Great Expectations Not Met for Very Light Jet Usage

Three years ago the very light jet was going to change business aviation. The four- to six-seat planes cost less to buy and operate than other private jets and were much quieter too. Media coverage contributed to an image of a time 10 years hence when a thousand small planes would zip around the country primarily as air taxis, a shared service that would drop the cost of private air travel. Honeywell Aerospace forecast deliveries of very light jets at 1,900 by 2015 and revised the figure to exceed 3,300 aircraft by 2017. The great expectations, however, never materialized. Eclipse Aviation, the most well known of the VLJ manufacturers, filed for bankruptcy last year after making fewer than 300 of their Eclipse 500 jets. DayJet, one of the larger air taxi firms, ceased operations in September and has its fleet of aircraft on the market. Despite these setbacks, the very light jet market thrives at Van Nuys Airport and other Southern California airfields serving general aviation. Divorced from the air taxi concept, the benefits of these jets focuses on the lower purchase and operating costs that give access to private aviation to those who otherwise couldn’t afford it. In that respect the expectations have been met, said Cyrus Sigari, co-owner of JetAVIVA, a very light jet brokerage and services firm in Van Nuys. “It is still cool to own a VLJ,” Sigari said. “It is not so cool to own a $20 million, $30 million jet.” JetAVIVA works exclusively with the small jets, giving assistance in the purchase, delivery and flying of the aircraft. It has put clients into the Eclipse 500 and the Cessna Citation Mustang. In March, the company takes delivery of what executives claimed is the first Embraer Phenom 100 very light jet in the U.S. to sell on behalf of a client. Embraer is the latest player in the VLJ field a field expected to grow in the next couple of years as other manufacturers including Honda and Cirrus – receive certification for twin-engine and single-engine very light jets. Not even Eclipse is totally out of the picture. The assets of the company are expected to be bought by a new venture, EclipseJet, which includes as an investor Alfred Mann, owner of medical device and biotech firms in the Santa Clarita Valley. By making these small, less-costly jets, the manufacturers create brand loyalty at an earlier stage. When the owners are ready to move up, these same companies will have larger planes waiting for them. Before VLJs, getting into private aviation in the $3 million range required buying an older, used jet that was probably more than what the owner needed. Now for the same price, an owner can get a brand new plane with the latest technology. “As a result you are getting more new entrants that otherwise wouldn’t be here,” Sigari said. With the global economy in the toilet and business aviation smarting from the black eye of chief executives from the Big Three automakers flying to Washington, D.C. to request a bailout, are there takers for these aircraft? Historically, the business aviation industry has lagged in both suffering the effects of a slowdown and seeing an upturn during a recovery, said Jeff Kohlman, a principal with Aviation Management Consulting Group. Once the economy rebounds, business aviation will lag behind by anywhere from six to 18 months. “Buying new planes is last on the list of companies and individuals recovering from a slow economy,” Kohlman said. Business people who find value in flying privately will find ways to do so, as Randall Sanada has seen at Jet-Alliance in Westlake Village, which operates out of airports from Camarillo to San Diego. The firm started out selling fractional-ownership stakes in very light jets and with an expanded fleet now offers charter service for clients who are giving up flying in larger planes. The efficiency of the very light jets makes for an affordable trip, Sanada said. Auto industry CEOs wish they had flown an Eclipse or Mustang aircraft for their visit to the Capitol. “Had these guys flown together in a VLJ it would have cost less than a tenth of what it cost in a larger plane,” Sanada said.