Forbes Business Aviation Special Report May 2011 - XOJET (2)

Courting new business and keeping existing customers is a

costly challenge in any economy. Yet some companies have

defi ed the downturn, positioning themselves for a recovery

and becoming more productive in the process. They are

using business aircraft to free themselves from commercial

airline constraints, cash in on domestic and global market

opportunities, and realize greater value than ever before.

“It is a terrific working tool,” says The Stewart Orga-

nization’s chairman, Walter Stewart. His company has a

Flexjet Learjet 40 and Challenger 300 business aircraft at

the ready, which made it feasible for him to expand far

beyond the company’s original Birmingham, Ala., cus-

tomer base. “Travel is essential for us to compete and to

expand,” says Stewart.

FLIGHT LOGS // REAL-LIFE BUSINESS AVIATION SUCCESS STORIES

SATELLITE RECEIVERS, LTD./CASH DEPOT

WEATHER CENTRAL, LP

EZ GRILLHOMESTEADERS LIFE COMPANY

XOJETTHE SCOTTS MIRACLE-GRO COMPANY

PAGE 10PAGE 8PAGE 6PAGE 5PAGE 4PAGE 2

A GAME CHANGER FOR THE RECOVERING ECONOMY

WRITTEN AND PRODUCED BY MARK PATIKY

SPECIAL ADVERTISING SECTION // BUSINESS AVIATION

Vital Revenue Generator Business aviation fl iers—whether they

own jet cards, fractional shares or whole

aircraft—recognize the game-changing

benefi ts business aircraft access provides.

To land deals, land closer to your customer.

That’s the attitude of many business peo-

ple who are convinced that business avia-

tion gives them an undeniable advantage.

Business aviation can convert hours of

travel time into hours in front of customers.

It allows companies to pursue opportuni-

ties in smaller, untapped markets far from

commercial airline hubs.

It’s not a luxury or a liability, but rather a

vital asset and revenue generator. “While

other companies may be retrenching, we

see tremendous competitive advantage

with our business aircraft,” says Stewart.

“Being there face-to-face ahead of the

competition is crucial.”

Having the ability to bring customers to your company’s

home turf is also extremely valuable. “We use our plane to

pick up clients and bring them to our offi ce,” says David

Charles, Sr., president of Satellite Receivers, Ltd./Cash

Depot, which is based in Green Bay, Wis. The company,

which owns an Avantair Avanti fractional share, sells and

services ATMs nationwide. Bringing customers to its facility

has been critical to closing deals.

Phillip Swan, CEO of Kirkland, Wash.-based EZ Grill, adds,

“When you have to be in places like Ponca City, Oklahoma;

Bentonville, Arkansas; Morrisville, North Carolina; and Woon-

socket, Rhode Island; you had better not depend on the airlines

FLIGHT LOG // THE SCOTTS MIRACLE-GRO COMPANY

Based in Marysville, Ohio, the Scotts Miracle-Gro Company

uses a Dassault Falcon 50 EX and Falcon 900 to sow seeds

for success around the globe. “These are business tools, just

as important to us as a lawn spreader or a delivery truck,”

says Matthew Clifford, director of fl ight operations. Company

growth is directly attributable to use of the aircraft, he says.

“With an hour’s notice, we can have either airplane headed to

any of thousands of locations coast to coast, nonstop.”

It’s not unusual to make as many as fi ve customer or sup-

plier visits in a day, and those schedules can change on a

moment’s notice. “We save our people time and enhance

their productivity,” says Clifford. With functional, spacious,

secure cabins and satellite communications and Wi-Fi Inter-

net capability, the Falcons become airborne conference

rooms. “They are equally useful for client meetings on the

ground,” he adds. An unmatched advantage is the Falcons’

ability to use shorter runways and still carry enough fuel for

nonstop cross-country or transatlantic fl ights, and the three-

engine design is an added safety feature he likes, especially

for overseas travel.

ADVERTISEMENT 2 // THE ENLIGHTENED BUSINESS TRAVELER

Director of Flight Operations Matthew Cliff ord

Business: 143-year-old company, global market leader in lawn and garden products

Travel Need: Meet with vendors and customers across the U.S. and Europe

Aircraft of Choice: Dassault Falcon 50EX and Dassault Falcon 900


FLIGHT LOG // XOJET

XOJET, unique in business aviation, owns all of its young

fl eet outright and offers top-ranking charter using only two

aircraft types: the Bombardier Challenger 300 and Cessna

Citation X, selected for effi ciency, speed, comfort and con-

sumer appeal. XOJET’s hybrid business model combines the

benefi ts of private jet membership and on-demand charter

service with the consistency of fractional ownership. While

one can fl y to or from anywhere at on-demand charter rates,

XOJET pioneered discounted fi xed-rate charter based on 88

predefi ned coast-to-coast routes, as well as a fl y-anywhere

membership program.

