As I’ve written before, a plane would come on the market in the morning and by lunchtime there would be five full price offers. Then the seller would revert to a bidding war. Not only for the highest price but also for how scaled back the due diligence was being discussed. I often said we should run an ad that says: ‘Hire Mesinger Jet Sales and let us manage your greed.’

We paired down significantly the number of transactions we would be involved in for the fourth quarter of 2021 and 2022 based on the frustration that our clients would suffer trying to keep up with a process that was so seller centric. It started to feel good in 2023 when the market began to shift back to more balance, with increased inventory and greater opportunity to negotiate a more usual and customary transaction.

As we make our way into the second half of 2024 and quickly Q4, I am starting to hear a familiar chant again. If we thought getting pre-buy slots was difficult during the pandemic, just hold on, it is beginning to look a lot like that again. We are getting back to needing a slot booked two and three months out.

This will initiate conversations from our clients of paired down due diligence that we must be very wary about. Don’t be fooled into contemplating a very scaled back pre-buy to allow for a better chance of completing a transaction in a shorter more predictable timeline for year-end tax purposes. There is no such thing given the continued supply chain issues and labour issues of a totally predictable timeline. What can be totally predictable is the expectation of a close within a reasonable period, but not a year-end close.

We are getting to that time of the year when we all are going to start getting calls from buyers who say they want to buy a plane and must close by year end. It might seem early enough for that call and the ability to get closed in time. However, one silly discrepancy – like a piece of skin for a repair that may take six months to manufacture – and the deal is stalled. That of course is an extreme case, which more than likely would hamper the transaction anyway, however, don’t underestimate the timing for rectification.

So, I am starting to hear the old mantra, let’s just pick a number that seems reasonable and reduce the price of the plane and perform very minor views then close. Seems simple but what if…?

We as an industry literally clawed our way back to the opportunity to perform the right, smart due diligence, let’s not slip backwards.

I wrote an article once about manufactured tensions. As if we don’t have enough tensions without manufactured tensions. As a good friend of mine who is a fellow sales professional said to me a few weeks ago: “We need to all work now to help our clients have the right adjusted expectations as we take them into the end-of-year transaction arena”.  Read the previous Mesinger Pulse article here.

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The private aviation company saw an 8% increase in flight service revenue to $163.6m, offset by declines in other areas such as membership and aircraft management.

“Since the strategic investment, we have made strong progress on a number of key fronts. Revenues have stabilised after a long period of time as we continue to make changes across the board,” said George Mattson, the company’s CEO while talking to Corporate Jet Investor.

CEO George Mattson emphasised the company’s focus on rebuilding sales and improving overall performance.

“We made significant progress over the past quarter to improve our business for a sustainable future,” said Todd Smith, Wheels Up CFO.

“We are continuing to optimise our cost structure and fleet to focus on profitability. With improving liquidity in the fourth quarter and our partnership with Delta, we believe we are well positioned to continue to invest in our business for the long term.”

Operational losses narrowed from $82.6m in Q1 to $79m in Q2, driven by belt tightening in the form of reduced general and administrative expenses. The company’s contribution margin also improved significantly, reaching 7.8% compared to 1% in the previous quarter.

Wheels Up’s cash burn decreased substantially to $27m in Q2 from $73.8m in Q1, with cash reserves standing at $141m as of June 30.

The company expressed confidence in its ability to invest in future growth, supported by improved liquidity and its partnership with Delta.

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The award reflects the firm’s voluntary measures to reduce aircraft noise to surrounding communities, said Clay Lacy’s Dondi Pangalangan, Senior Vice President, Strategic Initiatives.

“Being a ‘Friendly Flyer’ aligns with our overall, thoughtfully better approach to private aviation services and our continued efforts to work with communities to reduce noise and our environmental footprint,” said Pangalangan. “We are committed to being a good neighbour to our communities and to intentionally consider and implement sustainability strategies into all aspects of operations and facilities.”

The Fly Friendly Program recognises jet operators that go beyond mandatory noise regulations to further reduce noise disruptions at Van Nuys. Some of the criteria considered include increasing southbound jet departures, avoiding overnight flights and achieving compliance at 99% or greater on No Early Turn and the Quiet Jet Departure programmes.

