I was not alive during the Great Depression, when people lined up down the blocks of this great country trying to be lucky enough to gain a bowl of soup. But with each passing day, our financial news gets worse, our economy gets weaker. It's as if the terrorists are screwing us all into the ground one gallon at a time.
I am thankful tonight for not having a big growing company like Dayjet, a wonderful business model for an air taxi operation. In a perfect economy, I might be jealous of such a company, but with a crumbling investment capital market, insane fuel prices, and tighter budgets in all classes of air travelers, it is sad but not really surprising to read this very well-written article on Aero-News Network:
"Citing difficult times within US investment markets -- and resulting issues with securing new investment capital -- DayJet announced Tuesday the Florida-based air taxi service plans to drastically scale back operations. ANN has confirmed with DayJet executives 100 people were laid off, reducing the company's workforce to 160 employees."While there are many, many upstart air taxi operators out there today, none have been as visible as Dayjet. Their devotion to the Eclipse 500 is well-known, and they received some of the first -500's off Vern Raburn's assembly line.
ANN reports that DayJet operates 28 Eclipse 500 VLJs now, and has (had?) big plans for the future:
"The air taxi provider is by far that planemaker's largest customer, with reportedly some 1,400 planes on firm order or option. Despite the ominous tone of Tuesday's announcement, however, Eclipse CEO Vern Raburn told ANN he is not overly concerned about DayJet's future. "The last company I'm losing any sleep over is DayJet," Raburn said."Ouch, Vern, that one hurt a little.
The current volatile business climate in the U.S. is only slowing down Dayjet's growth, so says their CEO, Ed Iacobucci in this quote from ANN:
"I won't dwell on this point, but suffice it to say that given the current state of the US capital markets, the timing of our planned financing could not have been worse. Without the growth capital required to open new markets, the company must scale back to a size that is consistent with the demand of our existing customers and service region," Iacobucci said. "DayJet’s business model is based on operating at a critical mass, requiring investment ahead of growth. We hired and trained a number of employees in anticipation of future growth and always planned for additional capital investment at this stage."I really hope that this is just a blip, a hiccup, a setback, a stumble...for Dayjet. I have studied their business model, and it is as sound as any out there today. Iacobucci and his team have done their homework, and if any group can make an air taxi operation profitable for the long haul, it is Dayjet.
It is especially important to see Dayjet succeed because of the bad karma it will bring to the sector if they fail. Today, there are many, many investors, competitors and future air taxi customers out there watching this Dayjet situation from the sidelines. And in a country that is void of any sort of financial leadership, should this fine company go down for the count, more could follow. It will not necessarily be their fault either, because just a few years ago, who could have thought that BushCo and his buddies would celebrate crude oil spiking to $123 a barrel while they just sit back and laugh at the millions of Americans who are spiraling in like a shot-up P-51.
I wish Dayjet the best, and hope their financial Knight in Shining Armor comes riding into their life soon. I want them to be wildly successful so the air taxi industry can continue to blast off like we all know if can. Air taxi, and low-fare, Cirrus SR-22 based private air charter networks like this one really are the future of commercial air travel, and they are all at a critical point in the birthing process of this emerging sector.