Flight Options LLC didn't become one of the largest private jet operators in the world by staying one course — and it hasn't always been a smooth ride. In fact, the business model has been tweaked and refined since the company was founded in 1998. But eventually, this nine-time Weatherhead 100 winner got it right.
Flight Options began as a company that sold used aircraft, but it lost money every time some of the planes took flight, says S. Michael Scheeringa, CEO. By 2004, Flight Options was a $550 million-a-year business, but it was still losing almost $0.20 on every dollar.
"Used airplanes — although less expensive in acquisitions — were significantly more expensive to maintain and operate," Scheeringa says. "In November 2004, we made a very deliberate right turn and made the decision to sell just four types of airplanes — one light jet, one medium jet, one super mid and one large cabin. Those planes could service the needs of 96 percent of all of our customers' private jet flying."
Today, Flight Options is the only private jet operator in the United States to provide a complete spectrum of services under a single corporate umbrella — including fractional ownership and leasing, aircraft management, charter and JetPASS Ultimate Travel Membership. The company now has a fleet of more than 130 light, mid-sized aircraft, which consist of the Hawker 400 XP, Hawker 850 XP, Citation X and Embraer Legacy.
What's more, the company's profits are sky-high. By reducing its infrastructure by almost 30 percent and increasing its revenue production per operating asset by 52 percent, the company posted sales of more than $600 million in 2006.
Flight Options offers variable pricing with its JetPASS Ultimate Travel membership program — peak, off peak, one way and round-trip pricing — allowing customers to choose from 24 different price points ranging from as low as $3,500 an hour to $12,000 an hour. Plus, with just a 48-hour notice required, customers can fly to anywhere in the contiguous United States or any point within 200 miles thereof. This includes Northern Mexico extending to the Tropic of Cancer, Cabo San Lucas and the Bahamas.
"Because we were able to streamline the back of the business so much, our customers are buying a fractional share from Flight Options on a new airplane versus buying a new airplane from one of our competitors," Scheeringa says. "Over a five-year time frame, our customers can fly up to 30 percent more hours with our Fractional First program for the same dollars as they would spend with one of our competitors, and we can do that at a profitable level."
Now almost 10 years old, Flight Options has earned a reputation as a leader and innovator introducing new safety initiatives, receiving some of the highest customer satisfaction ratings in the company's history, and producing what Scheeringa believes to be the most sustainable business model in the for-hire segment of private aviation.
"I think the single biggest reward is providing a long-term livelihood for our 1,500 employees," he says. "When I joined the company there was a very uncertain future, and today I can look any one of my team members in the eye and say, 'I've never been so confident about the industry and specifically our business in leading it.'"