College Athletes Make Bank on BizAv Deals and Someone tries to steal a GIV

Jessie Naor (00:00)

good morning and welcome to the VIP seat. Today is September 5th and this week's top stories in private aviation include how college athletes are cashing in on the private jet market and an attempted business jet theft in Maryland. Your hosts today

yours truly, Jessie Naor and our guest today, Jacquie Dalton. So sit back,

up and let's take off.

All right, Jacquie, so this week, actually a couple days ago, my old home airport where Grand View Aviation used to be based out of had an interesting

A guy apparently drove onto the airfield, got into a Gulfstream and turned the engines on. And the pilot discovered him and said, hey man, what are you doing? Pretty wild story, but I will say, mean, small airports, these things can happen.

Have you heard of

like this before?

Jacquie Dalton (00:55)

just when you sent me the list I'm like only in our business only in business aviation

talking about you know stealing a 1984 G4 I would have gone for one of the either the G 150 on the field or one of Grandview's Phenom 300 but wild and

Jessie Naor (01:09)

It was easy, easy put -ems.

Jacquie Dalton (01:13)

pickings I guess he didn't you know he's a pilot

Jessie Naor (01:16)

Yeah, he has an ATP. I mean,

start digging into this a little more. The guy had an incident a few years ago, like 2017, involving a gun and something, some domestic disturbance of some kind. And I'm like, how in the heck does this guy, like, is he flying commercially? I hope not. I would think

Jacquie Dalton (01:34)

Well, he was arrested in 2016 for having unregistered firearms, like a, you know, had AR -15 and a silencer and a sawed -off shotgun. so I don't know where, you know, was he rummaging around the airfield? Did he work on the airfield? Is he still flying? Did he just decide, I need to steal a jet?

Jessie Naor (01:45)

Thank you.

You know, and this is like I so I've I've been on this airfield for many many years and it's

I Think this is the case with a lot of small airports, you know, usually nothing is happening And they're pretty quiet people aren't really paying attention to these locations, but I mean there

significant security risks I mean, I've seen some airfields that don't even have fences and I wonder how that even how that works, but

Jacquie Dalton (02:12)

yeah.

How does that work? Well, I mean, you just can never underestimate, you know, ground security line teams and, you know, it's, had to have been a private hanger. You know, it probably didn't have a

company. I mean, the owner of the jet was pretty interesting. He's a media guy. But, you know, I agree with you. You can get a little complacent and if incidents aren't occurring, you might think that you're.

Jessie Naor (02:32)

Yeah.

Jacquie Dalton (02:39)

You're safe and your assets are secure, but you could just never, it's a 24 seven industry. You can't cut corners

it comes to security.

Jessie Naor (02:47)

You can't. mean, you know, and just a simple thing of locking your airplane when you're not on it. You know, some people don't even do that.

Jacquie Dalton (02:51)

I thought about that too. like, why wasn't the airplane locked? It's probably like local teenagers like partying in the cabin and yeah, gotta lock up your airplane.

Jessie Naor (02:56)

I will say like, I mean...

Yeah. No, mean, people do get complacent, though, you

especially if you're, you know, prep your inside prepping some catering or whatever he was working on and then just decided to leave it unlocked for a couple of minutes and some guys snuck on it. Although I love that at his bail hearing, he was questioning the trespassing charges because he said that the security

him on the airfield, you know, and then that happens. They probably just waved him on. I've seen it happen before.

Jacquie Dalton (03:29)

He might get away with that one actually. He thinks that one should be dropped, but I'm with you. He's like, wait, he said, aren't these kind of severe charges? I'd be more concerned about the felony.

Jessie Naor (03:37)

Yeah, he said, I'd really like to go home. These charges are a little bit steep. That's what he said in the hearing. was crazy. It's a little, it's like, judge, it's a little steep.

Jacquie Dalton (03:46)

I've got to try that line. It's a little steep. think, you know, it's on your, lucky you weren't there, Jess You would have taken him down for sure. It wasn't going to be happening with you on the field.

Jessie Naor (03:57)

would have been speechless. Like, I don't know, you although I, when I see something, I say something, okay? You know, like I don't let that stuff slide.

Jacquie Dalton (04:02)

Yeah, now I hear you. See something, say something, for sure. His hearing is October 16th, so we have to put it on the calendar and see how goes.