CEO Blair LaCorte’s aircraft choices are as attractive as his

business plan. The Citation X is one of the world’s fastest civilian

aircraft, and the Challenger 300 offers superior reliability, main-

tainability and fuel effi ciency, plus a spacious, wide cabin and

the ability to land at smaller airports. Each XOJET Challenger

is identically equipped with unique noise-dampening features,

built-in surround sound, serene interior décor and Aircell Wi-Fi.

It’s a huge bonus for travelers who count on saving time and

money while gaining productivity in the air, says LaCorte.

CEO Blair LaCorte

Business: Innovator in air charter

Travel Need: Competitively priced, safe and effi cient air charter service to 5,000 locations nationwide

Aircraft of Choice: Bombardier Challenger 300 and Cessna Citation X

to get you there. If it’s a matter of get-

ting the contract or losing it, then

the higher cost of business aviation

represents tremendous value,” says

Swan, whose Flexjet Learjet 40 helps

fi re up the profi ts.

Clear Skies AheadThese business executives are defi -

nitely on the right fl ight path. Recent

studies released by NEXA Advisors

LLC show that both large S&P 500

companies and the S&P SmallCap

600 small and midsize companies

achieved greater success by using

business aircraft—even during the

worst fi nancial recession in recent

memory—than those that do not use

business aircraft. “This study reveals

that use of a business airplane is a

sign of a well-managed company, regardless of its size,” says Ed

Bolen, president and CEO of the National Business Aviation Asso-

ciation. “The level of productivity, fl exibility and effi ciency business

aviation provides allows companies of all sizes to remain produc-

tive despite the tough economy. This latest study confi rms it.”

So what does it take to create revenue-generating, game-

changing strategies that allow you, too, to fl y circles around

the competition? For many, the fi rst step is seeing past the

limitations of commercial travel. Read on and learn what these

forward-thinking companies have discovered about highly

customizable airborne options that put you face-to-face with

customers, prospects and vendors more often and more nim-

bly than ever before. Follow their guidance and your business

will be taking off well before the competition arrives.

BUSINESS AVIATION // ADVERTISEMENT 5

FRACTIONAL OWNERSHIP AND JET CARDS

FLIGHT LOG // HOMESTEADERS LIFE COMPANY

“We work with funeral homes all over the country, and lots

of times they’re in smaller communities that are as hard to

get to as Des Moines,” says Graham Cook, Homesteaders

Life CEO and chairman. Nine years ago, Cook turned to

NetJets for the perfect solution. Now he brings busy funeral

home directors to his company headquarters and returns

them home the same day. “Meeting face-to-face is totally

invaluable,” says Cook. “The airplane is defi nitely a tremen-

dous closing tool. To get someone here for a half-day visit

traveling commercially is a two-day marathon. But if they

can be here and back quickly, it makes the trip practical.”

He can also use two aircraft simultaneously, which he did

recently for overlapping customer visits. “It’s about leverag-

ing that capability to build your business. It’s helping us build

relationships. You can’t do that with e-mail,” he says. It’s

worked so well, in fact, that Cook increased his hours with

NetJets this year.

CEO and Chairman Graham Cook

Business: 105-year-old company, national leader in pre-need funeral funding

Travel Need: Flying funeral home owners from 37 states to its Iowa headquarters

Aircraft of Choice: NetJets—Cessna Citation Encore

While whole aircraft ownership has strong appeal, fractional

and jet card owners gain the ability to:

• Call for their aircraft at any of 5,000 locations in the

nation—guaranteed—at any time

• Fly anywhere

• Exchange for another larger or smaller aircraft as needed

• Use multiple aircraft simultaneously

Jet cards grew in popularity during the economic downturn

as buyers sought relief from the fi nancial risk and long-term

commitment associated with fractional ownership. That’s

all changed. A leading indicator of the market’s recovery is

renewed interest in fractional ownership. The resurgence is

attributed to availability of attractive tax and bonus deprecia-

tion benefi ts, as well as rising aircraft value.

Now, new hybrid programs—which lower barriers to entry

and combine the most appealing fractional and jet card ben-

efi ts—are gaining buyer attention. In addition, aircraft offering

new technologies and improved operating effi ciency are ignit-

ing interest from business travelers with pared-down budgets

who are aggressively exploring new market opportunities.

