May 2020, at the height of a Covid-19 global pandemic, NetJets* saw its biggest month for new customer acquisitions since December 2007, its CEO Patrick Gallagher told delegates at Corporate Jet Investor Global 2020.
“Now things are starting to thaw out and markets are beginning to open up, we are starting to convert interest into customers and May was our largest month for new customer relationships since December 2007. We we certainly weren’t seeing that a couple months into the recession of 2008.”
Whilst demand had fallen “off a cliff edge” in mid-March bottoming out in mid-April, Gallagher said customer interest and interaction did not follow the trend. Now the leisure side of NetJets has returned to pre-Covid levels, Gallagher notes NetJets is benefitting from customers, who had previously viewed private aviation as luxury, seeing it as a necessity for safe travel.
NetJets’ largest business segment is corporate aviation. This felt an immediate impact from Covid-19 as business ground to a halt, according to Gallagher. “Our existing customers are not exercising their rights to put back shares, which tells you that people don’t want to let go of that access to private aviation. [Nonetheless] Our corporate flying remains way, way down and we are not seeing it come back yet like leisure has.”
With minimal business travel taking a place it will be a little while before we see activity levels return in corporate aviation, said Gallagher. “ [We’ve been having] Anecdotal conversations with our clients. Some of them are saying they are going to expand access to private aviation for those in their company, which is good news for our industry. But I don’t want to be optimistic or polyamorous here in thinking that there won’t be some long-term financial impact to our industry overall.”