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Net Jets 2005 Report

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fracslave

Member
Joined
Nov 23, 2003
Posts
13
This sucks...

Operating results at NetJets were a different story. I said last year that this business would earn money in 2005 – and I was dead wrong.
Our European operation, it should be noted, showed both excellent growth and a reduced loss. Customer contracts there increased by 37%. We are the only fractional-ownership operation of any size in Europe, and our now-pervasive presence there is a key factor in making NetJets the worldwide leader in this industry. Despite a large increase in customers, however, our U.S. operation dipped far into the red. Its efficiency fell, and costs soared. We believe that our three largest competitors suffered similar problems, but each is owned by aircraft manufacturers that may think differently than we do about
the necessity of making adequate profits. The combined value of the fleets managed by these three competitors, in any case, continues to be less valuable than the fleet that we operate. Rich Santulli, one of the most dynamic managers I’ve ever met, will solve our revenue/expense problem. He won’t do it, however, in a manner that impairs the quality of the NetJets experience. Both he and I are committed to a level of service, security and safety that can’t be matched by others.







http://www.berkshirehathaway.com/letters/2005ltr.pdf
 
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Yep. We're great at safety and great at service, but for some reason making money isn't in anyone's vocabulary.
 
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Here is the reason "SELL-OFFS" why do you thin kwe got a new contract. The pledge cost them. Then suddenly the light went off.

Long live BB and the great RTS.

There is a new proceedure in place at Netjets. Scheduling is forcing us to ferry the planes to our HBA regardless of the cost so they can save the $ they would have to pay us for not getting us home. Even so this is not nearly as expensive as those "SELL-OFFS" are.
 
Remember sitting around fbo's all day while charter guys did our trips?

That was a nice relaxing time.
 
Customer contracts there increased by 37%.

I wonder if this includes the card holders or is this the real deal honest to goodness, share owner?
 
Losses at NetJets

Man, $80 million dollar loss vs. a $10 million gain in 04?

If you look further is also seems to say that there was a pre-tax charge if $85 million for subcontracted 135 aircraft.

Ouch.

Any idea how NetJets is gonna prevent aircraft shortage this year? Perhaps one way of doing this would be to put some heavier restrictions on the Marquis fliers. Just my humble opinion.

Holden1
 

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