New NetJets chairman and interim CEO David Sokol has begun making changes at NetJets Europe, appointing a new boss to run the business and implement job cuts at its headquarters. Eric Connor has been appointed the new CEO and chairman of NetJets Europe following the October 4 resignation of CEO William Kelly “to pursue his own interests.”
Flexjet, Bombardier Aerospace’s fractional-share program, announced a reconfigured product offering at NBAA, with an emphasis on its ability to offer supplemental lift and other aviation solutions to corporate flight departments.
The fractional share marketplace is changing rapidly in response to the lengthy global recession. While most fractional operators already reduced staffing levels to match lower levels of customer activity, it wasn’t until September 11 that NetJets announced layoffs of 350 nonunion employees.
The recession has dealt an enormous blow to the fractional share industry. Rapidly declining used-aircraft prices and fewer flying hours have affected the industry to the point that most fractional operators have shrunk during the past year, deferred new aircraft deliveries, cut staffing and explored new ways to keep flying. Business has been so bad at the fractionals that some pundits are questioning whether the business model is broken.
According to the management of Jet Republic, the overriding reason that the company suddenly ceased trading on August 20 was because “the aviation asset finance market has completely dried up, making it much more difficult for potential clients to take out and obtain financing for fractional ownership of jets.”
Shortly before the departure of NetJets chairman and founder Richard Santulli, NetJets Europe achieved its goal of reducing flight crew capacity by 60,000 pilot duty days per year in response to declining demand for its fractional ownership and block charter services.
Lawyers acting for European private jet club start-up Jet Republic are seeking to lift a legal injunction secured by rival fractional ownership provider NetJets Europe that has prevented it from hiring NetJets employees. A Portuguese court granted the injunction in July last year, three months before Jet Republic was officially launched.
In a seismic event for the business aviation industry, NetJets founder, chairman and CEO Richard Santulli yesterday resigned his position at the company, effective immediately. Santulli, credited as the “father of the fractional aircraft industry,” said he will remain with NetJets–a Berkshire Hathaway company–as a consultant for at least a year.
NetJets Europe has achieved its goal of reducing flight crew capacity by 60,000 pilot duty days per year in response to declining demand for its fractional ownership and block charter services.
With certification of Embraer’s Phenom 300 expected before year-end, Flight Options released more details about its fractional ownership program for the aircraft in June.