“Clay Lacy reaching these voluntary heights demonstrates the company’s continued efforts to be a great partner with the Van Nuys Airport community,” said David Reich, Los Angeles World Airports’s deputy executive director for Mobility Planning and Strategy. “These programmes help our city to appeal to residents and businesses alike, and help make us stronger economically.”

LA City Councilmember Imelda Padilla was on hand with Los Angeles World Airports CEO John Ackerman, and Los Angeles Board of Airport Commissioners President Karim Webb, and Van Nuys Airport Director Paul Herrera to present the Friendly Flyer Award to Clay Lacy Aviation.

Throughout Clay Lacy facilities, including Orange County, California, and Waterbury-Oxford, Connecticut, it has:

• Sourced one-third of electricity from renewable sources.
• Transitioned 100% of ground equipment to electric or renewable diesel.
• Prevented 65,000lbs of carbon emissions through e-recycling program.
• Avoided 6.7t of carbon emissions through EV charging network.
• Sold more than 200,000 gallons of Sustainable Aviation Fuel (SAF).

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George J. Priester Aviation has expanded its customisable jet card programme, the 1945 Card, to include all company brands.

“Answering nationwide demand for greater charter flexibility”, the card programme expansion offers custom pricing to fit each client’s mission profile, available for flights on any the company’s family of brands.

“The 1945 Card meets the needs of the individual better than other charter options,” said Rustin King, National Charter Sales Director. “Travelers discover greater flexibility with no blackout days or peak-day surcharges. They’re easily scheduling an elevated flight experience, while locking in cost certainty that works well with their specific mission.”

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The deal, which will improve company’s liquidity position, is an extension of a $650m syndicated credit operation announced in October 2022.

The Brazilian firm obtained a revolving credit facility of $650m in October of 2022, as well as a credit transaction guarantee of $100m by JP Morgan and UK Export Finance to finance suppliers.

“The extension of a significant syndicated credit line reinforces Embraer’s liquidity for the next five years, providing important support for our long-term strategy. Our partnership with strong and marquee financial institutions reinforces Embraer’s credit quality,” highlighted Antonio Carlos Garcia, CFO, Embraer.

The syndication was led by PNC Bank, Crédit Agricole, Citibank, and with the participation BNP Paribas, Mizuho, Bank of America, Sumitomo Mitsui Bank Corporation, Natixis, JP Morgan, MUFG, Santander, Banco do Brasil, Commerzbank, Morgan Stanley, Bradesco, and Goldman Sachs.

The company said the extension of the credit line will be used by Embraer’s subsidiaries in the US and the Netherlands.

Earlier this year, S&P Global Ratings raised Embraer’s rating from “BB+” to “BBB-” and maintained a stable outlook citing the company’s strong cash generation amid higher aircraft deliveries. 

Embraer delivered 27 executive jets in the second quarter of 2024 up from 18 in the first quarter of 2024 but lower than 30 in the same period last year. The company’s backlog stayed flat at $4.6bn in comparison with the first quarter of 2024.

Embraer’s average loan maturity at the end of first quarter of 2024 decreased to 4.4 years compared to 4.6 years in the preceding quarter of last year. The term structure of loans was 96% in long-term contracts and only 4% in short-term ones.

In terms of cost of loans, the company’s cost of USD denominated loans decreased to 6.19% per annum in 1Q24 from 6.33%pa in 4Q23, while the cost of Brazilian real-denominated loans decreased to 6.69% compared to 7.11%, respectively.

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The research, which surveyed 1,000 full-time c-suite executives and senior management, revealed a significant increase in private flight usage due to its flexibility, efficiency, and peace of mind for travellers. 37% of respondents reported traveling monthly for business, with 77% using commercial flights as their main mode of transport. 

More than one third of respondents identified a significant desire for peace of mind when travelling. This was described as eliminating layovers, never losing bags, going straight to the plane, avoiding cancellations and delays. 

However, 75% of respondents identified cost as the main deterrent preventing them from using private aviation for travel. The second most important deterrent was a perceived lack of information on services and the industry, selected by about 41% of respondents.

“This survey was an opportunity to hear from folks who want to be our customers,” said Cory Bengtzen, CEO and founder,  SkyShare. “How can we meet them where they are? All business leaders would love to fly private, but there are still a multitude of hurdles to overcome, with cost being the most significant hurdle.” To address these concerns, travel solutions must cater specifically to the unique needs of today’s business leaders, he added.

