Do VLJs Have a Future?

By Robert Mark on November 16th, 2008

I spent some time on the radio the other day with my podcaster-buddy Addison Schonland of Innovation Analysis Group in San Diego trying to figure out the answer to that question in light of the recent shutdown at Eclipse.

Despite what people may think of Vern Raburn or Eclipse Aviation as a business model, no one can dispute the fact that Raburn carved out a segment in our industry that did not exist before.Eclipse

Would there be a Citation Mustang or a Phenom 100 if Eclipse had not pushed the button on the VLJ market first? Give a listen to the IAG podcast as Addison and I hash out the VLJ issue.

And if you’re an aviation aficionado, why not subscribe to the IAG podcasts. They’re absolutely worth it.

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5 Responses to “Do VLJs Have a Future?”

  1. Paul Cox Says:

    No, the VLJ doesn’t have much of a future.

    Here’s the deal. First of all, the ATA’s big push to clobber private/general/corporate aviation with monster user fees isn’t going to stop now that Obama’s been elected.

    They failed to jam it through under Bush and Blakey/Sturgell, but they’ll certainly keep trying; it’s a holy grail for them.

    While I’m personally a believer that *some* bit of re-adjustment of the amounts that the various aviation entities pay is probably in order, in general I’m against the restructuring that the ATA wants. They want every plane in the sky to pay the same fee, and that’s just not realistic.

    But more than the user fee issue is the greenhouse gas issue. Carbon emissions are bound to be taxed or controlled at some point in the future; there’s little way around that problem if we ever decide to get serious about climate change and trying to reduce humanity’s effects on the environment.

    (Of course, this presumes that climate change is a real deal. I’m still a tad skeptical but leaning more towards it being a real deal, and due at least partially to humans, than I was in the past.)

    While carbon emissions alone from aircraft aren’t that much, when you lump in the other emissions from modern jets- and do it at the altitudes that they fly at today- aviation is going to be under serious attack.

    So what? Well, it means that on a per-passenger basis, private bizjets- including VLJs- are going to get clobbered. The easiest way to charge people for GHG (greenhouse gas) emissions is to charge heavy taxes on fuel.

    Big deal, people might say. Fuel zipped up in 2008 in a BIG way, and the private sector didn’t have any issues with it.

    Here’s the thing, though. When you start to compare the per-seat-mile costs of a big fat 787 with any bizjet, or particularly with a VLJ, and you raise the price of the fuel component of that per-seat-mile cost, sooner or later the big airplane starts to see some REAL cost advantages over the little one.

    Economy of scale, in other words, is what will limit VLJs’ future. When someone can haul 280 people from point A to point B in a single airplane for a cost that’s lower than what they can haul those 280 people to points B, C, D, E, F, G, and H in 15 or 25 individual jets, the person operating the single jet is going to make more money.

    Finally, I believe that part of environmental policy and climate change and transportation infrastructure and energy independence and so forth is going to be a shift in government subsidies.

    It’s going to be over several decades, but we’ll eventually be putting a lot more money into fast or superfast rail services- probably electrically driven trains, like they have in Europe and Japan.

    And we’re going to put less money into airports and aviation infrastructure.

    This pays all kinds of benefits. The least efficient commercial airline flights are those short hauls, like between the major population centers on the eastern cost of the USA.

    When you tack on the length of time it takes to get to the airport, fighting through the traffic on the freeway and such; wading through check-in and security; then waiting for your (probably delayed) flight, flying a shorter distance- say 250 to 400ish miles or so- becomes a big pain in the butt.

    Now imagine that you can go to a train stop and walk on to a superfast rail train. One leaves every hour, or every 30 minutes on busy routes. There’s no security, buying a ticket and getting on is extremely quick and easy, and even the cheapest train seat is bigger and more comfortable than the typical coach seat.

    You can get up and walk around, get something to eat, there’s wi-fi networking and electric plugs…

    The point is that trains, for shorter distances, are easier and superior in many ways than flying. The thing that flying has is price and speed; but when the prices zoom up because of the GHG issue and fuel costs, and if we shift federal subsidies from aviation to rail, then trains are going to take over.

    And the segment of the market that the trains are really going to kick butt in are the same segments of the market that VLJs are aimed at.

    All of this, to me, adds up to VLJs not having a very bright future in the longer term.

    But hey, I could be wrong. ;)

  2. Bo Henriksson Says:

    Great podcast Rob! Why not make it a regular feature and have it available through iTunes?!

  3. JJ Cassa Says:

    “Would there be a Citation Mustang or a Phenom 100 if Eclipse had not pushed the button on the VLJ market first?”

  4. Hookedonflight.Com » Blog Archive » My thoughts on VLJ’s Says:

    […] Robert Mark from the Jetwine blog posed the following provoking question today in his post “Do VLJ’s Have A Future”: […]

  5. Stephen Says:

    The VLJ concept actually belongs to Burt Rutan, he flew the initial aircraft first. The VLJ is what many consider to be the next best thing in GA. The Day Jet scenario ran into big trouble and the Eclipse has to be hand flown on approaches until they upgrade their EFIS technology. User fees to crush bizjets is the work of our airline buddy Frank Lorenzo..

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