Category: NetJets

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NetJets

NetJets Plunks Down $312 Million for 4 Additional Bombardier Global 8000 Aircraft

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Aircraft manufacturer Bombardier has announced that NetJets will become the fleet launch customer for the Global 8000 aircraft. Adding to its already massive global fleet of more than 850 aircraft (and still growing), NetJets has placed a new firm order for four Global 8000 aircraft, valued at $312 million dollars and converted eight existing orders for Bombardier products.

The transaction adds to Global 7500 aircraft already on order and in service. NetJets will build a 24-strong fleet of the performance leading Global 8000 aircraft, as they will also be working with Bombardier to upgrade the entire in-service Global 7500 fleet to Global 8000 jets when they begin taking delivery of its new flagship aircraft. NetJets could subsequently grow its fleet—the world’s largest, most diverse fleet in private aircraft—through a series of options that could be exercised progressively over the coming years.

Introduced earlier this year at EBACE in Geneva, Bombardier’s flagship for a new era features an industry-leading range of 8,000 nautical miles and an unbeaten top speed of Mach 0.94. This ultimate all-in-one business aircraft will offer NetJets Owners a unique blend of outstanding performance, the smoothest ride, and an exceptional passenger experience focused on uncompromising safety and service standards that only NetJets can provide.

“The new Global 8000 aircraft is the ultimate solution for NetJets’ discerning Owners, offering a truly seamless private aviation experience,” said Eric Martel, President and CEO, Bombardier. “NetJets’ experience and expertise make them the ideal partner to unlock the full potential of this revolutionary Mach 0.94 business jet in a large fleet context. Our valued relationship continues to grow stronger, and we are proud to share this historic milestone together.”

“The new Global 8000 will help us to continue offering our Owners, specifically our international travelers, the pinnacle in unforgettably personalized experiences aboard the finest ultra-long-range aircraft available,” said Patrick Gallagher, NetJets’ President of Sales, Marketing, and Service. “With inventory sold out through 2023 in the U.S., we are continuing to invest in further expansion for prospective Owners in North America and across the globe. In fact, by the end of 2023, we are proud to share that our worldwide fleet will be approximately 30% larger than it was in the beginning of 2022.”

The discerning Global 8000 business jet features the most generous cabin size in the industry, with the lowest cabin altitude in its class of 2,900 feet when flying at 41,000 ft. It is also equipped with Bombardier Pũr Air and advanced HEPA filter technology for the fastest fresh air replacement.

The Global 8000 aircraft delivers when it comes to in-flight experience. The cabin incorporates the revolutionary features introduced on the Global 7500 aircraft that dramatically improve passenger comfort. The aircraft also features the innovative Nuage seat, with the first-ever zero gravity position in a business jet, allowing NetJets Owners to arrive at their destinations revitalized and refreshed.

An exemplary commitment to detail is assured on the new Global 8000 aircraft, including an available Principal Suite with a full-size bed. Revolutionary cabin entertainment control and connectivity, the intuitive nice Touch CMS and OLED touch dial, Bombardier’s l’Opéra directional audio sound system and available 4K monitor, also ensure passengers will receive an unrivalled cabin experience.

Performance-wise, the new Global 8000 aircraft can efficiently transport NetJets Owners to a wide variety of destinations both faster and farther than ever before. With its exceptional class-leading range and short-field performance, even more exclusive city pairs are now achievable, including Dubai-Houston, Singapore-Los Angeles, London-Perth, and many others.

© 2022 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

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NetJets

NetJets Building Exclusive-Use Facility in Scottsdale, Arizona

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Berkshire Hathaway’s NetJets has broken ground on a new NetJets exclusive-use facility in Scottsdale, Arizona.

The first from-the-ground-up NetJets Maintenance Service Hub will significantly improve direct collaboration with the company’s supply chain partners.

Securing ramp space will limit traffic congestion and fuel delays and improve on-time performance.

The new facility in Scottsdale is part of the larger worldwide network of 10+ NetJets Maintenance Service Hubs—all located in regional facilities where NetJets owners travel to and from the most.

Owners can also take advantage of the on-site private boarding lounge where they can relax pre-flight.

“At NetJets, our priority is to provide Owners with safe, exceptional, and seamless experiences,” said Brad Ferrell, NetJets’ Executive Vice President, Administrative Services. “Our ongoing investment in expanding our real estate portfolio will continue to improve our industry-leading service, Owner experience, and maintenance abilities. We are excited to introduce our first from-the-ground-up NetJets Maintenance Service Hub site as a part of this larger investment in dedicated facilities across the globe.”

