive jets at its base, has already had to deny flights to Salvador and Morro de São Paulo (BA), for example, due to the fact that the aircraft were leased during the period. Flapper does not own the jet, it acts as an intermediary between the renter and the customer.

“There is a lack of ultra-range aircraft, which allow non-stop flights,” says Régis, who is also a pilot. One of the first signs that demand was above forecast was seen at the end of the Copa Libertadores da América, in Montevideo, on 27 November.

“We only made two charters for the date because there was a lack of aircraft”, he says, noting that the runway at Carrasco International Airport, in the Uruguayan capital, had to be closed, due to lack of space.

The cost of the round trip by jet, to Montevideo or Punta Del Leste, departing from São Paulo, was around R$ 200 thousand.

It is worth remembering that all this increase in demand is due to the rise in aviation fuel, which required a change in fares. Only at Flapper, there were four adjustments this year.

One option for those who are going to make shorter flights and want to keep their privacy are helicopters, also on Flapper’s charter base. The business has increased 30% this year.

A departure from one of the helipads on Avenida Faria Lima, in the west side of São Paulo, for example, towards Angra dos Reis, in Rio de Janeiro, costs R$ 30,000 (one-way flight only).

If you don’t want to rent, buy an aircraft

With demand on the rise, Flapper began this month to sell aircraft. In the company’s application, customers can not only search for charter options, but also order the purchase of their used private jet – an Embraer Phenon 300 model, for example, costs US$ 5 million (R$ 27.8 million) .

At rival TAM AE, jet sales grew 70% this year over 2019. The most demanded model is the Beechcraft Corporation’s King Air 260, which can cost up to US$ 7.5 million (R$ 41.7 million).

“There is great demand, especially from agribusiness entrepreneurs, who are looking for aircraft that land on a dirt road,” says Fiuza, who is already selling aircraft for delivery in 2023.

The company, founded by commander Rolim Amaro in 1961 and continuing with the Amaro family, with no connection to Latam Airlines, is the representative in Brazil of the manufacturers Cessna, Bell, FlightSafety International and Beechcraft.

According to Fiuza, there has been a global increase in demand for executive jets, whose manufacture involves an extensive supply chain. “This prevents the industry from responding quickly, hence the lack of aircraft on the market,” he says.

At TAM, around 80% of operations are focused on executive travel. “The demand for chartering jets continues, even with the resumption of commercial flights,” he says.

One of the most popular routes is from São Paulo to Rio de Janeiro, which costs around R$ 35,000, round trip.

At Líder, new and semi-new aircraft are sold. The company is the exclusive representative of Hondajet. The Elite S. model, which costs US$6.8 million, is one of the most sought after. “Today we are accepting orders for delivery in 2023”, says Junia.

Accidents with celebrities make customers afraid

As for air accidents involving executive jets –such as the one that killed singer Marília Mendonça on November 5th–, there is an immediate fear related to the model.

“At the time, many customers who were booking flights asked that the aircraft not be the King Air C-90 A”, says Guilherme Régis, from Flapper.

The model was similar to the one that killed Cosan Celso Silveira de Mello Filho and his family, the King Air 260, in September. “But no one can verify the problem with the aircraft until the entire investigation by the authorities is concluded,” he says. Regis.