Air taxis have their meters running

Marketplace Staff Aug 18, 2006

KAI RYSSDAL: You get to the airport a couple three hours early. You’ve packed everything where it’s supposed to be packed. And generally gotten yourself ready for what won’t be a fun travel experience.

That kind of attitude has analysts guessing airlines might see a slowdown in the near future. But one part of aviation is flourishing. Charter planes and air taxis can be expensive ways to fly. But time is money in today’s go-go world. Jason Paur reports.

JASON PAUR: None of the big airlines has scheduled service to the King County Airport, just a few miles south of downtown Seattle. But plenty of former airline customers can be found here.

The airport is home to several chartered and corporate aircraft that fly customers on demand, and are especially popular for shorter flights in the region.

Peter Anderson is the president of Galvin Flying, a charter operator at the airport. He says last week the phone immediately began ringing after the new security threats. People were looking for an alternative way to get where they were going. And while Anderson says the spike was short-lived, the trend has been a clear one.

PETER ANDERSON: At Galvin Flying Services, we’ve more than tripled our corporate aircraft fleet since 9/11. We’re expecting to double it again in the next 18 months. Our problem now is not: having the customers and the phone ringing; our problem now is being able to add aircraft fast enough to be able to accommodate that demand.

Anderson says more and more people are looking into chartered aircraft as well as fractional ownership. That’s where a person or business buys a set number of annual flight hours from an aircraft operator.

And the customers aren’t just the stereotyped Fortune 500 companies.

Bill Connors is the director of the National Business Traveler Association. He says his group is seeing more and more small and mid-size companies expressing an interest in chartered and corporate aircraft.

BILL CONNORS: As more and more companies offer these services, the competition is out there and it becomes more affordable to even medium-sized companies. And again, if the hassle factors continue to increase rather than go the other way, I think you’ll see a continued demand for these kinds of services.

While some in the industry point to the security threats as one of the main reasons for the upswing in corporate and charter aircraft use, some analysts say the direct link is still hard to pin down.

Richard Aboulafia is an analyst with the Teal Group. He says as important as long lines and security threats might be, they don’t outweigh that most important of business decisions: money.

RICHARD ABOULAFIA: In the short term, changes to security arrangements or terror fears can result in an uptick in interest in private air transport. But the real demand for private air transport is driven by corporate profitability.

And most in the industry agree. As more valuable time is wasted with traditional carriers, making some busy travel schedules impossible to fulfill, chartered aircraft can actually look good on the bottom line.

In Seattle, I’m Jason Paur for Marketplace.

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