What is seat selling, and how does it work?
Seat selling vs private charter: Private aviation is a privilege that may not be affordable to everyone. Chartering an entire aircraft or owning a private jet requires a particularly wealthy status. While most charter customers prefer to fly alone or with their family, a new option is available. Some adventurous aviators have created a charter model for luxury enthusiasts. It allows them to upscale their travel to a private jet for a fraction of the price through single-seat sale.
For most of us, experiencing private aviation on a regular basis is not a realistic idea. However, some jet companies in the USA and Europe have offered such opportunities either on individual flights or via membership. Although it is quite close to the real luxury charter trip at a much lower cost, for an aircraft owner and broker in the GCC like ASM, the “buy a seat model for private travel” misses a couple of key benefits.
Private Charter
Charter flyers consider the ultimate comfort of luxurious private jet interiors, dedicated, individualized service, and the highest level of privacy essential. A client expects a private jet made at their disposal, flying to their requested destination. In reality, by purchasing a single seat on a private jet, they will have to travel on a set schedule like a commercial airline flight, sharing the flight with unfamiliar people.
The seats sold in charter allow a more luxurious setting, fast-track immigration procedure, and arrival to or exit from the airport through a smaller, more convenient FBO terminal just minutes after arrival. On flights of less than 1.5 hours, charter seat travellers can cut the total travel time in half. Moreover, in some cases, the single-seat charter concept allows more flexibility to divert flights to a less busy airport, meaning landing closer to the desired arrival point and avoiding customs delays at major airports.
In Europe, all-you-can-fly monthly charter memberships can cost about the same as a business class ticket on a commercial airline. Either way, it is a lot less than chartering the entire plane. Nevertheless, it is unlikely that private jet owners or regular charter flight users in the GCC, particularly in the UAE, would appreciate the idea of sharing when they can afford a private flight for themselves.
Is the business model sustainable? Are there legal and financial implications?
The attraction of paying as little as a few hundred dollars for a seat on a private jet or even a couple thousand dollars a month to fly as much as you want holds out the prospect of opportunity. However, this is only if the GCC conditions for single charter seat sale demand were to arise.
Serving routes that connect cities without any scheduled airline flights looks like a good idea. Yet, in the UAE or other Gulf countries with smaller territories, customers can simply order a car service or a helicopter, if necessary. Such service can be carried out easily.
Altogether, these more democratic opportunities to indulge in private flying do not necessarily have to be successful. Many USA and European private jet companies have tried the single charter seat model without success. This is despite the USA and Europe being the biggest private aviation markets in the world. The UAE is the major outbound charter broker market for ASM. It has regulative and geographical limitations.
Are seat brokers competing unfairly with ad hoc air charter brokers? Is it a matter of competition and opportunity, or is there a threat to security?
ASM does not sell by-the-seat. The portfolio of customers that we operate have a strong preference for complete privacy and service dedication to their travel needs. We primarily offer private aviation services in the GCC region, which is sensitive to wealthy individual requirements. We offer entire aircraft to our charter customers.
The company also assume the responsibility of the charter operators. We work with the FAA Part 135 regulation at use. Selling charter flights by seat would make the operator perform scheduled flights on a particular date and time. This is a violation of the Operator’s Certificate. It also puts an operator in direct competition with commercial airlines.
In other words, selling charter flights by seat in a particular region’s economic and regulative setting would not be ethical. It would also not present a competitive advantage to ASM Charter broker division.
If you sell seats, what questions do you ask the passengers and how do you assure their security?
It is a very complex situation to sell flights as a single-seat concept, which requires a secure process of seat booking, regulative infrastructure, policies and a fleet in place. Therefore, we don’t think that such a service will be in demand in the GCC in the near future.
How aware are clients of the different profiles and risks between private charter and seat selling?
A private charter is normally a business flight or a group of people who know each other travelling together. Taking out the concept of exclusive privacy and placing strangers to fly together on a smaller jet may raise security concerns for travelers. It may also have a deluding effect on the private charter exclusivity confidence.
Shared flight plans and personalized details of the trip not attributed to one key customer can easily upset a VIP customer. This can result in the loss of business.
We see vast opportunities in private aviation of GCC Charter brokering. It feels like the surface of the business travel was barely scratched. Introducing individual seat sales on a private charter market in GCC could potentially assess corporate travel. It could make fair competition to the business class on short-haul flights to neighboring countries. However, it is unlikely that single-seat sales will be applicable to the GCC region.
Priyantha Brito, Executive Director-Fuel & Special Projects at Aviation Services Management, provided this commentary to the Charter Broker Magazine in March 2019.
Article published in April 2019 issue of the Charter Broker Magazine, available here.
For further information, please contact:
Aviation Services Management FZE
Suite 217, 8WB, DAFZA, Dubai, UAE
Tel: +971 4 4097755
Email: sales@asm.aero
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