Flexjet offer is litmus test for Learjet 85 as fractional

Washington DC
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Bombardier's in-house fractional ownership provider, Flexjet, is in a race to sell out the shares in four Learjet 85 twinjets, before it puts the new type into service.

"We need volume," Flexjet sales and marketing vice-president Bruce Peddle said. "We have to start with four aircraft fully committed and flying in the system". Flexjet placed its order in 2008, and launched the fractional programme in August.

To help reach its target, the Dallas-based company is offering a 5% discount on shares in the first four aircraft, down to $1.08 million from $1.14 million.

Each share represents 1/16 of an aircraft - or 50 flight hours per year. The sale so far has netted five customers, though Peddle said he is confident he will sell out one aircraft by the end of the year.

The launch customer for the all-composite eight-passenger twinjet in the US, Flexjet has firm orders for seven Learjet 85s in total. The first is scheduled to arrive in late 2013, followed by four aircraft in 2014 and two in 2015.

Having the ample resources of an established fractional - 84 aircraft and approximately 1,000 customers - will be a bonus for bringing in a new technology aircraft.

"It takes time to get an aircraft into service and get up to a standard you accept," Peddle added. "We have other aircraft that can support us in that network. We can always back up that mission with a Challenger 300 or Learjet 60."

Flexjet's fleet, as of early September, was comprised of 19 Learjet 40s, 12 Learjet 45s, 10 Learjet 60s, 31 Challenger 300s and 12 Challenger 604/605 models, with three Challenger 300s and one Challenger 605 on tap for delivery in 2012.

Peddle said Flexjet was given a private update on the Learjet 85 program recently, with Canada-based Bombardier indicating that the type's first flight is on schedule for mid-2012 - as is its first delivery, in the fourth quarter of 2013. Bombardier said the first delivery will likely go to Flexjet.

"Follow-on orders will be contingent on how we're doing with [the initial aircraft] moving into the fractional space," Peddle added. "Seven aircraft is kind of a nice order, but to get economic volume and efficiencies, we would like to see many more."