Your business aviation hot takes, served fresh.

July 1st, 2026 | Season 3 Episode 26 Companion

Good morning and welcome back to the VIP Seat. This week we are covering Wheels Up going all in on AI, a Canadian fractional selling to private equity, an engine support lawsuit against Pratt & Whitney Canada, a drone scare on final at JFK, Flexjet locking up exclusive Gulfstream G500 rights, and a special guest breaking down the carbon scheme that has airlines sweating. Sit back, buckle up, and let's take off.

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The Scoop: Surf Air Mobility (NYSE: SRFM) named Wheels Up (NYSE: UP) as the launch customer for Enterprise BrokerOS, its SurfOS charter broker product built on Palantir Technologies' Foundry and Artificial Intelligence Platform, according to a June 25 announcement. The initial agreement runs a two-year term with an option for a third, and Surf Air said it expects to receive up to $12 million in subscription fees. The software is designed to consolidate supply across Wheels Up's owned fleet and its third-party operator network, streamline sourcing, quoting, booking and customer management, and surface real-time business intelligence. Surf Air reported $10.1 million in on-demand private charter revenue in its most recent quarter, a 77% year-over-year increase, per the company. Wheels Up brings more than $1 billion in total gross charter bookings to the deployment, and the rollout is meant to replace multiple legacy software platforms. Wheels Up CEO George Mattson framed the partnership as technology becoming a competitive advantage rather than a back-office function, according to the announcement.

Our Take: Two publicly traded companies tying the knot is the headline, but the structural story is what BrokerOS is actually for. Wheels Up has spent the last couple of years transforming its fleet, moving out of King Airs and Citation Xs and XLSs and into a unified Phenom 300 and Challenger 300 lineup. That unified fleet still has to serve a wide, legacy customer base, and a sourcing engine that can reach off-fleet supply efficiently is how you keep those trips covered. We do not read this as the end of the human sourcing desk. This industry is relationship driven, and somebody still has to pick up the phone. What AI unlocks is the optimization layer on top, and when you are running tens of thousands of flights a year, small improvements in conversion and throughput add up fast.

Here is the question we keep coming back to. It is a deal worth up to $12 million, and the lines between so-called competitors keep blurring as everyone races for the same software moat. Surf Air is not the only one chasing this, Fly Exclusive has floated a similar operator platform, and private equity is effectively telling every one of these companies to build an AI fortress around the business. So who else pays $12 million for this, and is there room for three or four winners or is this a winner-take-all sprint? We do not have the answer yet, but the race for the software layer is officially full throttle.

Read More: Private Jet Card Comparisons

The Scoop: Reporting cited by The Sun and the Financial Times warns that airline costs tied to international carbon rules could push fares higher, with the FT reporting the industry could face up to $127 billion in additional costs through 2035 under CORSIA, the global aviation emissions scheme, if eligible carbon credit supply stays tight. MSCI Carbon Markets estimates credit prices could rise nearly eightfold to around $100 per tonne by 2035, according to that reporting. Under CORSIA, airlines in participating countries must offset international emissions above 85% of their 2019 baseline, and roughly 130 countries currently participate, with the mandatory phase set to widen coverage. The reported supply problem is structural: credits must come from approved projects carrying host-country Letters of Authorization, and only a handful of countries had issued those authorizations as of early 2026. Pressure could intensify further if the European Union proceeds with a proposed additional carbon levy on flights departing the bloc, per the reporting.

Our Take: We brought in a subject matter expert for this one. On the show we sat down with Kennedy Ricci of 4Air to translate CORSIA into plain English, and the short version is this.

It is an international framework run through ICAO that caps international aviation emissions against a baseline of 85% of 2019, and you offset or use sustainable fuel for anything above that line. Reporting happens at the country level, the body calculates what is owed, and the first real compliance surrender lands in early 2028. The bottleneck right now is not a shortage of projects, it is paperwork: only a small number of countries have issued the Letters of Authorization needed to make credits CORSIA-eligible, and a single large project could close a meaningful slice of that gap.

For our world, the thresholds matter. CORSIA generally bites when you are flying a significant amount internationally, on the order of about a million gallons or 10,000 tonnes of CO2 a year, so the exposure concentrates among large fractionals, sizable charter operators, and some management companies, with domestic flying excluded. Europe is a different animal, with a lower ETS threshold and penalties set by the administering country, which means a European operator can face stiffer consequences than a North American one for the same miss.

