ORLANDO — Executive AirShare, which was founded in Wichita, showcased a new program at this year’s National Business Aviation Association’s annual convention.
The regional fractional ownership company, headquartered in Kansas City, is introducing a leasing program allowing members to lease, rather than buy, a percentage of an Embraer Phenom 100 business jet.
The company is dedicating a portion of its fleet to the program, called Launch.
In a “soft” rollout of Launch, Executive AirShare signed eight customers in the first 30 days. That’s better than expected, said Keith Plumb, the company’s president and chief operating officer.
“It’s been a very well-received product that has a lot of potential,” Plumb said.
Members have access to the airplanes, which are flown by Executive AirShare pilots, for up to 25 days or 60 flight hours during the two-year term of the lease.
They also will be able to switch to one of the company’s King Airs.
The lease program “provides all the same benefits of a fractional ownership program, but at a lower entry price,” Plumb said.
There is also an hourly rate, which is slightly higher than the rate for a fractional owner, he said.
The Launch program serves as a bridge for customers to eventually move to fractional ownership.
“Within the Launch agreement, there is an incentive for when the Launch member is comfortable, they can covert to ownership at very good terms,” Plumb said.
The company expects its Launch business to eventually make up about 20 percent of its total revenue.
“It’s a good way to get people flying our airplanes, getting to know us and our products,” Plumb said.
The program’s introduction is good timing he said, because people are still unsure about the economy.
The Launch program takes aim at competitors that offer jet cards, which allow a customer a specified number of flight hours for a set fee.
The Internal Revenue Service categorizes the flights as charter flights, subject to a 7.5 percent excise fee, Plumb said. The IRS, meanwhile, considers fractional flying noncommercial and not subject to the excise fees.
The Launch program has created more demand and more jobs for Executive AirShare, Plumb said. It’s adding eight pilots by the end of the year.
It currently employs about 130, including about 70 pilots.
The company also plans to add additional King Air and Phenom 100 aircraft to its fleet.
The company allots 1/16 of a Phenom 100 to each customer of the lease program. When 7/8 of a plane is sold or leased, the company adds another aircraft.
The company’s fractional ownership business has been steady, Plumb said. It has picked up some former CitationAir customers after CitationAir, a subsidiary of Cessna Aircraft, announced it was ceasing fractional jet sales to focus on its jet card and jet management business.
“It really stimulated our business,” Plumb said.
Executive AirShare has more than 140 shareowners, up from more than 120 a year ago.
It has 26 airplanes in its fractional fleet and manages 16 more.
The company is expanding into Austin, San Antonio and Houston – and hiring two Texas-based sales directors.
It currently serves Wichita, Kansas City, Tulsa, Oklahoma City, Fort Worth and Dallas in Texas, and Buffalo, N.Y.
Its fleet includes Phenom 300, Phenom 100, Beechjet 400A, King Air 350 and King Air C90B aircraft.
“We’re setting up for significant growth,” Plumb said.