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Air Taxi-Air Charter – What is the difference in pricing?

The term "air taxi" refers to aircraft service that provides transportation to people on demand. This is that you can take a private plane flight when you want to go instead of booking a previously scheduled flight. Air charter is a form of air taxi, but there is a new class of aircraft and new business models that redefine "air taxi" as meaning something less expensive than a conventional charter. The idea behind the air taxi system is that the aircraft operator will be able to reduce the number of empty flights the plane makes.

Air Charter:

Let's say you booked a flight on Cessna Citation S / II (CE-S550). This light aircraft can rent an hour anywhere from $ 1500 to $ 3,100 depending on the age of the aircraft, amenities and operator qualifications. For our purposes, we'll assume a typical rate of $ 2,000 an hour. This price includes the costs associated with operating the aircraft such as the pilot’s salary and fuel costs, but it does not include some additional fees that may significantly add to your expenses such as:

Taxes – generally 7.5% of the total price.

Reposition Fee – Suppose you want to travel from Santa Monica, California but the plane is in San Diego. The aircraft operator will need to send the plane blank to pick you up and then return it blank to San Diego after landing in Santa Monica at the end of the flight. Repositioning adds these expenses to the operator’s minimum and is generally added to the cost at a reduced hour rate.

Waiting and waiting fees – let's say your flight is traveling from Santa Monica to Las Vegas on the same day. The pilots will wait for you for several hours and you will be charged an hour for the time of the pilots. If your flight calls for a one-night stay, fees may apply to hotel rooms for pilots and overnight parking fees for the plane. These fees vary according to local prices.

Minimum Daily Fee – Most aircraft operators have a two-hour minimum operating fee for chartered planes. If you need to go on a one-hour trip in each direction and complete the legs of the trip in one day, then you meet the minimum usage requirements and you will only need to pay for the two hours you use on that day. If, on the other hand, your flight is scheduled to fly one hour on Friday and then return for one hour flight on Saturday, you will likely be charged for two hours on Friday and two hours on Saturday for four hours, although the plane flies only for two hours. This industry standard practice exists for the "time is money" principle. Aircraft carry expenses even when sitting idle.

Air taxi:

There are two distinct pricing models in the air taxi model that can be used, and each aircraft operator will determine what to use, Entire Aircraft or per seat:

Entire Aircraft – Again, we will use Cessna Citation S / II in this example, but the hourly rate will be higher than the rental rate of the aircraft; let's say about $ 2,500 an hour in this example, but you will not be charged for resettlement or waiting for one night One or waiting for landing or any other fees. It will be a simple price per hour for pick-up and drop-off. After the plane crashes, it may take another customer on a flight. Your return flight may be on the same plane, or it may be on a different plane, or even at another company. This type of air taxi service may only be available between certain airports that have sufficient traffic to maintain profitable use of the aircraft.

Per seat – Citation S / II has 7 passenger seats. If they make a journey of less than 7 passengers on board, the operator will lose money if they divide the fare by the number of seats. Therefore, they will fix their prices in one of two ways:

1) Divide the full price by the number of passengers physically on board for each flight. Suppose you are traveling with two colleagues and there is another group of two that will travel with you for a total of five passengers. Seat price will be $ 2500/5 = $ 500 per seat. If your group is the only one on the plane, then the price per hour for each seat: $ 2,500 / 3 = $ 833 per seat.

2) Divide the price completely by the average number of passengers carried by the operator on each flight. Let's say the operator has been directing SMO to the LAS route for quite some time, and they have decided that they can get an average of 2.9 passengers per trip. If the operator uses this pricing strategy then it will charge you $ 2500 / 2.9 = $ 862 per seat per hour. This will be the same price regardless of the number in your party.

Single seat price will be available only among limited city pairs with traffic volume to keep the plane filled with passenger pay. If you want to travel to an airport outside the city network for every seat, you may need to hire the entire plane because seat prices are not available.

It's all about efficiency:

The emerging air taxi business model brings more efficiency to the aircraft rental model. Reduced waste will be equivalent to lower greenhouse gas emissions, increased productivity and lower final costs. Air Taxi is expected to become more affordable and cheaper as VLJs are produced and available for charter flights and air taxi flights. These planes promise to provide services at 20% to 40% off current light jet aircraft such as those in the example. As of this writing, about 100 VLJs have been produced and a handful of them find their way to air taxi companies along the East Coast and Chicago area. But this is another story.