OneJet Positions for Growth with Fred Reid on Board

OneJet, eying a continued expansion of its middle-market scheduled services using business jets, has added veteran airline and business aviation executive Fred Reid to its board of directors. Reid, whose resume includes Delta Air Lines, Virgin America and Flexjet, will help guide the company as it explores new small and midsize regional markets throughout the U.S. The role formalizes a year-long relationship in which Reid has acted in an advisory capacity.

OneJet launched its services a little more than a year ago, initially offering flights from Milwaukee to Indianapolis with Hawker 400XPs that are flown under Part 135 with Part 380 economic authority. The company, which president and CEO Matthew Maguire says is more of “a next generation scheduled product...than it is a charter or a business jet service,” has since added Pittsburgh as a base of operations and routes to Hartford and Louisville with plans for Raleigh and Kansas City.

Reid noted that it was the opportunity to build the regional services that lured him to OneJet. “To me, what's attractive is not so much the ‘business jet’ element as it is the massive commercial opportunity opening at the moment in the regional travel segment. It's just absolutely tremendous,” he said. “The recent years of consolidation and resulting capacity right-sizing by the major airlines have created a ripe environment for this type of service.”

For Reid, the predictability of the scheduled approach provides cost efficiencies. “The uncertainty associated with traditional on-demand operations drives a huge amount of cost and throughput constraint for the typical business aviation operator,” he said. “OneJet's scheduled operations, while using business jets, allow us to apply scheduled airline practices to maintain reasonable cost.”

Fares can run as low as $250. “It’s a simple proposition: we are providing the only nonstop service in the markets we serve and are doing so with an economically feasible capacity plan,“ he said.

“There is a substantial need for regional nonstop service,” Maguire agreed. OneJet services are designed for direct routes that are less than 700 miles and in markets that can support between 20 and 80 passengers a day, but have limited airline options. The idea, Maguire said, is “to get people to their destinations in 45 minutes to an hour rather than four or five hours.” Maguire believes there are as many as 900 city pairs in the U.S. that can support that model.

OneJet sells service on a per-seat basis through its own booking engine or through services such as BCD Travel or Carson Wagonlit Travel. Under its model, the company operates out of main terminals. Maguire said the company decided early on to invest the time and money to receive the same Transportation Security Administration credentials as all the major airlines. The decision was made at the behest of the OneJet’s target market, corporations and business jet travelers. Since the service is sold per-seat, corporations “wanted the people to have the same security standards as commercial airlines,” he said.

While there is an additional cost to operate out of a main terminal, the locations chosen typically are looking for additional service, have empty gates and have been willing to work with OneJet on the service, he said.

Corporate Flight Management, which is an approved Part 135 commuter carrier, operates the flights for OneJet. It took over those operations from Pentastar in June.

The company is looking to grow slowly. As such it is making adjustments along the way. OneJet put plans for Nashville and Memphis on hold, for instance. “We want to be prudent,” he said. It has four Hawker 400XPs and expects to add a fifth aircraft in October, with plans to add one every “one to two months thereafter,” Maguire said. While the company is always considering other aircraft options, the Hawker 400XP—with its low acquisition cost, wider cabin and operational capabilities—fits the OneJet model and likely will make up the fleet at least through 2017, he said.

The company is also looking to add new markets to connect to its Pittsburgh base this year, but has a longer-term vision of having five to seven “focus cities,” where OneJet has based aircraft and serves multiple destinations from that base. While not yet ready to detail those locations, Maguire said the company is in active talks on three of those locations.

While looking to add locations, the company also is focusing on “customer experience,” bringing on amenities such as Wi-Fi.