The latest aircraft offer fully connected cabins with wireless

high-speed Internet and other high-tech amenities that trans-

form travel time into highly productive airborne offi ce time.

That means not only can you save time and money getting

there, but you can use time in the air as productively as you

can on the ground.

NetJets Owned by Berkshire Hathaway, NetJets invented fractional

ownership and took it to new heights with the largest and

most diverse fl eet. Recently, NetJets acquired Marquis Jet,

which launched the jet card revolution by providing NetJets’

quality and service 25 hours at a time.

NetJets operates the only fractional ownership fl eet in

Europe and has an affi liation with the NetJets Middle East

Program. Underscoring the increased demand for ultra-long-

range global travel, NetJets recently announced its fi rst-ever

purchase of Bombardier aircraft, including the Bombardier

Global 5000, Global Express XRS Vision, Global 7000 and

Global 8000. These new ultra-long-range jets will join a fl eet

that includes Cessna, Hawker-Beechcraft, Dassault and Gulf-

stream aircraft. Last October, NetJets announced plans to


FLIGHT LOG // EZ GRILL

EZ Grill products make backyard barbecues convenient, but

a grueling schedule of meetings with retailers was anything but

convenient for CEO and cofounder Phillip Swan. “We do busi-

ness nationwide, often in diffi cult-to-reach places,” says Swan.

“Now I can get to 11 meetings in two and a half days, not the

two and a half weeks it would take fl ying commercially.”

To make a success of a start-from-scratch company, Swan

chose a Flexjet 25 Jet Card to light the fi re. It is a key ingre-

dient in Swan’s success. Choosing either the Learjet 40 or

Learjet 45, depending on the trip length and number of people

traveling, he can fl y nonstop, typically landing minutes from

his destination while gaining enormous fl exibility. “It means

maximum optimization of your time, because you’re on your

own schedule,” he says. “If we can close a half-million-dollar

deal and it costs perhaps $15,000 to get there, is that a return

on investment? I think it is.”

CEO and Cofounder Phillip Swan

Business: Environmentally responsible, economy-priced out-door cooking products

Travel Need: Reaching retail outlets in small towns nationwide

Aircraft of Choice: Flexjet Learjet 40 and 45

add Embraer Phenom 300 Platinum Edition

aircraft to its light-jet fl eet. In addition, the

company is retrofi tting more than 250 air-

craft with Aircell high-speed wireless Inter-

net service, a feature that all new models

will offer as a standard.

FlexjetFlexjet, owned by Bombardier, experienced

a 45% increase in new business year over

year as of February 2011, which Fred Reid,

Flexjet president, feels is an indication of

sustained economic recovery. Fractional

ownership experienced the biggest growth

during this time. Fractional and jet card own-

ers, he says, are fi nding exceptional value

in Flexjet’s range of Bombardier aircraft,

including the Learjet 40XR, 45XR and 60XR; the super-midsize

Challenger 300; and the intercontinental-range Challenger 605.

Flexjet also offers a complete spectrum of business jet solu-

tions ranging from on-demand charter and the Flexjet 25 Jet

Card to fractional ownership and whole aircraft ownership,

combined with management. In addition, Flexjet will be the

launch customer for Bombardier’s all-new Learjet 85.

Other Flexjet offerings include:

• The exclusive WalkAway lease, which minimizes cash

outlay and asset value risk

• The exclusive Versatility Plus program, which enables

owners to buy or sell hours as needed without affect-

ing future-year allocations

• A reciprocal marketing alliance with VistaJet, which

operates an all-Bombardier fl eet in Europe, for inter-

national travelers

• Preferential benefi ts for Flexjet fractional and jet card

owners on Korean Air fl ights. In addition, Korean Air

passengers arriving through ten North American gate-

ways have access to Flexjet’s U.S. fl eet.

Flight OptionsFlight Options’ focus on quality and value has grown to

encompass a new and wide range of fractional ownership

and jet card choices, according to CEO Michael J. Silvestro.

Flight Options offers a mix of new models and top-quality,

pre-owned, fully refurbished and modifi ed older aircraft.


New aircraft include the Embraer Phenom 300, which

brings greater speed and range to the light-jet category,

and the large-cabin, midsize-priced Embraer Legacy.

Silvestro points out that Flight Options is replacing the

older Hawker 400s in the fleet with the newly modified

Hawker 400NT, which features latest-generation avionics

and new Williams engines. Customers like Weather Cen-

tral, LP, Founder and CEO Terry Kelly like the idea that

the new model will use less fuel, have longer range and

reduce his operating costs.

