DayJet Ushers in New Transportation Paradigm

Even as it carried revenue passengers last month, DayJet formally ushered in its new transportation model last week for the 1,500 members it has signed up to take advantage of its per-seat, on-demand jet service. The rollout of the new service spread across its five-city Florida network on Wednesday allowing travelers to book a single seat on its fleet of Eclipse 500s.
The most important aspect of the new service is restoring the out-and-back-in-one-day business trip, long since lost with the changes in the regional airline industry. The company also confirmed its plans to expand “Per-Seat, On-Demand” service within the next two years to dozens of additional DayPort locations across the Southeast, including Alabama, Georgia, Mississippi, North Carolina, South Carolina and Tennessee. DayJet promises millions of dollars in new economic activity for its DayPorts.
“We are embarking on a new era in regional transportation that, for the first time, brings the benefits of on-demand jet service to the average business traveler,” said Ed Iacobucci, DayJet president and CEO. “Starting today, business travelers in the Southeast can have all the power in the travel relationship. They can decide how much their time is worth and dictate a travel itinerary that increases their productivity and enhances their quality of life. It took years of hard work and innovations to make this new service a reality. It would not have been possible without close collaboration with our partners at Eclipse Aviation, Pratt & Whitney-Canada, the Federal Aviation Administration, the State of Florida and our first DayPort communities.”
The service inauguration and grand opening of its first DayPort facilities in Boca Raton, Gainesville, Lakeland, Pensacola and Tallahassee, Fla., was marked by a press conference in Tallahassee. Joining were Florida Lt. Governor Jeff Kottkamp, Tallahassee Mayor John Marks, Eclipse Aviation President and CEO Vern Raburn, other state and local elected officials as well as leaders from the business community.
Calling its service the "next major advance in regional business travel," the company, which operates under Part 135, is seeking partnerships with regional economic authorities, airports and FBOs that want DayJet as part of their business structure. It is also capitalizing on technology such as ADS-B. Even as FAA has moved to require the technology by 2020, its widespread deployment with VLJs provides a significant competitive advantage as they will be able to springboard passed scheduled airlines and take advantage of more efficient routings through satellite technology. See related story this issue.
The company says it is, perhaps, one of the best capitalized startups in American aviation history, and the single largest carrier in the on-demand sector. It attributes its ability to raise funding to its unique business model and industry position, DayJet has raised more than $200 million to date in both private equity and debt.

Customer Convenience, Comfort and Control
DayJet’s customized approach to business travel turns the usual power structure of mass transportation on its head – passengers tell DayJet where and when they want to travel, and how much they are willing to pay. The company’s flexible Time-Value Pricing™ structure enables members to set a value for their time. If their time is at a premium, members can create a narrow travel window. When they have more flexibility, they can reduce their cost by setting a wider travel window. The more flexible members are with their travel time, the lower the airfare.
“I was the first passenger on DayJet and the service exceeded my expectations,” said Howard Gruverman, CEO of Edify USA. “The plane was roomy and comfortable, the pilots had impressive experience and the whole service model worked exactly as promised. DayJet is a great tool for business people who want to make better use of their time, conducting more business while they improve their quality of life.”
Unlike scheduled airlines, DayJet creates a unique flight plan for each customer who dictate where to fly, when to fly, and how many aircraft and pilots to deploy – through a real-time reservation system that quotes and books trips in seconds.

World’s Largest VLJ Fleet Operator
To facilitate its growth, DayJet has a five-year order for more than 1,000 Eclipse 500 VLJs. The company’s fleet, which currently numbers a dozen Eclipse jets, is planned to grow to 30 jets by year’s end. Within two years, the DayJet fleet is expected to exceed 300 Eclipse 500 VLJs.
“The Eclipse 500 very light jet’s value proposition has inspired a new layer of affordable regional air transportation that will allow travelers to save time and be more productive,” stated Raburn. “DayJet and Eclipse are demonstrating that the idea of a new class of aircraft that are compliant with the FAA’s NextGen strategy will change the work-life balance of hundreds of thousands, and eventually millions of Americans.”
“Pratt & Whitney Canada’s innovative PW600 engine family is helping to spark a whole new market in jet travel, while promising a smaller footprint in terms of fuel consumption, carbon emissions and noise,” said Alain M. Bellemare, president of Pratt & Whitney Canada. “Together, we are revolutionizing the way people travel.”

First All-Digital Commercial Air Carrier
Last week’s launch is only enabled through DayJet’s proprietary all-digital, real-time operations system, which the company has spent the last five years developing. DayJet is the first air carrier in U.S. history to build and deploy a 100 percent digital operation.
DayJet’s Advanced System Technology for Real-Time Operations (known as ASTRO) – which contains more lines of code than early releases of Microsoft Windows – automates and manages every aspect of the company’s operations, end to end. This includes customer reservations, billing and membership management; flight records and training; flight planning and scheduling; pilot electronic flight bag (EFB); DayPort field information; and maintenance control.
ASTRO’s all-digital capabilities include digital signatures, electronic surveillance, electronic record keeping, automated flight planning and filing, automated compliance checking and automated TSA security clearance. ASTRO is built on highly complex mathematical algorithms and enables DayJet’s “Per-Seat, On-Demand” advantage as it can calculate in real-time the optimum deployment of hundreds of planes and pilots to meet the demands of customers, while ensuring regulatory compliance.

