How the Company that Invented the Sharing Economy Is Innovating
In their original business plans, Uber referred to itself as “the NetJets of car services.” Perhaps it’s because more than 30 years ago, NetJets was the original innovator and advocate for the concept of shared ownership. Pioneered by the company in 1986, shared ownership created a new segment within the general aviation market. Today, after seeing many competitors come and go, NetJets (a Chicago Ideas partner) is celebrating more than 50 years as the worldwide leader in private aviation. Not only that, they recently celebrated “Jet Equinox”—the moment when the company’s fleet of new aircraft outnumbered legacy aircraft. We spoke with NetJets’ Executive Vice President of Sales & Marketing Pat Gallagher about how the company’s dedication to service, safety, and innovation (they even monitor pilots’ circadian rhythms!) has allowed them to thrive.
You’ve been compared to Uber. Can you tell me a little bit about how the NetJets process works for co-owners/card holders?
Simply put, shared ownership is the smartest way to fly privately because it offers ownership at a fraction of the cost, time, and effort. Today, you can fly with NetJets by purchasing a Share, Lease, or Jet Card. Each has unique advantages and is customizable to meet the travel needs of each individual customer.
We are often compared to charter companies, but there’s quite a difference. First, we’re always in complete control of our fleet, so you’ll never wonder where or by whom your plane has been maintained. With a charter provider, you’ll notice that their maintenance and training standards vary greatly by provider. Multiple providers may be involved in maintaining the aircraft and hiring and training pilots.
While our customers enjoy complete accessibility to their aircraft and the ability to exchange to a larger or smaller aircraft type, with charter providers, availability and response times vary greatly and often aren’t guaranteed. For instance, a backup aircraft and crew isn’t guaranteed in the event a maintenance issue occurs, which may impact your cost. And charter aircraft tend to be older, whereas most of our fleet only averages 8.8 years old. With NetJets, the cost is predictable for the entire term of contract. You only pay for occupied flight hours, with no hidden fees and no ferry (positioning) fees.
How does NetJets approach innovation?
We leverage insights gained from over a half-century of perfecting private jet travel, and apply it to create even smarter technologies and innovative solutions. One example that we use every day is IntelliJet II, our proprietary reservation and flight-tracking system. We also have the Waypoint app, which keeps our flight operations and pilots in constant communication, assuring the pilots have the most up-to-date flight information and owner preferences, without fail. We even monitor and analyze crewmember alertness based on circadian rhythms, sleep and travel pattern, and other variables. This kind of cutting-edge technology allows us to concentrate on the safety of our customers, pilots, and crew at all times.
You began as the first private jet charter and aircraft management company in the world, starting with only 10 aircraft. Fast-forward 50 years and you now offer the largest, most diverse fleet of approximately 700 aircraft worldwide, with the ability to access more than 3,200 airports in over 150 countries. How were you able to scale?
We’ve been able to steadily grow our fleet by continually moving forward with innovative, yet incremental, improvements. This includes listening to the needs and desires of our customers and implementing their feedback as we grow and evolve our fleet. Most recently, we’ve made significant internal advancements. These include placing the right people in key positions, thereby ensuring safety remains our top priority.
What is it about NetJets’ business model that has allowed it to thrive for more than 50 years in an industry that’s changed drastically since then?
We’ve proven that we are a business that can withstand economic and industry hardships. One way we do it is by focusing on long-term wins, not short-term gains. Our priorities are safety, then service, and that has never changed. Our approach to everything reflects this.
What makes us most proud, though, is the fact that we have a high percentage of customers who are likely to recommend us. Which, of course, is the biggest compliment of all because that tells us that we’re truly delivering on our mission to deliver exceptional travel experiences on every flight, for every customer.
How does NetJets approach safety?
It begins by hiring only the most experienced pilots. Our new pilots average over 10,500 hours of flight experience—that’s 10 times the industry requirement. And it doesn’t stop with our pilots. We have our own in-house, FAA-approved meteorologists as well as 18 full-time team members dedicated to safety—that’s double the staff of any other private aviation company. For 17 years, we’ve been recognized for the proactive and extensive training of NetJets Aviation Maintenance Technicians with the FAA Employer Diamond Award of Excellence.
What does exceptional service mean to you?
To us, exceptional service means creating a personalized travel solution that meets customers’ specific needs. After that, every single flight should exceed their expectations. We do this by providing clear, constant communication with a dedicated Owner Services Team that’s available 24/7/365. We get to know our customers’ preferences so that every flight caters to their exact needs and wants. And whenever possible, we like to go above and beyond, whether that’s a surprise birthday celebration in route to Disney complete with princess attire and cupcakes, or simply having the customer’s favorite drink ready at takeoff.
We’re also known for easy, timely access to almost any location in the world, no matter how remote. And we’ve fostered long-standing relationships with like-minded businesses across a variety of industries that our customers are passionate about. This allows us to offer our customers special benefits and access to once-in-a-lifetime events and opportunities—simply because they’re a NetJets Owner.
How has your partnership with Berkshire Hathaway influenced your approach?
The financial backing of Berkshire Hathaway allows us to do whatever it takes—and invest as much as necessary—to remain committed to the highest safety standards and maintain the best aircraft in the sky. We go to extraordinary lengths when it comes to safety training. In fact, we spend $80 million annually in pilot and crew training; they return twice a year to FlightSafety International for extensive training. (Federal regulation requires they train only once a year.) And we have some of the youngest aircraft in the sky, built with the newest, most cutting-edge avionics.
It’s being a part of the Berkshire Hathaway family that helps guarantee our customers experience the unmatched safety, service, and reliability we’ve been known for more than 50 years.
I’ve read that it only took Warren Buffett one NetJets flight before he knew he was interested in investing in the company. Can you describe an “aha” moment you personally have had regarding NetJets, where you found yourself excited to be working for the company?
Often when I meet with our customers, especially those who have been flying with us for many years, I hear stories about how NetJets is woven into so many of their best memories. They talk about the family vacations and the births of grandchildren that they’ve been able to get to. They talk about how they’ve been able to grow their businesses while never having to choose between taking the meeting in person and being at a child’s sporting event or recital. They share how they’ve been able to dive into philanthropic causes without taking time away from their businesses or families. That’s when I’m most excited to be working for NetJets. When I hear a story of how we were able to help an Owner do more and miss less.
IntelliJet® is a registered service mark.
FlightSafety International® is a registered trademark of Flight Safety Development Corp.