Newly modifi ed Cessna Citation

Xs will bring greater performance at

lower cost to Flight Option’s midsize

aircraft category. While this value-

focused product mix appeals greatly

to individuals and small- to medium-

size companies, larger corporations

wishing to supplement existing fl eets

are exhibiting considerable interest,

says Silvestro. In an effort to add

even greater value, Silvestro is about

to introduce an all-new hybrid pro-

gram, which will eliminate residual

value risk and further reduce hourly

operating costs.

CitationAirCitationAir, owned by Cessna Air-

craft Company, offers a unique

package of business aircraft options,

including jet cards and fractional ownership in a full range of

Cessna aircraft. The strong integration with Cessna has given

rise to an even more comprehensive set of business aircraft

solutions, says Woody Harford, CitationAir’s senior vice

president and CRO.

CitationAir now provides full support to Cessna’s new air-

craft owners seeking turnkey aircraft management arrange-

ments. They can generate revenue when the aircraft is not

in use by making it available to other CitationAir customers,

while gaining all fractional ownership benefi ts.

FLIGHT LOG // WEATHER CENTRAL, LP

Keeping up with changes in the media industry—not just

the weather—means fast action. It’s a diffi cult logistics

problem when you’re based in Madison, Wis., and most of

your customers are in small towns across America. That

hasn’t deterred Terry Kelly, founder and CEO of Weather

Central. For over a decade, he’s counted on a Flight

Options Hawker 400 jet to react immediately to new oppor-

tunity and competitive challenges by fl ying direct to virtu-

ally anywhere. “We have been able to get right in without

wasting precious time, and in every case we preserved and

expanded our business,” he says. “We get our people there

safely and quickly, and we avoid overnight expenses.

“It’s a matter of time and convenience. Customers are

impressed and reassured when they can meet in person

with the whole team,” he says. Often six or seven employ-

ees from a variety of disciplines will travel. “That would

be very hard to accomplish flying commercially,” he adds.

Founder and CEO Terry Kelly

Business: High-tech weather forecasting for print and broad-cast media, insurance and public service companies

Travel Need: Access to media outlets and TV stations through-out the U.S. and Canada

Aircraft of Choice: Flight Options—Hawker 400


The all-new CitationAir Jet Access hybrid pro-

gram bridges the gap between fractional own-

ership and jet cards by combining the advan-

tages of both. “We think it will help defi ne our

company and also the way industry evolves

as it experiences a recovery,” says Harford.

The program eliminates the need for long-term

capital investment while offering hourly rates

similar to those of fractional ownership. Jet

Access requires a commitment of 50 hours or

more annually, and incremental hours can be

purchased at the same rate.

In addition, a cost-effective “supplemental lift”

program called Corporate Solutions allows inde-

pendent fl ight departments to access CitationAir’s fl eet on a

pay-as-you-go basis.

CitationAir offers Cessna’s most popular light and mid-

size jet models and recently added the Citation X, which

is one of the world’s fastest civilian jets and represents the

top end of the Cessna Citation product line.

Avantair Avantair is the exclusive fractional provider of the sleek, fast,

fuel-effi cient Piaggio P180 Avanti turboprop. The company

continues to bring signifi cant value to business aviation with

a top-performing aircraft and a range of attractively priced

programs. “The Avanti combines the best of the smaller jets,

but with greater capability,” says John Colucci, Avantair’s

executive vice president.

It has the cabin space of a midsize jet, a fuel burn 40%

lower than that of equivalent light jets, weather-topping

cruise altitude, a 450-mph top speed and the lowest hourly

cost in the industry. Colucci points out that these are key

reasons why fractional share interest in the Avanti is hot,

and why current Avantair owners are fl ying more.

In addition to the fractional share program, Avantair also

offers a prepaid 25-hour Edge Card that continues to soar

in popularity. The latest news, however, is a brand-new

market-risk-free Axis Lease program. This program requires

a minimal up-front fi nancial commitment and includes an

hourly charge that combines management fees and hourly

operating costs. The net cost is similar to that which frac-

tional owners enjoy, yet the commitment is no greater than

the hours purchased. “Starting at 50 hours, you can build

the Axis Lease program to accommodate exactly the num-

ber of hours you need,” says Colucci.