Jessie Naor (04:09)

Ugh, well...

yeah, well we'll definitely do an update after that comes through. I want to see what charges this guy ends up with. folks, lock your airplanes out there.

Jacquie Dalton (04:17)

you

Jessie Naor (04:21)

a requirement 135, not 91, but still a good practice, I would think. So, and the next big news is, it was a huge news week actually in private aviation. We had a lot of stories coming at us. The next big one is, Fly Exclusive is now taking over Volato's managed fleet.

Jacquie Dalton (04:21)

Lock your airplane.

Amen.

Mm -hmm.

Jessie Naor (04:39)

They've been in the news a lot recently. There was layoffs and leases that were announced a couple weeks ago. The stock price has been below a dollar since June. So interesting concept. mean, at least they didn't go bankrupt and leave customers without

service, but definitely didn't see this one coming.

Jacquie Dalton (04:58)

Now, interesting news. See, I would have said, well, didn't see them moving over to fly exclusive

but definitely challenged overall. And the light jet market you're a lot more familiar with than I am, but it's a challenging model. And we saw Jet -It not be able to make it through. So I think this is an interesting way to try to resolve issues that are in play for Volato.

know, mean, fly exclusive taking this on, it's gonna be interesting to see how they're gonna handle, you know, because more isn't always better. know, bigger isn't always better and it's gonna be challenging and they've had to go through their own adjustments since going public and they do. They've been adjusting and making some good changes.

Yeah, you know, one of the things that I found really interesting was that the Volato wasn't operating under 91K on their fractional

Didn't you find that interesting?

Jessie Naor (05:45)

Yeah, I was really surprised by that. Yeah, because it listed when they sent the letter out to the fractional

that said, hey, but you get this great benefit now that you don't have to pay federal excise tax on your

fractional. Like, I thought everything was operated under fractional.

Jacquie Dalton (06:00)

Yeah, that really stood out to me. And then the other thing is what

offering is, right? Like, what are you going to get as a client? Because it's a big shift. when, you know, loyalty, when it comes to who you fly with, you know, really is important. So these people invested in and are committed to Volato. And now this is going to be a big change. So there's the 50 ,000, you know, 50 ,000 goes over and then you match 50 ,000 and then you get 130, right? There's this 30 % offering if you buy more and it's

You know, those situations always make me a little bit nervous. You know, how they're going to meet that demand, integrate the fleet. I think integrating the fleet will be

but it's going to be interesting to see how they're going to meet that demand for sure.

Jessie Naor (06:43)

Yeah, I mean, will say I think Fly Exclusive is a solid operator, you know, as far as

integrating, like they already have the infrastructure to dispatch flights and, you know, handle pilots and training and everything else. So think at least from that perspective, it's somewhat easy. But I mean, it's a cultural difference, rules difference. That's always, I mean, that was one of the challenges that Wheels Up had integrating a

bunch of businesses and different kinds of businesses into one platform. It's not without challenges.

Jacquie Dalton (07:10)

It's not without its challenges. And you know, I'm always

flight safety focus, flight safety focus as are you. And so when you take something like this on, that's, that's going to be, it's going to put some pressure for sure. And then fly exclusive just offloaded their G IVs and you know, their super mid so that they could get, things under control. And then you have a lot of coming in with these G 2 80s that they, they just bought, which I love the G 280s , but.

you know, that's going to, that's going to cause some challenges too. And then when you look at the numbers, if you look at the number of retail clients that they have and the number of aircraft and fractional owners, that always jumps out at me too. I feel like these retail programs that these operators get into can, can really present a challenge for them. And so now you're going to have to, you're going to have FlyX's retail program,

lot of retail program. So it's going to be interesting to see how they, how they handle it.

Jessie Naor (07:55)

Mm

Yeah. And it's tough to make money, especially in the light jet or smaller category. The problem is you still need two pilots up front and that's the expensive part. Training and flying them, mean, that's the most costly part of operating these businesses and to not have much higher hourly rate to offset that cost. It'll be interesting to see how the numbers pan out.

Jacquie Dalton (08:08)

Yep.

No, I agree. I, you know, also just the demand on the

and the aircraft themselves, these light jets and mid jets, I really moved a lot of my business away from it because just in terms of, know, they're running three, four flights in a day and it's just, you've got crew fatigue and delays and, you know, an increase in issues. And if you're not reining that in, it kind of snowballs.

