US charter operator Linear Air is seeking up to $2 million of investment to fund a marketing campaign, designed to raise awareness of its online booking platform among the country’s lucrative piston-engined aircraft operator community.
The goal of the Concord, Massachusetts-based company is to double this sector’s annual revenues from $500 million to $1 billion and eventually roll out the booking platform globally.
This strategy marks a change of direction for 10-year old Linear Air, which is one of the early adopters of the Eclipse 500 very light jet. “This business has been relatively successful,” says William Herp, founder and chief executive of Linear Air, which operates a handful of the VLJs under management. “But it is not a growth business any more,” he explains.
“We had high hopes for Eclipse 500 in the beginning,” Herp adds, in reference to the company’s original plan to establish a pan-USA point-to-point air taxi service with a fleet of the six-seat types. “This model was predicated on Eclipse Aviation producing high volumes of aircraft and keeping the acquisition costs low. The company collapsed [when the downturn hit] and the new owner [Eclipse Aerospace] only produces small numbers of aircraft a year.”
Herp says travellers are now turning to small, propeller-driven aircraft such as the Cirrus SR22 for low-cost flexible travel. “The SR22 is the fastest-growing fleet in the air taxi market with over 100 operators to date,” he says. The four-seat piston single is significantly cheaper to operate than a light business jet, or even a turboprop, he argues, “and their appeal is widespread” among travellers who are looking to fly to secondary and tertiary cities that are so well served by airlines.
To confirm Herp’s confidence in this niche sector, Linear Air has set a target of 1,000 trips to be booked through its platform this year – nearly three times the tally for 2014.
To help reach this goal Linear Air is seeking to raise between $1 million and $2 million in funding from individuals and angel investors. This will finance a marketing campaign to raise awareness of the air taxi market and Linear Air’s online booking system. “We will close the funding round on 2 April and start campaigning in earnest soon after,” says Herp.
Linear Air is focusing on companies along the northeastern corridor initially – six of which have already been added. “Our plan is to expand our operator profile to include the 1000 suppliers of [Part 23] piston-engined aircraft charter in the USA,” says Herp.
The US piston-engined air taxi market is worth around $500 million in revenue annually, Herp continues. “By raising awareness of these operators and helping them, through our booking platform, to absorb a fraction of their idle aircraft capacity, we can grow these billings to $1 billion a year,” he adds.
Source: Flight International
