Pandemic Accelerates Directional’s FXAIR Launch
FXAIR, described as a provider of “premium on-demand charter,” was formally launched in late July, several months earlier than planned, as its owner, Directional Aviation, restructures its global businesses to better respond to post-COVID-19 opportunities.
The new company operated its first flight on July 28 after several months of sounding out potential clients.
The firm will be headquartered in New York and led by former XOJET and NetJets executive Gregg Slow. It is initially equipped with a fleet of 12 Bombardier Challenger 300 and five Global Express jets, all removed from fractional ownership and operated exclusively for FXAIR by sister Directional company Flexjet. FXAIR will also utilize what it calls “a network of individually curated premium aircraft from some of the industry’s most respected and safe flight providers.” Bookings can be made via a smartphone app, by phone call or online.
“We’re defining premium charter as second-generation former fractional aircraft,” says FXAIR President Slow, who moves to the company from the U.S. division of another Directional business, PrivateFly. “These are airplanes that have been flown in fractional for 10-12 years. We’re monetizing them for the next 10 years of their life cycle and using them in this premium charter model.”
Plans for the brand have been in the works for some time. But according to Andrew Collins—the new firm’s CEO and director of Directional’s jet-card and on-demand product portfolio, including Sentient Jet—the launch was brought forward because of increasing demand that the company is seeing across its brands. Those needing to travel and able to afford private aviation are turning to the sector as the lowest-risk option amid the coronavirus pandemic.
“Sentient sold the most jet cards it’s ever sold in its 20-year history in June, and then matched that in July,” he says. “A lot of folks are thinking about [private aviation] in terms of their choice for flying going forward. FXAIR was probably going to launch later this year or even the beginning of next, but we’ve been on the phone every day with new customers or people referring new business, so we moved up the timetable.”
The company believes it can build and retain a significant share of the growing market with a premium product, even amid the financial pressures that the pandemic is inevitably applying. In a statement released to announce FXAIR’s launch, Directional’s principal, Kenn Ricci, took issue with those in the industry who appear to argue that customers of first-class commercial seats can only be tempted into private aviation by lower prices.
“We hear that the rest of the charter industry is trying to ‘democratize’ private jets,” Ricci said. “We see it very differently. We see clients who appreciate the ‘private’ in ‘private aviation’ and aren’t willing to compromise on quality or safety. Once charter clients fly with FXAIR, they won’t want to go back—especially with the innovative enhancements we plan to implement in the future.”
“People are looking to see an expansion to the total addressable market, and I think we’re in that market right now,” Collins says. “We don’t look at it as ‘democratizing’ the market—we look at it as more of an expansion of the audience that’s receptive to private aviation. We’re looking to build a business that helps those folks, and isn’t necessarily trying to capitalize on a buzz phrase.”
In terms of numbers, Collins and Slow maintain there is a potential market formed by around 360,000 households in the U.S. with “addressable assets” of $10 million or more who could therefore afford to fly privately but currently do not. Not all of them will become customers, but many could be. The challenge is to turn those attracted to the sector during the pandemic from one-off clients to long-term customers, they said. Already, the signs are promising.
“What we’ve seen over the last couple of months is an enormous influx of that group,” Slow says. “In a typical month we might see 8-10% of our business coming from new clients, [including those who are] new to private aviation. But in June and July, we’ve seen 60-65% of our business coming from new entrants to private aviation.”