News

Private Jet Charters Enjoying Good Business

Air Partner is a charter company based in the United Kingdom.  Over the last month, their sales have jumped 60% with a profit increase of 188%.  In the last year, the stock has climbed by 30%.  The Air Partner business does not actually own any aircraft, but this has not been a hindrance to either their increase in business or their ability to attract new clients.  White House Press Corps members from the United States and even the Queen of England contract their flights out to Air Partner.

The CEO of Air Partner is David Savile and in an article originally printed in the Sunday Times, he spoke out about Air Partner’s major European competitor, a company known as NetJets.
 
According to Savile, "For once I think Buffett has got it wrong. Netjets has spent over $200m marketing in Europe . . . and we have benefited hugely from this. The difference is we make money and they don’t."
 
The facts seem to contradict this however, as Warren Buffet’s letter (written in 2006) suggests.  This is illustrated by the letter excerpt shown below.
 
"Our move to Europe, which began in 1996, was particularly expensive. After five years of operation there, we had acquired only 80 customers. And by mid-year 2006 our cumulative pre-tax loss had risen to $212 million. But European demand has now exploded, with a net of 589 customers having been added in 2005-2006. Under Mark Booth’s brilliant leadership, NetJets is now operating profitably in Europe, and we expect the positive trend to continue."
 
While the companies are involved in the same markets and are in direct competition with each other, it is not as close as most people assume.  Because of the differences in costs, contracts and management they each have a fringe niche that they play to.