“Approximately 62% of respondents indicated they are likely to consider private aviation for business travel needs, so the desire is absolutely there,” said Bengtzen. It is the industry’s responsibility to come up with new ways to provide a lower-cost option to help these leaders achieve their business’ goals, according to the company. SkyShare is doing that through flexible pricing plans and initiatives that lower the barriers to entry, said Bengtzen.

Since summer began, the appetite for private jet flying had been sharpened by the airline industry being “ravaged by a slew of technical malfunctions, emergency landings, and lost baggage woes”, claimed the company. So, it would not be surprising to see more business professionals considering and ultimately choosing the benefits of private aviation, it said. “For those who do fly private, reduced stress and hassle was a key factor in their decision to do so, which is why the commercial airline industry could soon see a significant shift in the sheer number of fliers,” predicted Skyshare.

Meanwhile, in May, SkyShare revealed a new financing programme for its fractional aircraft ownership plans aimed at lowering the entry barrier for small to medium-sized businesses. 

SkyShare survey results – at a glance

• 84% of C-suite exec and senior business leaders are interested in flying private

• 75% cite cost as the main barrier to adopting private aviation.
• 77% prioritise time-saving benefits, while 74% value increased scheduling flexibility.
• 69% appreciate reduced stress associated with private flights
• 35% highlight the importance of spending more time with family.

Source: SkyShare.

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Mosca joined the boutique acquisitions and brokerage firm in July after 20 years in leadership roles at General Electric, Textron Aviation, General Motors and other technology ventures.

 He joined Textron Aviation in 2012 as regional sales director for South America where he was responsible for sales of Citation and Beechcraft aircraft.

In 2016 he joined General Motors in South America to lead the automotive connectivity business in the region.

READ: IADA foundation awards 10 industry scholarships

As an entrepreneur he has invested in and advised start-ups in disruptive technologies with a focus on advanced air mobility and zero emissions.

SOLJETS, headquartered in Park City, Utah was founded in 2015 by Matt Stringfellow, Greg Oswald and David Lee.

It claims to have closed more than 400 aircraft transactions in more than 30 countries.

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Pop singer Taylor Swift and businessman Elon Musk have both been the subject of social media accounts—created by a University of Florida undergraduate named Jack Sweeney—dedicated to tracking their aircraft movements globally, with tens of thousands of followers on each account. Both also threatened legal action against Sweeney for his actions.

Arguably, Musk bought Twitter at least partly to remove Sweeney’s account from the platform. Musk initially cited “free speech” as the main motivation behind his acquisition of Twitter and pledged not to ban the account, but a month after the transaction closed, so did ElonJet. The Tesla CEO had also previously offered around $50,000 to the holder of the account to cease activity.

Whilst many will say the impact on Musk, Swift, or any celebrity’s flying habits is negligible, examples of aircraft tracking affecting business are not uncommon. One of the most infamous tracking incidents took place in 2019, according to Gitman, when Occidental Petroleum CEO Vicki Hollub took a company aircraft to Omaha, Nebraska—the home of Berkshire Hathaway CEO Warren Buffett. The Tuesday after, Berkshire Hathaway announced it would take a $10bn preferred share stake in Occidental, contingent on its acquisition of Anadarko Petroleum succeeding.

“Sure enough, Occidental visit on the Saturday, and by the Sunday people are making stock bets because that is what the stock market does,” Gitman told CJI. “In my opinion, that incident and others like it—think about the movie Wall Street—they’re more important than Elon Musk or Taylor Swift. When I speak to my colleagues in investment banking or financial services, they tell me they do this regularly.”

However, if someone lands at London City Airport, it doesn’t mean they are about to buy Citigroup. It is more often than not an educated guess when tracking an aircraft, made more or less sure depending on certain variables such as airport remoteness—there is a lot more going on in London than Omaha.

Other than chartering or fractional programmes—Buffett only flies NetJets—Gitman said there is “very little” that can be done to prevent the public from tracking aircraft movements. “Once you own an aircraft and people know you own it, then it can be tracked. These days it takes as little as a pilot putting a selfie on Instagram.

“If you want to avoid tracking, if you don’t want people knowing where you’re going, you’ve got to charter an aircraft in my opinion.”

The FAA’s Reauthorisation Bill published in April is giving owners more defence against trackers through a new law which will soon come into effect. The law will enable aircraft owners to apply to censor all identifiable information except “for physical markings required by law” by “attest[ing] to a safety or security need” through an application programme.

