A rising number of insolvencies within the aircraft charter industry and an increase in private jet bookings among business travelers will be among the developments in 2021, according to global broker Air Charter Services (ACS). “We are already seeing a reduction in marketing spends from these [charter] companies who often portray the results of heavy marketing investment, as well as loss-leading pricing, as illustrations of the success of their business model to generate new investment,” said ACS group private jets director Andy Christie. “Without the new customers generated through these strategies, the rate of growth will slow and, for some, that will mean serious cash flow issues, which may lead to insolvency.”
ACS also expects private jet travel bookings this year to return to 2019 levels through a combination of increased business travel—returning to 85 percent of 2019 levels—and leisure travel. “As companies re-engage with the world, they will find that disruption to scheduled services will make business itineraries difficult," Christie explained. "As a result, businesses will start to turn to charter despite the inevitable economic problems that the world faces.”
Continued disruption in commercial air service will lead to additional first-time private air travelers who will travel less frequently but take longer trips. In 2020, ACS recorded a 25 percent increase in new customer bookings. “Following months of lockdown, people can’t wait to travel again and are wanting to go on trips for a longer duration to make the most of their time in a destination,” Christie noted. “The introduction of remote working arrangements is also likely to contribute to the increase in the number of people traveling for longer.” Those first-time private jet travelers are also more sensitive to carbon offsetting and will drive an increased uptake in carbon credits, according to ACS.
Mexico and the Caribbean will remain popular destinations among American travelers in 2021 because of their proximity and continued Covid-19 travel bans and border closings among other international locales.