As Kennedy put it, 4Air is now tracking well over a hundred policies that touch business aviation, which is exactly why a single global standard like CORSIA beats a patchwork of country-by-country rules. The thing to watch is the EU's review and whether Brussels pushes to extend its own scheme to international flights. If that happens, the compliance math changes for everyone.

Read More: The Sun

The Scoop: Onex Partners, through its Onex Partners Opportunities Fund, along with TriWest Capital Partners and other co-investors, agreed to acquire AirSprint Inc., Canada's largest fractional jet operator, per a June 25 announcement. Founder and Chairman Judson Macor and President and CEO James Elian, along with certain current shareholders, will remain investors after closing, with Macor becoming chairman emeritus and Elian staying in his executive role and on the board. Calgary-based AirSprint operates the largest fractional fleet in Canada, reported at more than 40 aircraft, with offices in Toronto and Montreal and more than 600 fractional owners. Its 38,000 flight hours in 2024 would have ranked it eighth on Private Jet Card Comparisons' U.S. list of fractional and charter operators. Terms were not disclosed, and the transaction is expected to close in the third quarter of 2026. The deal marks AirSprint's first institutional investment in its 26-year history, and Onex separately owns a 75% stake in WestJet, according to reporting.

Our Take: For long time listeners and readers, you know the private equity playbook by now. Buy the platform company, then bolt on add-ons and feed them into the central operator. The wrinkle here is geography. AirSprint is the biggest fractional in Canada by a wide margin, so the obvious bolt-on targets are thin. That leaves a few paths: vertically integrate, or cross the border into the United States. We would not be surprised to see more deals follow, because that is how this story usually goes.

The deeper reason private equity keeps gravitating to fractional is that the model just makes sense to them. There is effectively no financing cost on the metal, because the owners are buying the aircraft and the operator earns its slice on the flying. Scale pulls down OEM costs, and it reads to investors a lot like a timeshare, which is far easier to underwrite than the capital-hungry, episodic economics of charter. Private equity does not get out of bed unless you can show them a path to a much bigger company, so the question to watch is simple: where does the next leg of growth come from in a market the size of Canada?

Read More: Private Jet Card Comparisons

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The Scoop: ATI Jet, which now operates as Jetvia, has sued Pratt & Whitney Canada over engine support, filing the complaint on April 7 in the U.S. District Court for the Western District of Texas, according to Private Jet Card Comparisons. The central allegation concerns the size of the manufacturer's rental engine pool. ATI alleges Pratt maintained roughly 12 rental engines to support an installed worldwide fleet of more than 800 Learjet 60 engines, which the operator argues represents barely 1.5% of the fleet, while citing internal analyses that allegedly concluded industry practice calls for 4% to 8% availability. The complaint alleges Pratt prioritized engine availability for new aircraft deliveries and new customers over its existing ESP contract obligations, characterizing the conduct as intentional. ATI Jet says it operates 24 Learjet 60s, which it describes as the largest Learjet 60 operation in the world, and the suit seeks rescission of a January 2025 settlement, compensatory and exemplary damages, attorneys' fees, and termination of more than a dozen ESP agreements. The complaint reportedly does not place a single total dollar figure on all claimed damages. The filing follows Flexjet's litigation against Honeywell, which was settled in December with Flexjet receiving over $1 billion in cash and services, and the law firm that represented Flexjet, Quinn Emanuel, has reportedly joined ATI Jet's legal team. These are allegations that have not been proven in court, and Pratt & Whitney Canada has not been found liable.

Our Take: Anyone who has had an airplane stuck on the ground waiting on an engine feels this one in their bones. A revenue aircraft out of service is brutal, on the balance sheet and on the reputation, and the heart of the dispute is whether the rental engine pool was deep enough to keep operators flying. This is active litigation and these are allegations, but it’s a topic that has been on discussed on stages at every major conference over the last few years.

We keep coming back to our conversation with Kenn Ricci on the Honeywell case. On the show he told us this would not be the last time we heard about engine program disputes, and he laid out a playbook. This looks like operators following that lead. Litigation against an OEM takes a lot of money and a lot of time, and there is no guarantee of recovery, but it may be one of the few real tools a midsize operator has when an engine program does not deliver.

One note for the record on jurisdiction: this case sits in Texas, so the Flexjet result out of New York is not a precedent a Texas court is bound by, and the two venues can treat these contracts very differently. Our read is that the story of engine program friction is just beginning, not ending.

