Originally published in the Hartford Business Journal on August 18, 2008
By Jason Millman
For Charles Santoro, a co-founder and managing partner of Sterling Investment Partners in Westport, it was an easy decision to start using Linear Air’s new air charter service.
Santoro said he takes at least four round-trip flights a month to destinations as far away as Ohio and Washington, D.C. While most of his flights are business related, he also uses the Concord, Mass.-based charter service to fly to the house he is building on Martha’s Vineyard. “I travel all over the Northeast on very short notice,” said Santoro, who estimated he spends $100,000 on flights each year.
As commercial airlines cut back flights and companies look to sell off private jets in response to overwhelming fuel costs, Linear Air is looking to expand business in Connecticut.
Bill Herp, CEO and founder, believes his four-year-old company will fill the business traveler’s demand for quick point-to-point air service. And with a fleet of aircraft more fuel efficient than the typical commercial jet, Herp sees his company as well positioned for growth in a turbulent time for the aviation industry.
Linear Air doesn’t claim to be a cheap option for the casual traveler.
An hour aboard an Eclipse costs about $1,900, meaning a 500-mile round trip costs about $6,000, though prices are adjusted each week for fuel costs.
Three Seats, No Bathroom
When the company started in 2004, it operated a fleet of four Cessna Grand Caravans, which hold up to eight people, travel up to 180 miles per hour and have a range of 600 miles. Last year, Linear Air added five Eclipse EA500s, a type of Very Light Jet that uses only about half as much fuel as a Grand Caravan.
“What’s really important about the Eclipse is it’s so fuel efficient ... we can offer service for half the price,” Herp said.
Herp compares the Eclipse to a “taxi with wings.” The plane, which is powered by two lightweight Pratt & Whitney engines, seats only three and doesn’t have a bathroom. That’s not an issue, though, he said, because the average flight takes 90 minutes. The plane has a maximum speed of 350 miles per hour and a maximum range of 1,000 miles.
“It’s like the back of a car service,” said Herp, “except you’re zipping along at 350 miles an hour.”
A pilot for Linear Air waits for passengers to board an Eclipse EA500. The lightweight plane has a range of 1,000 miles.Linear Air flies out of Hanscom Field in Bedford, Mass., and Westchester Airport in White Plains, N.Y. Herp said the company flies to more than 500 airports in the Northeast, including Bradley International Airport. Herp said the number of customers from Fairfield County who fly out of Westchester has increased steadily, and overall business grew by 90 percent in 2007.
The company is looking to raise about $10 million by the end of the year to purchase more Eclipses. The Federal Aviation Association predicts VLJs like the Eclipse will be in high demand over the coming years, forecasting that 400 to 500 will be manufactured each year through 2025.
Herp estimates there is an even split between people traveling for business or personal reasons, though the company is projecting business travelers will make up 70 percent of its customers after it adds more Eclipses.
When considering the alternative option — driving long distances and staying overnight at a hotel — Linear Air’s prices seem reasonable, he said.
There will always be a demand for quick point-to-point air service, and there will always be people with the resources to afford that travel luxury, said Robert Mann, a New York-based airline industry analyst.
The marketplace seems favorable to Linear Air, given the recent drop in sales of private planes in the United States, Mann said. Meanwhile, many companies are frantically trying to sell off their fractional ownership of private jets, he added.
“I get a blizzard of unsolicited e-mails from brokers trying to get rid of airplanes,” he said. “They’re just a couple of years old — some older — and people are desperate to get out.”
While charter airlines are experiencing growth, they are still a premium service for customers who tend to have the resources to afford the luxury in any economy, said Mike Boyd, president the Boyd Group, a Colorado-based airline consulting service. “The VLJs are utterly incredible things to fly in,” Boyd said, “but they’re still expensive on a per-seat basis for us mere mortals.”
A Cautionary Tale
As Linear Air looks to expand service, another air charter company serves as a cautionary tale against overestimating market demand.
DayJet, which flies to 60 airports in five southeastern states, operates a fleet of 26 Eclipse 500s. The idea for the company was hatched in 2002 and took flight in October 2007. However, DayJet laid off 120 employees in May after the company found investors were wary of how fuel costs have hurt the aviation industry, according to Traver Gruen-Kennedy, vice president of strategic operations.