DayJet’s Target Audience
Traver Gruen-Kennedy, vice president of community and government affairs for DayJet, identified for VLJ Report’s sister publication Regional Aviation News earlier this year, the company's target market. Points were selected for their strong business climates and limited transportation infrastructure, adding they will serve as "access ramps to the world's first per-seat, on-demand jet service." Cities with populations of between 300,000 and more than a million, might be good aircraft bases for DayJet. Gruen-Kennedy said that overly rural markets will not have enough density to support DayJet service.
Its entire marketing effort is geared toward mid-level managers, sales reps, trainers, health care companies and IT professionals, who do a lot of “windshield time” between customers, according to Gruen-Kennedy, who is focusing on hard-to-reach markets for the business traveler who wants out-and-back-in-one-day service.
DayJet market research indicates that business professionals drive for 86 percent of the 592,000 annual business trips taken between such cities. He also pointed out that between 2000 and 2006, scheduled flights between all Florida markets decreased by 47 percent, while available seat capacity declined by 31 percent.
Gruen-Kennedy expects 90 percent of flights will be under 600 miles with DayJet’s secret weapon being its proprietary software that efficiently matches customers to aircraft and overcomes the deadhead/positioning legs of the corporate jet market and the certification and service distribution barriers encountered by scheduled new entrants.
When assessing a market, DayJet does not even look at the largest employer. Instead it looks to the employer with the largest number of travelers within a region. “A 15-person company with regional offices that provide services to industries disbursed over a region, is our target,” said Gruen-Kennedy. “This is the person who is not high on the pay scale but whose time is valuable, making a flight worth it to the company. Economic development will happen between communities with great access. The traditional airline hub-and-spoke model is very successful for certain types of travel but not for other types that we are targeting.”
DayJet’s information is garnered from 20 focus groups across the country as well as quantitative study of 85,000 travel decision makers.
The cost for the passenger will be between $1 and $3 per seat mile depending on the flexibility of the passenger. If the passenger is flying a very tight schedule, the cost will be in the higher range. But if they are more flexible and can afford the time to accommodate at least one pick-up, drop-off or fuel stop, the cost will be less. Market studies indicate the cost per seat mile aboard a commercial flight going from secondary market to secondary market is between 75 cents to $1. However, DayJet also pointed out what business travelers and travel managers have told them – the premium costs of DayJet come out even, when considered against a backdrop in which commercial schedules often mean hotel and per diem costs.
A lot depends on changing travel behavior Gruen-Kennedy admitted, and not only extends to corporate travel managers and employees but their contacts. “Some of these meetings used to take place at the Ambassador’s Club or Crown Room but security now precludes that,” he said. Such changes would also minimize ground transportation needs but require airports to upgrade or development meeting rooms. It is likely this would not be a problem since these are the airports that have lost critical revenue along with air service and are re-inventing themselves to cope with the losses.
The big concern with this new technology is safety on many levels. In addition, air traffic control congestion remains a concern, although the aircraft and business models are designed to keep away from congestion. Manufacturers and the General Accountability Office as well as the FAA do not expect an impact on congestion owing to their incremental addition to the airspace. Related Story  After all, its main selling point is direct, non-stop service to their destination, sans congestion, sans hubbing and spoking and sans overbearing security hassles.
DayJet has prepared for such issues by pioneering a digital monitoring system in which the FAA can access its computer systems at any time to check on compliance. In addition, it is using satellite-based technology, developed under the NASA/FAA Small Aircraft Transportation System (SATS), according to Gruen-Kennedy to minimize impact on ATC. Gruen-Kennedy is an active participant in Next Generation Transportation System (NGATS), and is a member of the SATS National Strategy Committee of the National Institute of Aerospace (NIA).
“This will be precision navigation to fly pre-certified routes built into the avionics, triangulated by three or four satellites,” he said. “This not only provides time and fuel efficiency but allows us to operate to lower minima and closer separation.” Despite the sophisticated pilot training and mentoring programs being rolled out by manufacturers such as Eclipse and Embraer, and the requirement for two-pilot operations from DayJet and other such operators, observers still question safety. Given the appetite for increasing regulation, it will not take much in terms of accidents to see the Part 135 passenger transportation market go the way of the regional industry making it highly likely that the single level of safety will extend down to the new business models and technology. As it did with regionals, this will change the economics and may make the business model untenable with the increased costs. Even so, FAA is working on commercial regulations for VLJs which takes into account Part 135 operations. Related Story