Read More: Private Jet Card Comparisons

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The Scoop: A JetBlue pilot reported colliding with a drone at roughly 3,000 feet on final approach to New York's JFK around 7:15 a.m. on Monday, June 29, according to the FAA and air traffic control audio cited by CNN. The Airbus A321 was arriving from Las Vegas and landed safely minutes later. A source familiar with the preliminary investigative findings told CNN that investigators found no damage to the aircraft and no evidence of drone activity at the location, altitude and time the crew reported the strike, and JetBlue said a post-flight inspection found no damage or evidence of a collision. The aircraft was returned to service. Separately, a helicopter pilot flying from JFK to Manhattan later that day reported a close call with what was described as a model airplane, and the FAA told CNN the two incidents are not related. The FAA reportedly receives roughly 100 drone sighting reports a month, and a United pilot reported nearly colliding with a drone near Newark the prior week, per CNN. The investigation remains ongoing and officials have not said what, if anything, the aircraft encountered.

Our Take: Everyone in this business knows to watch for birds. Now we apparently have to watch for drones too. The frustrating part is that even when a strike cannot be confirmed, the reports keep coming.

We will put the tinfoil hat on for one beat. If the United States already limits consumer drone altitudes and ceilings, the obvious question is what a drone was doing reported at 3,000 feet near a major airport, and whether better detection and identification requirements would change the math.

While we are talking about new things in the sky: slack lining, where ropes get rigged across mountain terrain at altitude, sometimes with no notice to anyone. Wire cutters aren’t effective on these lines, and has already resulted in a fatal crash this year.

Read More: CNN

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The Scoop: Flexjet has formally added the Gulfstream G500 to its fleet and says it has an exclusive agreement with Gulfstream to be the only fractional provider to receive new G500 and G700 deliveries, per the company's June 25 announcement. The G500 will gradually replace the aging G450 as Flexjet's large-cabin type, joining a Gulfstream lineup that now spans the G700, G650, G500 and G450. Flexjet says it operates the largest owned, operated and maintained Gulfstream fleet in the world, with reporting putting its Gulfstream count at 68 large and ultra-long-range aircraft within a total fleet of more than 340 jets. The G500 offers a range of about 5,200 nautical miles, a top cruise of Mach 0.90, and is roughly 33% more fuel efficient than the G450, capable of flying nearly 1,000 nautical miles farther on the same fuel, according to the company. The G500 will operate under Flexjet's Red Label program, which assigns crews to a single tail and features the LXi Cabin Collection interiors.

Our Take: This is a logical fleet move dressed up as a milestone. The G500 stepping in for the aging G450 mirrors the way the G700 has become the new flagship in place of the G650ER, and yes, that is functionally a replacement at the top of the lineup, because you cannot order a brand new G650 today.

The more interesting angle for the industry is pricing power. When you are effectively the only fractional offering new Gulfstream metal at scale, you can command a premium, and a high-touch program like Red Label gives Flexjet room to price discriminate toward the end user even if it is buying at or near retail. We will leave the question of how much Gulfstream discounts on a bulk order to the people in the room, but exclusivity is its own moat, and this one just got wider.

Read More: ch-aviation

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The Influencer Playbook

We finally said the thing a lot of you have been thinking about the wave of voyeuristic "look at this wealth" private jet content. When you let the algorithm dictate what you post, you start making decisions that are not net good for the industry long term. It might go viral, but over time it affects the public’s views on the industry it claims to represent. Building a luxury jet business is about safety and quality, and none of that comes from a “my billionaire daughter flew a G650 for cake” video. It comes from serious relationships and consistent performance. Private jets should be marketed as indispensable to the people that need them, not the toys of the wealthy.

No Experience Required

Our blood pressure spiked at an ad making the rounds on social this week pitching a path into selling private jets with, and we quote loosely, no experience required. Come on. You can absolutely build a great living in this business, but it takes real expertise, real risk, and years of relational capital. We know people who have been sued over a spec sheet. "No experience required" might be the most dangerous line in business aviation, and it makes life harder for the operators who actually do the work. Holding short on that one.

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Jessie’s Links:
Private Aviation Safety Alliance
FlyVizor
LinkedIn

Preston’s Links:
Prestige Aircraft Finance
Private Jet Insider (Newsletter)
LinkedIn
X (Formerly Known as Twitter)
FastJets

Disclaimer: The VIP Seat Weekly is for informational and entertainment purposes only. Coverage of publicly traded companies reflects the personal opinions of the hosts and does not constitute investment, financial, tax, or legal advice, nor a recommendation to buy, sell, or hold any security. The hosts are not registered investment advisors and may hold positions in companies discussed. All investments carry risk. Readers should conduct their own research and consult a qualified financial professional before making any investment decision.