© 2022 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

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NetJets

Jet Deliveries Begin for NetJets’ China Partnership

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Berkshire Hathaway’s NetJets has begun delivering Gulfstream G450s for its China market partnership with Shenzhen, China-based Amber Aviation. The partnership will see NetJets provide up to 20 aircraft to Amber Aviation.

The partnership is part of a new Jet Card, membership club and shared lease programs. In addition to planes, NetJets is also providing service support, sales assistance, product design and legal support.

“This partnership with Amber Aviation offers NetJets a unique opportunity to provide long-term service in the Asian Market to our owners,” said NetJets Chairman and CEO Adam Johnson. “The team at Amber Aviation shares NetJets’ commitment to safety and service, and is a truly collaborative partner that we look forward to working with alongside our respected co-investors.”

Amber Aviation chairman Chang Qiusheng first joined the aviation sector in 1981 and has served in various management positions in the field for over 30 years. Prior to founding Amber Aviation, Mr. Chang established Business Aviation Asia Limited where he served as Chairman and General Manager. He guided the firm to become the largest business jet management company within a period of ten years. Mr. Chang has also served in senior management positions in Beijing Air China Aviation Service Corp., Air China VVIP Office and Air China Business Jet.

This is not the first go around for NetJets in China. NetJets previously had a China joint venture formed in 2012 with Hony Jinsi Investment Management (Beijing) Ltd and Fung Investments, but the partnership was scrapped in 2017.

© 2022 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

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NetJets

NetJets’ European Fleet Reaches 100 Jets

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Berkshire Hathaway’s NetJets has added its 100th jet, a Cessna Citation Latitude, to its Europe-based fleet, as part of its $2.5 billion fleet investment.

“NetJets is proud of its unwavering commitment to safety, service, and unmatched global access,” Christian Luwisch, executive director of NetJets Europe, said. “This landmark achievement is a testament to all at NetJets continuing to deliver exceptional service and access to our owners.”

Netjets has been experiencing record demand, and 55 aircraft to its global fleet of 800 aircraft in 2021. Its plans for 2022 include the purchase of more than 75 new aircraft, and the company has slowed the decommissioning of aircraft.

Looking towards a lower carbon future, NetJets signed a Memorandum of Understanding with German aerospace company Lilium for the prospective¬ sale of up to 150 Lilium electric vertical take-off jets, plus related after-market services.

The proprietary technology at the core of the Lilium Jet is Ducted Electric Vectored Thrust (DEVT), which has zero operating emissions.

© 2022 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

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NetJets

Lilium and NetJets Sign MOU for Purchase of Electric Vertical Take-Off and Landing Jets

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German aerospace company Lilium and Berkshire Hathaway’s NetJets have signed a Memorandum of Understanding for the prospective sale of up to 150 Lilium jets plus related after-market services.

Lilium is looking to produce the first electric vertical take-off and landing jet.

The proprietary technology at the core of the Lilium Jet is Ducted Electric Vectored Thrust (DEVT), which has zero operating emissions.

According to the company, the Lilium Jet can adapt for a range of customers and uses, with each configuration optimized for an unparalleled experience. The most spacious cabin arrangement is designed for private flights, with luxurious club seating. Alternatively, the cabin can be configured with 6 seats for passenger flights, or without seats to serve the zero-emissions logistics market.

Lilium announced the signing of the MOU in its 2021 FY Letter to Shareholders.

© 2022 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

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NetJets

NetJets Returns to China Market With Amber Aviation Partnership

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Berkshire Hathaway’s NetJets is returning to the China market by partnering with Shenzhen, China-based Amber Aviation. The partnership will see NetJets provide up to 20 aircraft to Amber, with the first aircraft to be delivered in April 2022.

The partnership will be part of a new Jet Card, membership club and shared lease programs. In addition to planes, NetJets will also provide service support, sales assistance, product design and legal support.

“This partnership with Amber Aviation offers NetJets a unique opportunity to provide long-term service in the Asian Market to our owners,” said NetJets Chairman and CEO Adam Johnson. “The team at Amber Aviation shares NetJets’ commitment to safety and service, and is a truly collaborative partner that we look forward to working with alongside our respected co-investors.”

Amber Aviation chairman Chang Qiusheng first joined the aviation sector in 1981 and has served in various management positions in the field for over 30 years. Prior to founding Amber Aviation, Mr. Chang established Business Aviation Asia Limited where he served as Chairman and General Manager. He guided the firm to become the largest business jet management company within a period of ten years. Mr. Chang has also served in senior management positions in Beijing Air China Aviation Service Corp., Air China VVIP Office and Air China Business Jet.

