Lingering health concerns about commercial air travel during the COVID-19 pandemic have fueled a surge in private jet travel in the USA.
The multibillion-dollar federal bailout rescued businesses hit by the coronavirus, including billions for airlines stranded due to travel restrictions and safety concerns. According to a report, the pandemic also hit more than half a billion dollars for boutique aviation firms that provide private jet travel to the super-rich people.
Dean Baker, the co-founder of the progressive think tank Center for Economic and Policy Research, told ABC News that the people are subsidizing the luxury consumption of rich people in the country as the bailout money given by the government is of the taxpayer.
The industry experts earlier predicted that private jet operators, like commercial airlines, would face significant revenue cuts. Executives at private aviation companies also said they needed the government’s help to keep their employees on the job. However, several of the same executives openly stated that they saw evidence of a coming boom, spurred by fears of a COVID-19 pandemic.
That prediction has come true, and the once-niche industry transformed into an overnight sensation. Thanks to people willing to spend up to $20,000 for a flight across the country. According to industry observers, the popularity of private aviation has now surpassed that of pre-pandemic levels.
Travis Kuhn, vice president of market intelligence at the aviation consulting firm ARGUS International, said that private aviation recovered faster than many other businesses, including airlines. Currently, private air travel is about 15% larger than it was two years ago — and it is almost all directly attributed to the pandemic.
According to aviation data research firm Wingx, there were 3.3 million flights that traveled around the world in 2021, the most on record. This was a 7% increase over the previous high in 2020, with the United States and Europe leading the way.
Kuhn said that wealthy Americans discovered the time-saving and productivity advantages after flocking to private aviation for the perceived health advantages of avoiding crowded airports and commercial planes.
Also, passengers traveling in a private jet do not even need to enter a terminal building in many circumstances. Instead, the limousine pulls up alongside the plane on the tarmac. Passengers only have to rest in a plush leather armchair, and a cheerful member of the cabin crew will give you a drink of champagne, he added.
Funds collected in 2021
According to a study by Accountable.US, a government monitoring group, in 2021, private aviation firms collected up to $643 million in government funds from the Payroll Support Program, the Paycheck Protection Program, and the Economic Injury Disaster Loan Program for small businesses. The Payroll Support Program’s subsequent iterations delivered considerably more funds to the private jet sector.
The overwhelming majority of funds delivered to private aviation firms came as grants that did not require repayment as long as recipients did not engage in involuntary furloughs or terminations of employees. However, some critics urge fast-recovering companies to repay some of the funds.
Kyle Herrig, the president of Accountable.US, said that many private aircraft companies are celebrating increased wealth and opportunity these days, regardless of government assistance. He urged taxpayers to pay taxes back.
Among the biggest bailout recipients, OneSky Flight, an Ohio-based commercial aviation portfolio that includes brands like FlexJet, Sentient Jet, and PrivateFly, got $81 million from a fund set aside in the Coronavirus Aid, Relief, and Economic Security (CARES) Act to assist airlines. Other commercial aviation like FlexJet, Sentient Jet, and PrivateFly received more than $50 million each.
OneSky executives have described the company as catering to a high-net-worth clientele, primarily corporate clients and frequent wealthy flyers. Celebrity clients, including astronaut Buzz Aldrin and golfer Bubba Watson, have endorsed the companies on social media, as well as references to their support of thoroughbred horse racing and an annual snow polo tournament in Aspen.
When OneSky approached the federal government for bailout funds, the company executives emphasized the need for funds for their pilots and flight controllers.
Dan Hubbard, a spokeswoman for the National Business Aviation Association, said these companies like OneSky request federal funding for the same reason as many other small businesses did to keep employees on the job. She also said this crisis-moment investment worked — as it has in other industries — supporting employees and paving the way for their companies’ gradual recovery.
However, critics argue that private aircraft operators could have afforded to assist their staff for a limited period if they anticipated that business would rebound, as several industry officials openly stated at the time.
According to Steve Ellis, vice president of Taxpayers for Common Sense, the success of these companies so soon after accepting government support, which also undermines the spirit of the programs. He said during the pandemic private aviation industry profited from greater interest. Thus, they got taxpayer money, and business skyrocketed.
Despite the criticism, several industry insiders believe the private aviation stimulus was necessary. Private jet operators, just like well-known commercial airlines, saw a major income decrease during the peak of the pandemic, from mid-March to May 2020.
Doug Gollan, the editor of Private Jet Card Comparisons, a blog covering the world of private aviation, said that the industry’s success now is a sign of how successful the CARES Act was in getting these businesses back on their feet.
Gollan explained that the funds were intended to assist businesses in navigating the crisis. He said that the CARES Act made private aviation the poster child for success stories.
Kenn Ricci, the CEO of OneSky Flight’s parent company, recently told Bloomberg Media that business has improved, and he also plans to increase his fleet by 40% in the coming year. The recent success of private aviation has caused the demand for new aircraft to drastically outpace the supply.
Rising consumer demands
JetClub, a private aviation company, claims they are having trouble getting enough new planes to meet demand. Vishal Hiremath, the company co-founder, said they need additional airplanes, but their OEM (original equipment manufacturer) partners can not make enough.
The experts predicted that one issue that may start to dampen demand for private planes is rising fuel prices. The passing on to passengers of the large increase in the cost of aviation fuel because of the ongoing crisis in Ukraine – could start to affect demand for private flights. Jet fuel is currently more than twice the price it was last year.
Justin Crabbe, chief executive of Jettly, a technology company making private air travel accessible through a mobile app, said that they do not know how high the fuel prices will soar. But he believes it will be very impactful on the market.
On the other hand, private jets have never been inexpensive. Users can typically deduct these from their company expenditures rather than paying out of pocket. Crabbe said if one wanted a private jet to fly six people from London to Ibiza, it would cost around $28,000 (£23,000).
Environmental impact of Private jets
US firm JSX Spokesperson, Benjamin Kaufman raised a question about the environmental impact of private jets. According to the cleaner transport campaign group Transport & Environment, private jets are five to 14 times more polluting than commercial airlines on a per-passenger basis.
The private plane industry counters that it encourages passengers to carbon offset. Some companies are also experimenting with biofuels and electric, hydrogen, and hybrid aircraft.
Ian Moore from VistaJet said his company is committed to becoming carbon neutral by 2025. He said the company had established a sustainability project under which over 85% of members offset CO2 emissions relative to their flights’ fuel consumption.
However, Anna Hughes, director of Flight Free UK, is not convinced. Her organization urges people to make a year-long promise not to fly.
She said people should do everything to reduce emissions and question whether private jets are an appropriate form of transport.
According to her, no offsetting scheme can make up for the huge emissions of taking a private flight. She said that trees take a long time to grow, but flight emissions are immediate. She also said that the most reliable way to reduce emissions from flights remains the simplest one – fly less.