Story ID: 081FlexjetAINJan13EditedByAY_NM
New Flexjet Boss Continues ‘Stealth Wealth’ Chase
By: Mark Huber
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Word Count: 701
The nation’s third-largest fractional jet program will continue to pursue a “stealth wealth” clientele while offering them customized solutions to their private aircraft travel needs beyond traditional fractional sales, and that may mean bringing more capital into the company, according to Flexjex president Deanna White. 
  
“You’re talking [about] moving from a mix of products where the customer owned the asset in the fractional model versus more products where Flexjet becomes the owner of the investment to provide a lease or a jet card. You have to look at how the company is structured to finance that to remain one step ahead of the customer’s needs,” White said. She said the capital could come from Bombardier or “some other facility.” 
  
White took over Bombardier’s fractional, jet card, charter and aircraft management program as president on October 22. She joined the company in 2005 and most recently was its vice president of finance. Flexjet was founded in 1995, currently operates a fleet of 83 Bombardier aircraft, and employs 700, including approximately 300 pilots. Aircraft range in size from the Learjet 40 to the Challenger 300–its most popular offering, with 31 of those super-midsize aircraft in the current fleet. The company is based in the Dallas suburb of Richardson, Texas. Flexjet has remained the nation’s third-largest fractional program over the last decade, behind industry pioneer and leader NetJets and second-ranked Flight Options. 
  
White said Flexjet will continue to offer customers a wide array of services through its partnerships with international airlines and various upscale brands. She joined Flexjet from the rapidly changing telecommunications industry and sees some parallels between it and the corporate jet business. “Since the boom of 2007, a lot of niche players [have come] into the market and you are seeing a shift in how people are flying privately, the different products that they want. Fractional ownership still provides value for customers who want to get low operating rates, but we’ve had success with our jet cards, debit cards, leases, on-demand charter and discounts for long-haul products. So you are seeing a shifting of how people procure jet services.” 
  
White said fractional ownership remains the core of Flexjet’s business, accounting for 70 percent of revenues, but an increasing number of customers “do not want to make the capital investment and are using different products such as cards and leases. We have a solution for every customer, including leases with 90-day cancellations. We can keep customers who opt out of fractional programs with other choices.” 
  
Fractional owners also have more choices, White said, including the company’s FlexShare program, launched at the NBAA Convention last fall, that allows them to fly in more than one type of aircraft. “There will always be businesses and individuals with an appetite for capital investment,” she said. However, she noted that potential tax-law changes eliminating “bonus depreciation” for private aircraft purchases could have a chilling effect on the industry in the short term. “I hope government will address bonus depreciation for all capital investment as opposed to just targeting business jets. We need more capital investment in the United States and it is very important that we have features like bonus depreciation [in the tax code].” 
  
White said that her sales force is well versed in the intricacies of tax and other financial mechanisms needed to structure transactions to conform with customer needs. “Our customers are, for the most part, entrepreneurial and self-made. They tend to dive deeper into the details when they are shopping for this type of purchase and take a hard look at the value they are receiving. They do their homework,” she said. “We don’t have many celebrity customers. We have more of the stealth wealth customers, and our sales force needs to be educated in the value proposition of Flexjet.” 
  
White said customers are responding positively to new aircraft models from Bombardier, including the Learjet 85, with four whole aircraft sales so far. She said the company has also sold one whole new Learjet 70, an updated variant of the Learjet 40XR. “Next year is really going to be an exciting year for us with the new aircraft types.”