This is not the first go around for NetJets in China. NetJets previously had a China joint venture formed in 2012 with Hony Jinsi Investment Management (Beijing) Ltd and Fung Investments, but the partnership was scrapped in 2017.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

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NetJets

NetJets Europe Begins Flying on Sustainable Aviation Fuel

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Berkshire Hathaway’s NetJets Europe is the first to purchase certified sustainable aviation fuel in Spain from Air bp, the international aviation fuel products and service supplier that is the aviation division of bp.

Spain is one of the largest global aviation markets.

The ISCC PLUS certified sustainable aviation fuel (SAF) was produced at AIR bp’s Castellon refinery and is available across the Air bp network in Spain.

The fuel is produced from waste based sustainable feedstocks procured by the refinery and co-processed with fossil fuel to create a synthetic low carbon fuel. SAF is certified using International Sustainability and Carbon Certification (ISCC) PLUS procedures. This is the first time that Air bp has sold SAF using the ISCC PLUS certified method.

The Co-processing is a key step in replacing fossil fuel with renewable feedstock within refineries and helping to advance the decarbonization of transport including aviation.

The ISCC PLUS certified SAF claims an attributed saving of around 80 percent carbon emissions over its lifecycle compared with conventional jet fuel it replaces.

Christian Luwisch, NetJets Europe, executive director, said, “We are proud to collaborate with Air bp to supply SAF for NetJets’ aircraft in Europe. This new partnership is an important next step in our ongoing commitment to reduce the environmental footprint of our company. Our Owners will now benefit from this supply of SAF which we expect to be in the region of 325,000 USG during the first 12 months.”

Martin Thomsen, CEO, Air bp, said, “We are excited to announce our first sale of SAF in Spain, which opens up new supply opportunities in an important aviation market. We are also delighted to have the support of our customer, NetJets Europe, which demonstrates their willingness to invest in SAF to help reduce carbon emissions. We hope this announcement will encourage more customers to purchase SAF in Spain. We believe SAF is one of the aviation industry’s key routes to reducing carbon emissions, and ISCC PLUS certified SAF is the first step towards developing new refining and commercial solutions, including those that achieve CORSIA certification, to keep decarbonizing our offers for our aviation customers.”

Air bp notes that it was involved in fueling the first SAF flight by an airline in February 2008 and since then has been enabling ground-breaking test flights and investing in sustainable alternative fuels. To date Air bp has supplied sustainable aviation fuel to over 20 airports.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

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NetJets

NetJets Has Record Demand

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Business is booming at Berkshire Hathaway’s NetJets, with the company experiencing record demand that has eclipsed anything in its 57-year history.

The company has been forced to pause its sales of fractional shares, leases, and jet cards for its Cessna Citation XLS and Embraer Phenom 300 jets because of “unprecedented demand within the private travel industry,” AIN reports.

NetJets is currently hiring 150 pilots to meet the demand, and is also hiring additional service personnel. It aims to have 100 pilots fully trained by October.

The company will add 39 new private jets to its U.S. fleet by the end of 2021, and is scheduled to add 40 planes a year over the next decade.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

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Commentary NetJets

Commentary: The NetJets Dream of a Fleet of Supersonic Jets Gets Grounded

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Berkshire Hathaway’s NetJets has had its planned fleet of supersonic business jets abruptly grounded as the jet supplier Aerion has gone out of business.

Competition in the fractional jet ownership business in the fledgling supersonic airspace had been heating up as NetJets and its main competitor FlexJets prepared to spend billions on the return of supersonic flight for the business jet market.

Supersonic flight would give these companies a substantial competitive advantage over commercial airlines in their competition for first class customers, especially for long distance overseas flights.

In 2015, FlexJet became the first fractional jet ownership company to place a firm order for the jets when they ordered twenty of Aerion’s AS2 aircraft, and NetJets followed suit with twenty orders of its own.

The proposed Aerion AS2 was to be a three-engine jet with a minimum projected range between 4,750 nautical miles and more than 5,000 nautical miles. Technological breakthroughs were supposed to reduce or eliminate the sonic booms that had limited the Concorde to routes that were over water.

Aerion claimed that at speeds around Mach 1.2 a “sonic boom would, essentially, dissipate before reaching the ground.”

The potential of the Supersonic Market

Supersonic business jets would fall into an interesting category of jets that if built will have a decided advantage over other private jets, but will be too expensive for most people to own outright. While the supersonic business jet market offers opportunity, it also comes at a high cost, with the price of each jet at over $100 million. That’s the perfect opening for fractional ownership companies to plot their growth.