After the announcement, Sweeney reacted on social media: “Let this be said that this doesn’t prevent us from tracking jets. We can still figure out who’s who via context clues.”

Previously, there were some regulatory measures in place to make it more difficult for aircraft to be tracked. Firstly, the FAA’s Limited Aircraft Data Displayed programme enables owners to request the agency tell third-party flight tracker services to withhold information like call signs and flight numbers. Also, the Privacy International Civil Aviation Organization can block some flight information from being broadcast across unencrypted aircraft transponders.

Gitman agrees with Sweeney that the new regulation will not change much. “It changes a few points around the disclosure of ownership. But Taylor Swift doesn’t own her aircraft in her name, Elon Musk doesn’t either, I am sure nobody does ever. People are not connecting the jet to the person through the trust or the corporation. They’re doing it because there’s a picture of him getting off this plane. Once you have that, you know who owns the aircraft.”

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Wortmann said: “I am very pleased to be taking over as managing director of the DC Aviation Group and to be continuing the company’s success story together with Marc Ambrosius and the entire DC Aviation team.” The business continue to offer customers “first-class services and actively shape the future of business aviation,“ she said.

Ambrosius added: “It is a great pleasure for us to welcome Svenja Wortmann as a new member of the Management Board. Her extensive knowledge and passion for the industry make her the ideal candidate for this important position.” Wortmann’s commitment to excellence and innovation will be “instrumental in driving the growth strategy of the DC Aviation Group”, he said.

Joining the company in 2007, Wortmann has held various management and sales positions within the group most recently as authorised signatory.

Meanwhile, Stuart Burrows, authorised signatory and member of the Extended Executive Committee will continue in the role of accountable manager.

The company was formed out of DaimlerChrysler Aviation in 2007, a subsidiary of DaimlerChrysler AG founded in 1998. Offering aircraft management, maintenance, executive charter and FBO and handling services, the business covers the European region as well as the Middle East, India, Pakistan and Africa. Headquartered at Stuttgart Airport, Germany, the company also operates from locations in Dubai, Malta, Munich and Nice and San Marino.

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The process sees the aircraft modified from the most commonly configured eight-passenger layout to accommodate 10 passengers. West Star has completed 10 projects of this nature to date.

George Euler, Corporate Aircraft Interior sales manager, said: “I’ve had the pleasure of reconfiguring several Falcon 2000’s. It starts with our 3D designers and quickly engages our engineering team, allowing us to unleash our creativity. By focusing on the customer’s needs, we tailor the design to meet their operational requirements. We provide the additional seating capacity that is crucial for charter companies. This process ignites creativity, enabling us to innovate and achieve amazing outcomes.”

Floor plan reconfigurations are no small task, with several elements needing to be modified or replaced during the course of the work, according to the company. For example, a typical eight-passenger layout would include a forward four-place club arrangement and a conference group set up in the aft section of the cabin. This area would also have a credenza or kibitzer that is located on the right-hand side.

This credenza is removed and replaced with new aluminum plates mounted in the floor to pick up the existing seat track line. This allows new seat tracks to be installed that are narrower, to accommodate the new narrow-style seats in the area.

Next a new set of narrow-style double conference seats are installed on the left-hand side of the cabin. In most cases, the existing conference table can be used. The table will likely need to be modified in order to allow for egress requirements. Once this equipment is fitted and installed, a new side-ledge and table assembly is built and installed on the right side for the new narrow-style club group.

There are several key cost-driving elements to consider when planning for the 10-passenger configuration change, according to West Star. “Providing your technical sales manager with as much information as you have available at the initial request will expedite their ability to provide you with an accurate proposal. Though it would be great to be able to provide a firm price for the reconfiguration without much detail, each aircraft is like a snowflake—they are rarely identical,” said a spokesperson for West Star.

Some of those elements include a need to obtain the part numbers of the existing four-place club grouping to verify whether the seats that are being retained have been dynamically tested with the new narrow seating. 

Then West Star will determine whether the aircraft has an existing flight data Rrcorder (FDR) and then confirm that the FDR complies with the additional passenger requirements. The company says technical sales manager will need to understand which oxygen bottle is installed for capacity purposes and whether it is positioned in the existing credenza, or outboard, or below the entertainment cabinet. New switching is typically needed, so the existing cabin management system will need to be considered for either modification or upgrade.

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