In a major management shake-up at fractional provider NetJets, company founder, chairman and CEO Richard Santulli on August 4 unexpectedly resigned, effective immediately. Credited as the “father of the fractional aircraft industry,” Santulli said he plans to remain with NetJets as a consultant for at least a year.
NetJets’ new chairman and acting CEO, David Sokol, has barely been at the helm of the fractional provider a week, but he isn’t wasting any time in restructuring the company that lost nearly $350 million in the first half of this year.
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.
Fractional aircraft provider NetJets’ second-quarter revenues fell 43 percent year-over-year to $550 million, and for the first half dropped $1.024 billion–or 42 percent–from the same six-month period last year.
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.
While the industry cheers small gains, on any given day the bits and pieces of good news (+) have typically been overwhelmed by the bad (-) as the economic crisis and credit crunch continues. Here’s a bit of both.
NetJets Europe has become the first operator permitted to fly the Falcon 7X trijet into London City Airport (LCY), which requires special approval for the downtown airfield’s 5.5-deg steep approach. The fractional ownership provider last year flew nearly 5,000 flights to and from the airport, making London City the fourth most popular destination in the operator’s fleet.
Going forward, Stephens said satellite communications will help, too, for example by allowing on-board WiFi to give broadband Internet access via SwiftBroadband. Universal also is working to integrate with third-party scheduling software “so that clients can run a flight plan within our software and then upload it to their aircraft.”
Revenues at Berkshire Hathaway’s services group–which includes fractional provider NetJets and flight-training provider FlightSafety International–were $8.435 billion last year, an increase of $643 million over 2007. Overall, pre-tax earnings at the Berkshire division last year were relatively unchanged from 2007 at $971 million, according to the company’s financial report issued late last week.