I just don't want it to, I love FlyX So I just don't want it to see it disrupt their operations. But I wish the best for everybody.

Jessie Naor (08:46)

We shall indeed.

Jacquie Dalton (08:54)

hardest thing is the people who got let go. I've been hearing from some pilots, I think they let the 100 pilots go, heard, or it always affects the workforce.

Jessie Naor (09:01)

Yeah. Yeah.

No, but I do think, you know, at least pilots these days have some pretty lucrative career options and a lot of areas. mean, the airlines, the airlines have stopped a bit. You know, I think that that frenzy that we were in there for a while has kind of stopped, but it still pays to be a pilot right now. And lots of good 91 operations out there and private owners that are probably. Yeah, yeah, for

Jacquie Dalton (09:12)

Yeah, it's It's true.

Yeah.

Great opportunities for sure. Yeah, I agree.

Jessie Naor (09:31)

All right, last week we covered there was a seizure of a

aircraft by a Chinese investor. This week, in a pretty unprecedented move, the Department of Justice seized Venezuela's President Maduro's aircraft, It was in the Dominican Republic, so they were working together with the Dominican Republic agencies to do this. But apparently there was...

Jacquie Dalton (09:45)

I know.

Jessie Naor (09:54)

You know, obviously you were not allowed to sell to the Venezuelans under a number of laws out there. They registered their company in San Marino. So a shell company was set up in San Marino, which apparently allows anybody to get registered there. And then some company in Florida sold this aircraft to the colleagues of President Maduro. But wow, yeah, that's a lot of interesting

happening in the world stage with airplanes right now.

Jacquie Dalton (10:19)

Well, first of all, props to the selection on the jet that they bought. I love the Falcon 900 EX. It's one of my favorite long range aircraft and the efficiency and the performance is fantastic.

but you know, it's

say, you know, some company in South Florida and South Florida is always getting a bad rap, you know, and it's like, which company in South Florida did this deal? but it's not the only one, you know, I I think that there's a lot of this happened over the last few years, maybe at this not obviously not necessarily Maduro, but a lot of acquisitions occurred and you know, there's all that due diligence, you know, know your customer

Jessie Naor (10:38)

I know.

Yeah.

Yeah.

Jacquie Dalton (10:58)

I love that the secretary, assistant secretary for export, Matthew Axelrod at the department of commerce. loved his attitude. He's like, we're coming to get any airplane that was acquired. I'm like, go get them because we want them back. Bring them back to America. So we want more jets. Get every jet that left. Bring it back.

Jessie Naor (11:11)

Yeah. There you go. We went up, we're going to fly those planes. No, it's a beautiful plane. I think at the time it was valued at $13 million. you do wonder how this slipped through the Know Your Customer forms because even in the last few years, if you're doing any of these transactions, you you're supposed to know the LLC who owns it, all the different people involved in it. They get pretty detailed. So.

Jacquie Dalton (11:33)

Yeah.

Jessie Naor (11:36)

I guess it'll come out in the report eventually, but I think someone in South Florida is probably getting some phone calls right now.

Jacquie Dalton (11:42)

And I'm sure it was intentional that it's not in that story, that it hasn't been made public yet. But we come from management and charter operations, but I'm sure every whole aircraft broker out there who does their due diligence and operates with integrity, we certainly know a few of them. I'm sure they were like, see, this is the stuff that goes on when you let just anybody be a broker. Yeah, yeah, yep. Yeah.

Jessie Naor (12:01)

This is why you do this. Yeah, yeah. Well, and that's, know, I've talked to a number of people over the years too, that there, you know, there's no requirements for you to be an aircraft broker, you know, or a charter broker. And it's, yeah, and people don't realize that when they're doing these deals, you you

Jacquie Dalton (12:14)

or a charter broker.

Jessie Naor (12:19)

it's like the real estate industry and everyone knows what they're doing. Like,

don't know, it's, yeah.

Jacquie Dalton (12:23)

Isn't that crazy? You can't sell a house without a license, but you can put somebody 40, 50 ,000 feet up in the air with out one. But I think change is coming on that. think, and like you know, mean, all the initiatives that you've been involved in, takes time for them to kind of, remember you telling me last year, it takes time for things to get done. And I think this is just another example of why it's important that we know who is buying and selling airplanes.

