Naomi: “Hello and welcome to the Taxcast, the Tax Justice Network podcast. We’re all about fixing our economies so they work for all of us. I’m your host, Naomi Fowler. You can find us on most podcast apps. Our website is www.thetaxcast.com. You can subscribe to the Taxcast there, or you can email me on [email protected] and I’ll put you on the subscriber’s list. Get in touch and tell me what you think of the show! OK, on the Taxcast…

[dog sounds and jet sounds]

…spoiled pets and private jets. We can’t afford the rich. But there’s plenty we can do about it. So, come fly with us…yeah, I know it’s cheesey!”

[Music: Sinatra, Come Fly With Me]

Naomi: “Whether you’re pretty wealthy, even wealthier or super-stonkingly rich, if you choose it, there’s no long waits at airport check-ins for you, and no need to expose yourself to diseases by mixing with the public – seriously, monkey pox and covid are two of the reported reasons private aviation’s booming. And apparently it’s tough in the private jet business, as this entrepreneur explains. I hope you’re taking notes!”

Entrepreneur: “About a year ago in the beginning of 2022 I started a private jet charter broker company with a partner and here’s the reasons why you should not start this business: first off, the customer is very, very specific and very, very hard to market to. The person you’re going after that’s going to spend 20, 30, 40, 50,000 dollars on a private jet flight for a single charter is somebody that makes between 5 and 10 million dollars a year or more. Now how do you acquire these customers? If you have a very good organic network and you know a lot of high net worth individuals that charter jets specifically then this may be a business model for you, but for myself even knowing a lot of people that make a million dollars a year, two, three million dollars a year, even those people in my network often do not travel via private jet, it’s simply not worth the cost. If you’re making a hundred thousand dollars a month net or even gross, whatever it may be, twenty-thousand dollars on a trip is quite a lot of money and it really just doesn’t make sense if you can fly first class or whatever, so the customer is very, very hard to go after. My business as a private jet charter broker is over, it’s a failure for me.”

Naomi: “Oh dear! So this guy didn’t own any private jets himself. What he was doingwas connecting up wealthy people to private jet operators for a fee. And he was mainly using google ads to get his leads. In that YouTube video, he says he was investing about $1714 to get enough clients who eventually paid up for private jet flights, and he made an average of $1837 per flight. You can see why he gave it up!

But a few steps up from that, there are of course big multi-million dollar companies that own, lease and operate entire fleets of private jets. The number of private jets globally has gone up 133% in the last 20 years. But there are some challenges to their business model too – listen to this conversation among colleagues in this sector. This is a video made by one of the world’s biggest private jet companies, Luxaviation:”

Interviewer: “Do you get many clients asking for sustainable fuel?”

Colleague 1: “Well, I think we need to work on that as an industry, I think we do a lot, we’re starting to look at sustainable aviation fuel to run some of the aeroplanes, er we’re starting to look at more efficient engines and I think we can, we can work, you know within our parameters, we’ve got to do as much as we can to convince people that we’re part of the overall transport plan. I think going forward, you know, one of our questions is the perception of business aviation, it’s going to be a challenge for us.”

Naomi: “Hm. And it’s not just public perceptions they’re worried about:”

Colleague 2: “I mean you only have to look to the US and see you know there are several people who are tracking every aviation flight, you’ll see Bernard Arnault has just sold his aircraft based on the tracking and the sort of sustainability pressure, and some of the large pharmaceutical companies have decided to sell up their fleets as well. I think we’d be kidding ourselves to think that they are no longer flying privately, I think they’re probably going to less trackable methods.”