Demand for executive aircraft charter continues to be softened by depressed trading activity in the financial community, which has previously been a core market for corporate jet operators. The world’s two leading executive charter brokers, Air Partner and Hunt & Palmer, say they have preserved revenues over the past 12 months only by diversifying geographically and by attracting new business. Both told AIN that profit margins for brokers and operators alike have remained tight.
UK-based Air Partner’s profitability actually climbed by 85 percent in the financial year ending July 31, due largely to increased demand for chartered airliners. Pre-tax profits reached £2.2 million ($3.3 million) and revenues were up by 13 percent to £100.7 million ($151 million).
An Air Partner executive charter broker told AIN that “the financial business is still gone” and that this had been the core market for midsize business jets. In some instances, charter rates have dropped by 30 percent or more as operators scramble to find work. The same broker said that when he asks for quotes he now gets “dozens of bids within minutes,” whereas in better economic times he has had to chase bidders for a day or two.
London Gatwick Airport-based Air Partner has opened new offices in Washington, D.C., and Dubai, United Arab Emirates, over the past year. It is now seeking to relaunch its Business Jets joint venture with British Airways after this was put on hold in the immediate aftermath of September 11. The operation is intended to provide executive aircraft to connect with BA scheduled flights.
Hunt & Palmer’s corporate development director, Jamie Martin, confirmed that the depressed stock market is still impeding a full recovery in the executive charter market. “The real low point was last year, but profit margins have been bad since then and several operators have gone out of business,” he said. Nonetheless, by expanding internationally into regions such as Russia, the London-based broker now sees business picking up and expects to achieve 25-percent revenue growth this year.
Last month Hunt & Palmer launched a new specialist aircraft charter brokering service, called CloudNine, for professional sports teams and individuals. It is also seeing increasing demand for its emergency evacuation package, which helps companies to develop plans to get their employees home from international trouble spots.