Jessie Naor (12:52)

Well, and it's moments like this that create regulations. when they find out that somehow someone sold an aircraft to Venezuela, you know, despite the rules that existed, that's when, you know, regulatory agencies start to say, okay, maybe we actually need to manage this process a little more heavily.

Jacquie Dalton (13:01)

you

Which is a bummer because we those of us who self -regulate right and work together the right way It's you know, don't want to have to have regulation come in But obviously I agree with you had it who sold an airplane? To Venezuela

Jessie Naor (13:25)

Well, maybe, know, legitimately, they probably didn't know, you know, I mean, they're who knows how they kind of ran, you know, the the deal side, you know, it's maybe not always transparent. So.

Jacquie Dalton (13:34)

That's true. Yeah, gives the benefit of the doubt until we know more.

Jessie Naor (13:38)

Hopefully. Man, we're both Florida residents, so we can say this. I don't know why. I don't know why South Florida is just sometimes the land of con men and women, but we're good guys.

Jacquie Dalton (13:40)

It was in South Florida. I know.

We're taking it over. There's more of us down here and we're making change, positive change.

Jessie Naor (14:01)

Well, and I think too, just comes from, know, Florida's just such an active market. You know, it's just, it's so busy, you know, so a lot of the activity is all happening here. And sometimes that means the bad stuff

Jacquie Dalton (14:05)

Yeah.

love it. I think the infrastructure here and the airport, I think it's fantastic. I love seeing all the airplanes fly by all the time right after, know, right out of my balcony. And, you know, I'm really impressed with the aviation industry down here. I think it's fantastic. And great weather.

Jessie Naor (14:25)

It is good weather, business friendly. Yeah, except for the summer. just I do need a little summer vacay away from the heat

in our next story today, Air Share has announced the elimination of repositioning surcharges. Fractional customers will no longer have to pay for those charges. And this is after a number of changes over at Air Share.

They acquired Wheels Up's aircraft management arm last year. They've got about 150 aircraft at this point with over 600 employees. So they have grown significantly. But what are your thoughts

this? Don't customers still have to pay for repositioning charges no matter what, even if it's not a listed?

Jacquie Dalton (15:03)

You know, it's, you know, it's, the consumers become so great. There's like

where the don't pay for, unless the plane's not repositioning, you know, that's the only time you're not paying for reposition. This is just all

price structure. And it's a little bit challenging. I don't like this kind of messaging. I'm really rooting for air share. I like the fleet. They've got

you know, nice aircraft.

But some interesting things are definitely going on there. but when it comes to repositioning, I, it does not, I don't think it works that well for the industry to get the consumer to think that, cause that's what dynamic flying is the ability to reposition is what our strength is. Right. So, and it's just a matter of price

Right. And so then you're looking at pricing in the market and it's, this looks like this is without repositioning. And then there's something priced this way.

you've got to reposition and you got to pay for it. Who's paying for it? Someone's paying for it.

Jessie Naor (15:54)

the airplane is going to repo, someone's paying for it. It's probably, well, and I used to explain it this way because when I, you the charter company I used to run, we were very, very transparent about it. We said, you know, this is all the repositioning that's involved and this is why the cost is what it is. And our hourly rate was truly based on how many hours the plane actually flew and not the passenger leg, you know, but so many times customers will see our hourly rate and be like,

Jacquie Dalton (16:13)

Yeah.

Yeah.

Jessie Naor (16:18)

wow, that's so cheap, and I'm like, yes, that's the, we charge for everything, and the other companies are doubling or one and a halfing their price just to show that it's no repositioning, but it is, no matter what.

Jacquie Dalton (16:28)

Yeah. Well, that's, that's why the customer relationship is

important. You know, working with people who, you know, really do want to understand what it is that they're buying into and, know, don't necessarily want to get, you know, some people like that easy, lock them, right? Right. This ties into the fact that they're launching a jet card, which, this we've seen this before and, you know, we kind of know how it plays out a little bit.

Jessie Naor (16:50)

Yeah.

Jacquie Dalton (16:53)

yeah, it's you have to pay for

So I think it's just a matter of that being buried in the cost.

Jessie Naor (16:59)

Yeah, well, and I think too, it's interesting because Air Shares' model for the fractionals is very different than others. you pay for days essentially, it's unlimited flight hours within a pilot's duty day limit. That sounds like a really

math problem, but I'd love to see the numbers and how that actually works out for their profitability.