FLIGHT LOG // SATELLITE RECEIVERS, LTD./CASH DEPOT

Based in Green Bay, Wis., Satellite Receivers, Ltd./Cash

Depot President David Charles, Sr., deploys ATMs at major

retailers coast to coast such as Walgreens, Walmart and

Weigels. Personally meeting with customers in places like

Knoxville or Savannah is crucial to business, but burden-

some airline service—requiring as many as two stops and

daylong travel—hampered Charles’ strategy. Now he’s

cashing in with Avantair, quickly moving executives out of

and customers into his Green Bay headquarters. “The dif-

ference is huge,” he says. “The Avanti is really fast, super-

quiet and has a great big cabin. I’m six feet tall and I can

stand up in it. We can get to any appointment on the East

Coast and back in a day, no hotels, no waiting in line, and

we arrive in a better frame of mind,” says Charles. “You’ve

got to strike while the opportunity is hot, but if you dread

going someplace, you’re just not going to go. Now we’re

the first on the scene. We sign a contract and do the deal.”

President David Charles, Sr.

Business: Retail store ATMs

Travel Need: Maintaining relationships with major retailers nationwide

Aircraft of Choice: Avantair—Piaggio Avanti

Written and Produced by

Mark Patiky ([email protected])

Associate Writer: Susan Burnell

Principal Photography: Paul Bowen

Editor: Allison Lurker Rickert • Designer: Jon Prinsky


THE JET OF TOMORROW

REACH FOR THE SKY

TAKING OFF AT AN AIRPORT NEAR YOUHondaJet continues its ascent to market, taking its aircraft

from a sketch on a piece of paper 20 years ago to the

51-minute fl ight of its fi rst conforming production aircraft over

its Greensboro, N.C., assembly facility in December 2010.

The distinctively designed, advanced light business jet offers

18% to 20% more interior space than a conventional light jet

and sets a lofty standard. Business and engineering innovator

Michimasa Fujino, Honda Aircraft Company’s founding presi-

dent and CEO, says, “We have integrated everything we know

about comfort, effi ciency, safety and productivity in small

spaces, and we are truly creating a unique aircraft category.”

While weighing in as a light jet, the HondaJet has the cabin of

a small to midsize jet and offers extraordinary performance for

the category.

The HondaJet is a maverick that defi es design and manu-

facturing convention. “With the engines mounted on top of

the wings, not on the fuselage, we maximize cabin space,”

Fujino explains. In addition, he says, the unconventionally

positioned engines, newly designed by GE-Honda, enhance

aerodynamic effi ciency and allow the new jet to fl y at higher

speeds with greater fuel effi ciency.

The roomy cabin accommodates an in-fl ight entertainment

system, ceiling-mounted touch-screen monitors and a fully

enclosed lavatory. “We didn’t skip anything. Cabin noise is very

low, since engine vibration and noise do not translate directly to

the fuselage,” says Fujino, who learned much about ergonomic

design and functionality from Honda automobile development.

First delivery of his brainchild is expected in 2013.

There is no question that America is getting back to busi-

ness as competition for new markets heats up. Companies

scouring global markets for new opportunities are using busi-

ness aircraft to get there fast. As a result, business aircraft

manufacturers report a strong uptick in demand for long-

range aircraft.

The Dassault Falcon 7X with extended range is achiev-

ing great success, not only in the U.S., but also in India,

China and Brazil. The tri-jet Falcon family, including the 7X

and Falcon 900 models, has proven itself on transoceanic

routes. The three engines add considerable security ben-

efi ts, together with performance enhancements enabling

takeoffs from shorter runways with suffi cient fuel capacity

for nonstop global journeys. Add to that the latest fl ight deck

technology—such as enhanced and synthetic vision, which

augments fl exibility, safety and performance in the most

compromising fl ight situations—and you’ve got capability

and effi ciency that works as well between New York and

Tokyo as it does between New Orleans and Topeka.

Bombardier also has achieved signifi cant success in

global market environments where range and capability are

the watchwords. The Challenger 850 and the new fl eet of

Global aircraft—the 500, XRS, 6000, 7000 and 8000—are

breaking range records daily. The Global 8000 truly puts the

world at your fi ngertips. With its 9,000-sm range, Mumbai,

Hong Kong or Singapore are within nonstop reach of New

York. The three-zone cabin offers berthable seats for 12

passengers, so a group can work, dine and sleep comfort-

ably during 16-hour fl ights and remain in constant touch via

Internet, phone or TV.

Onward and UpwardYou’ll be amazed when you speak with those who use these

aircraft, ranging from turboprops and small jets to globe-

spanning behemoths. You’ll learn that a business aircraft

might be the best tool for gaining that competitive edge. And

with the myriad ways to access one, there is no reason to be

left behind. As world economies get back on their feet, the

challenge is on. Isn’t it time that you, too, reached for the sky?

Documents

Forbes Business Aviation Special Report May 2011 - XOJET (2)