Among perks in the C-suite, access to private jet travel may seem like the most extravagant option out there. Business travelers get to not only skip the inconveniences of commercial airline travel, but they are also guaranteed a seat, even the entire plane if they wish, and make it out and back in time for dinner.
For those lucky enough to land it, private jet travel is the way to go, and plenty are enjoying the ride these days, according to private research firm Equilar. It’s growing increasingly common on the menu of executive benefits, in third place after plan-based contributions and insurance premiums. Even a company car comes in fourth on the list.
In San Antonio, besides corporate jets owned by employers like USAA and NuStar, executives have direct access to four major charter jet services, and six others that charter flights in and out of here, though they are based in other cities, said Brian Schmitt, general manager of Million Air, a fixed base operator near the San Antonio International Airport. Nationwide, the charter-flight industry is a $20 billion business, according to a recent analysis by IBISWorld.
So in an age when commercial travel can occur in the not-so-friendly skies, private air travel is providing necessary convenience, comfort, and privacy, according to those who enjoy the perk. But one such provider here is out to prove that even luxury can be economical.
Merlin1 CEO Jim Foody purchased his first plane, a Merlin IIIB turboprop, in 2007 with the goal of spending less time in the air. Tired from weekly business trips to Miami on a commercial airliner, Foody jumped in to ownership, knowing he could cover the $1 million cost by leasing it to his golf buddies.
Fast-forward to 2016, and Foody now operates five turboprops, two light jets and, most recently, a mid-size jet airplane, the sleek and luxurious Learjet 60.
“I had no intention of having even four. I wanted two. I knew if I could generate enough to offset my travel, that would be perfect,” Foody said. But when GE Capital got into the conversion business, effectively knocking smaller conversion businesses like Foody’s out, he knew he had to go bigger.
And knowing there was a market for a San Antonio-based business providing travel within Texas, especially within the oil and gas and construction industries, he began marketing Merlin1. But competition existed.
“My idea was if I could be the low cost producer with a very high level of service I may have the opportunity to build a brand, and that’s what we set out to do,” said Foody, a Seattle native who had worked in the airline business more than 35 years and earned his pilot’s license at age 17.
“I knew the successful party would be the one that is the lowest cost producer, and that was my objective. With a turboprop versus a light jet, that markets up to 300 miles where speed doesn’t make that much of a difference, maybe five minutes on elapsed time en route – no one could touch our pricing.
“And even though this could be deemed as a luxury product, if you’re a business person, the bottom line is always important.”
Merlin1 sells blocks of time that range from $2,600 to $4,600 per hour, depending on the plane, and subscription plans start at 25 hours a year. You can transport as many as will fit on the plane, or fly solo. There’s also an open seat program that lets customers fly at no charge when the plane is scheduled to fly to another city like Houston, for instance, to pick up passengers there.
Unlike the business model of a company like Dallas-based RISE, subscribers decide when and where they want to fly to, pick up the phone, and book it. They then drive onto the tarmac at the appointed time, step onto the plane, and can be airborne within five minutes. Merlin1 will arrange rental cars, catering and even birthday celebrations or special beverage requests. On your return home, they’ll have your car waiting for you, engine running, and the air cooled or warmed.
“Multiple site visits can be conducted in one day, meetings can be conducted en route while getting key managers home for dinner,” said Randy Pawelek, executive chairman of Bartlett Cocke General Contractors, who uses Merlin1 to reach job sites. “The wear and tear on key managers is greatly reduced and projects managed greatly improved.”
Satisfied clients like Pawelek soon wanted more, and asked Foody to invest in a jet, even committing to buying 200 hours of flight time to support the cause. With that assurance in hand, Foody bought a Learjet 35 to take people as far as places like Chicago, the West Coast, Boston, New York, and Charlotte, N.C. – too far for the Merlin which only can go a three-hour distance to cities in Mexico or to Denver.
But demand increased again and Foody bought another plane. Then the same frequent fliers told him they wanted more head-room comfort so Merlin1’s fleet expanded last November with the Learjet 60, a medium-range business jet aircraft that has a top speed of 521 mph. The price tag: $2.5 million.
The goal now is to get the spacious, leather-upholstered six-seater fully booked.
“To a corporation, [chartered private jet travel] is not a huge expenditure. At issue is they don’t know about it. Or they view it as so extraordinarily expensive that they don’t even look into it,” Foody said. “When they finally do, they go ‘Oh wow, I’m moving six guys to two cities in Texas and getting them home for dinner.’ It’s cost-effective. Then we’ve got a lot of entrepreneurs, like one guy I take to Santa Monica every Tuesday. Out in the morning and back for dinner.”
Private jet travel isn’t just for business anymore. According to the Economist, executives are now using corporate jets less for business, and more for leisure. At Merlin1, most of their bookings are business travel but about 25% is for leisure – to places like mountain ski resorts in Colorado, beach destinations in Mexico, and Santa Fe, N.M.
The Learjet 60 can get you from San Antonio to New Orleans in one hour.
The jet itself may be efficient and fast, but Foody is happy with the slow and steady growth of his company and he has no plans for a national presence.
He currently contracts with 20 experienced pilots – most of them retired from commercial airliners or who served as military pilots – and Foody said his clients appreciate that sense of security.
“It’s the reason I sleep better at night, but it also puts a limit on our growth,” he said. “My desire is simply to be the best service provider for people based in Central Texas.”