Jacquie Dalton (17:16)

Now I know me too. should get, mean, they listen, they've got, compass

you know, they, they've got a capital investment in mid July, two guys from Kansas, Kansas. I love that one of them said something about betting on the jockey. I like to bet on the jockey. Of course I look at that and say, don't bet on the jockey unless he's on a good horse or she's on a good horse, right? Always comes down to the horse. So

Jessie Naor (17:20)

Mm

Jacquie Dalton (17:40)

But it'll be interesting to see what they do with this. They're also expanding into different territories. So they've been up in the Northeast and now they're going to be on the West Coast. But I heard really positive things when they initially did the acquisition over from wheels up because they were set up to integrate pretty seamlessly, which is always a positive.

Jessie Naor (17:59)

Hmm.

Jacquie Dalton (18:02)

but I think we're seeing some signs here with these new programs, whether it's, having not run them before or not knowing what they're going to be up against or having a new formula that's going to work. So it's

to be interesting to see it, to see it play out.

Jessie Naor (18:16)

It does feel like Airshare has grown pretty organically. They didn't go from zero to 150 airplanes overnight. That was a pretty gradual, I mean, the wheels up deal last year, that was a pretty big deal for them, but at least they kind of had a solid background. They've been in the

Jacquie Dalton (18:25)

Mm -hmm.

Jessie Naor (18:32)

a while, they know what they're doing, and they didn't do a SPAC deal and go public when they weren't ready to. Wish them luck. Hopefully they do well.

Jacquie Dalton (18:33)

Yep.

Yeah. Wish him luck. Absolutely. Want everybody to win.

Jessie Naor (18:44)

And they have a lot of celebrities on their website, I noticed, like the Kansas City Chiefs coach and some other ones, which is a great segue to the next story. This is getting really interesting.

college athletes can now sell their name, image and likeness and make money off of that, we're starting to see a lot of college private jet marketing deals opening up. Jaxson Dart was the first one earlier this year. He signed with Nicholas Air

It's one -year deal, it includes the ability to extend into his NFL career, which I found interesting. I'm wondering how that deal works and how long they can hang on to him. They also signed with another quarterback from University of Texas. But it's kind of

Jacquie Dalton (19:22)

you

Jessie Naor (19:23)

to me to see college students on private jets. I mean, I get they're big money makers and earners, but it's an interesting combination I didn't expect to see.

Jacquie Dalton (19:34)

Yeah, I think the payment for college athletes brings its own

even bringing aviation into it brings its own issues. So it's going to be interesting to see how that all plays out. But as far as any kind of ambassador program or, know, first of all, if I met a college student who actually could afford to fly private and was flying private and you look great in that sense, it makes, you know, it makes perfect sense. But I don't think college students are really the right target market.

The other thing I've just helped since I've been in the industry for about 15 years and I think everybody within the industry knows how I feel about the marketing that's out there. I think this is

another one of those, it's a disconnect. I'd rather see training programs and scholarships and things like that versus allocating money towards marketing with a college student. I hope it works out for these companies and that they get a return on it, but I...

Jessie Naor (20:20)

Yeah.

Jacquie Dalton (20:30)

I'd be surprised. And I think that it's just funds could be better utilized.

Jessie Naor (20:32)

Yeah. Well, and some of these are huge

I mean, the one that happened earlier this August, they said it's a seven figure deal. This was Georgia Bulldogs quarterback Carson Beck

a deal with a company called Airstar Charter, which actually I have never heard of before, but Airstar, Airstar, sorry. Yeah.

Jacquie Dalton (20:51)

Airstar, Airstar, Airstar. Yeah. Well, you know, I think that everybody tries, you know, they're trying to have affiliations and get exposure. It's a very crowded

as you know, you know, it's a very crowded space and, you know, companies are looking for a way to compete against, you know, these bigger budget advertising marketing companies, especially, you know, these are smaller operators per se, all reputable.

I think we learned from Wheels Up that this doesn't

work, right? It's not gonna work with Tom Brady. It's not gonna work with a basketball player,

Jessie Naor (21:24)

Yeah.

Jessie Naor (21:25)

And with that, we'll be wrapping up the pod today because we like to keep things short and sweet here so you get your private aviation news fast and quick on your morning commute. So don't forget to subscribe to our weekly email digest and the show notes and click follow wherever you get your podcasts. Comments and suggestions on what we should cover next are always welcome. So please stay in touch and we'll see you next time on the VIP seat.