Is there any future for empty legs in Latin America and the Caribbean?
Only a few years ago air brokers, owners and operators in North and Latin America determined that about half of private jet flights were empty. We have since tried to find a way to best take advantage of this potential opportunity. In fact, the growth of the region’s aeronautical industry had led to a substantial increase in the size of fleets and the consolidation of numerous air services suppliers into large fleet operators (Empty Legs). Consequently, we realized we could put our aircraft anywhere we wanted and offer one-way flights which, by the way, became cheaper than double round trips. One-way flights pricing method implied, however, that customers would pay a higher hourly rate in exchange of the elimination of the responsibility of repositioning the aircraft back to base.
These measures allowed us to position our aircraft to a wider market as reposition flights increased. In other words, seeing that customers also booked one-way flights, we considered that there may be a market for empty returns, which implied no operational costs. An empty leg opportunity is, however, more complex than customers paying for one-way and the aircraft returning empty. The probability of finding another customer willing to pay the usual charter prices reduces considerably because it is very difficult to fulfill all his/her requirements (such as the type of aircraft, the specific route, departure date and time) and comply with scheduling, operating procedures and commercial policies at the same time. It is worth noting that the original customer practically owns the booked charter flight and he or she can delay the departure time or make late changes to the itinerary forcing the empty leg customer to fit their plans around them. For these reasons, empty legs are offered with discounts of up to 75% of standard jet charter prices.
Many specialists say that empty legs may threaten private aviation as they allow some companies to charge less than the competition, thereby bringing prices down. Since online brokers post lists of available empty legs hoping that clients will find the one they need, other experts consider that this modality could break a key principle of private aviation; that aircraft need to work around customers, not the other way around. Furthermore, not every empty leg opportunity fit some air services suppliers’ requirements. For example, South American Jets is a Wyvern certified broker with high safety standards. We always run reports on crew, maintenance and insurances, and check operator documentation, AOCs and flight rules. We never approve deals or charter flights that do not fulfill our standards, so we cannot offer lower prices than competitors who do not share our safety parameters.
I think, however, that empty legs have become an excellent way to increase revenue and make business aviation more attainable. First, it will always depend on customers; if they are flexible and can adjust their travel plans so they can match empty legs flight opportunities, we can offer this modality without affecting original charter flights. Second, in Latin America and the Caribbean, travelers who usually fly first class or want to enter the world of private aviation have become aware that empty legs are an excellent way of enjoying the comfort of private jet flights while saving money. There is, evidently, a significant potential for this market as projections suggest that it will continue to grow in the coming years. Finally, we can rest assured that empty legs will not affect charter flight demand as they depend on the original one-way charter flight – in other words, if there is no one-way private flight, there will be no repositioning flight. Furthermore, most clients will continue to avoid empty legs as they want personalized services and control over the main aspects of their flight such as scheduling, itinerary planning, and pilot and flight crew selection.
South American Jets