Only the fractional ownership companies with the deepest pockets, such as NetJets, would able to compete in this market, giving them a clear advantage over smaller charter companies, and a major capability advantage over commercial airlines.

It will be interesting to see if NetJets or FlexJets put down purchase options with any of the other companies looking to get into the supersonic airspace, but for now, the dream of cutting flight times in more than half are grounded.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

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Commentary NetJets

Commentary: NetJets Makes High Speed Move Into Supersonic Jets

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Competition in the fractional jet ownership business is getting fiercer, as the biggest players, Berkshire Hathaway’s NetJets, and its main competitor Flexjet, prepare to spend billions on the return of supersonic flight for the business jet market.

Supersonic flight will give these companies a substantial competitive advantage over commercial airlines in their competition for first class customers, especially for long distance overseas flights.

The new supersonic business jets will fall into an interesting category of jets that will have a decided advantage over other private jets, but will be too expensive for most people to own outright.

While the supersonic business jet market offers opportunity, it also comes at a high cost, with the price of each jet at over $100 million.

That’s the perfect opening for fractional ownership companies to plot their growth.

In 2015, Flexjet became the first fractional jet ownership company to place a firm order for the jets, when they ordered twenty of Aerion’s AS2 aircraft.

Now, Aerion has made an expansive collaboration with NetJets and FlightSafety International, two Berkshire Hathaway companies, which will be sure to impact the private jet market.

Underlining the long-term focus of the partnership, NetJets has also obtained purchase rights for 20 AS2 supersonic business jets.

Aerion will start production at Aerion Park in Melbourne, Florida in 2023.

With significant growth achieved through 2020 and 2021, Aerion’s global order backlog for the AS2 is now valued at more than USD $10 billion. The new AS2—the first supersonic aircraft to enter commercial service in 51 years and the world’s first supersonic business aircraft— continues to advance toward manufacturing start after concluding wind tunnel validation late last year.

“As the leader in private aviation, we constantly look for ways to be on the cutting-edge, and expanding our fleet to become the exclusive business jet operator for Aerion Connect is a thrilling next step,” said Adam Johnson, Chairman and CEO of NetJets Inc. “Together, we will be exploring the integration of the AS2 supersonic business jet into NetJets’ global network, and we are honored to be their chosen partner to enable the Aerion Connect vision.”

Aerion will explore NetJets’ becoming the exclusive business jet operator for the global mobility platform, Aerion Connect. A vision for a future global mobility ecosystem, Aerion Connect will integrate multiple, currently siloed urban and regional networks and provide a seamless point-to-point travel experience, optimized for speed and luxury across multiple modes of transportation.

In collaboration with FlightSafety International, the premier professional aviation training company, Aerion will also develop a supersonic flight training academy for civil, commercial, and military supersonic aircraft. The Aerion-branded facility will channel FSI’s comprehensive global training expertise to provide a center of excellence for supersonic flight training and education, shaping the flight crews of the future.

The supersonic planes will give corporate leaders and other high-end travelers a compelling reason to consider fractional ownership. Even cross-country travel, which draws additional concerns about sonic booms, will be faster.

Aerion claims that its Boomless Cruise flight is feasible at speeds up to Mach 1.2, depending on atmospheric conditions, principally temperature and wind.

The company hopes that the U.S. will adopt International Civil Aviation Organization (ICAO) standards, permitting supersonic speeds over the U.S. Supersonic flights are currently prohibited.

Aerion claims that at speeds around Mach 1.2 a “sonic boom would, essentially, dissipate before reaching the ground.”

The Aerion AS2

The Aerion AS2 is a three-engine jet and is larger than the originally conceived Aerion supersonic business jet. Fuselage length is 160 feet and maximum takeoff weight is 115,000 pounds. Minimum projected range is 4,750 nautical miles with the intention to achieve a range of more than 5,000 nautical miles.

The aircraft will have a 30-foot cabin in a two-lounge layout plus galley and both forward and aft lavatories, plus a baggage compartment that is accessible in-flight. Cabin dimensions widen from entryway to the aft seating area where height is six feet, two inches and cabin width is seven feet, three inches.

Carrying eight to 12 passengers, the AS2 has an intercontinental-capable range of 4,750 nautical miles at supersonic speed.

One thing that is clear, only the strongest of the fractional ownership companies will be able to compete in this market, giving them a clear advantage over smaller charter companies, and a major capability advantage over commercial airlines.

© 2021 David Mazor