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Friday, September 28, 2007

Going My Way: ExpressJet Flies for Virgin Charter

In a presentation that felt more like a live infomercial selling Oxy-Clean than a National Business Aircraft Association event, Virgin Charter introduced itself to the NBAA audience last week explaining its E-Bay-like charter auction service and including ExpressJet (XJT) as one of its initial contractors. XJT will use its Embraer ERJ-145XRs in the new operation.
In a separate move, ExpressJet formed a Preferred Partnership with Avis Budget Group, providing special discounts and added value programs for members of ExpressJet's JetSet(SM) frequent flier rewards program.
Virgin Charter was launched last June and follows the certification of the Virgin Group’s new low-cost, U.S. airline. The company is a full-service marketplace that brings together buyers who want to book private air travel with safety-rated charter operators. It hopes to eliminate the uncertainty and hassles in booking charter flights. Seller inventories are made available on line without changing the charter business model. Passengers end up managing their entire trip on line instead of calling each charter company, finding availability, negotiating a price and then booking their flight. Virgin Charter does not own or operate aircraft, and it does not act as a broker. The service targets high-end charter clients by allowing passengers to search its computer reservation system for aircraft going their way as long as they originate in the U.S. In a twist on the Priceline model, charter companies bid on the passenger’s trips combining it with the eBay model. Operators then give Virgin Charter a cut.
The new distribution system, with others entering the marketplace in the past year, promises to bring about the same revolution in booking that the computer reservations did for the airlines industry in the 1980s and 1990s with the additional kick of the Internet. With Virgin Charter, the bids will be available to everyone – competition and passengers alike.
In addition to addressing booking hassles, Virgin Charter is tackling safety, encouraging aircraft owners and operators to get a third-party safety audit, the results of which will be on its site. This is significant since such audits are unavailable elsewhere and it may overcome another barrier to wide-spread use of charters – corporate policies on safety as well as those against executives traveling together. Virgin Charter's partnership with CharterX includes such safety audits by its subsidiary Wyvern Consulting.
XJT cited its 99.5 percent dispatch reliability as well as its long airline operating experience for its inclusion in the new on-line charter marketplace. In addition to Virgin Charter, XJT customers include rock bands, hospitality companies, aircraft brokers, sports teams and schools. This could be a real boon to ExpressJet, which, while it has kept its nine-aircraft charter fleet busy, has yet to achieve the 15 aircraft devoted to charter operations it had originally planned.
"ExpressJet Airlines has been a Fortune magazine 'Most Admired Airline,' twice, in large part due to our ability to deliver a reliable, consistently high-quality experience to customers," said Jim Ream, President and CEO.
Virgin Charter, based in Santa Monica, Calif., created a full-service online marketplace where safety-rated charter aviation operators meet private aviation customers. Other contractors include XOJets which last week inked a deal for Cessna Mustangs.
The listings include buyer ratings and operator safety audits available to consumers before booking a flight. Adapting the service to the social networking model, the commentaries go both ways, however, with charter companies posting comments about passengers and vice versa. The Virgin Charter team is led by founder and CEO Scott Duffy, a seasoned Internet executive and private aviation veteran who served as a managing director for one of the largest charter brokers of private aircraft in the world. Duffy, who was looking for funding for his eBay charter booking scheme, was approached by Virgin USA, which was developing a similar service, and offered the marketing might needed to get the business off the ground as well as more investment than Duffy could have ever expected going out on his own. In addition to Duffy, The team also includes technology and aviation executives from Google, Expedia, eBay and the Jet Propulsion Laboratory. Said Duffy, "Virgin Charter's centralized marketplace will revolutionize private aviation by providing tremendous efficiencies to what has been a highly fragmented industry."
"We are excited to have ExpressJet on board as a Charter Member," said Scott Duffy, Founder and CEO, Virgin Charter. "Having the most respected charter operators in our marketplace is one of the elements that make it the most innovative and efficient way to buy and sell private air travel."
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