Flying with a Car Service

posted: 09 May 2008 5:37 p.m. ET

: SATSair flies to many airports in the southeast and mid-Atlantic United States, many of them small and with minimal facilities. But it can get its customers much nearer their destinations than can airlines. Credit: SATSair
: Steve Hanvey, president and CEO of SATSair, says one of two big surprises since SATSair began is how much the Cirrus SR22's whole-plane parachute reassures 'white-knuckle' fliers and makes them confident of flying in small aircraft. Credit: SATSair
: The Cirrus SR22s that SATSair flies might have only four seats and a single engine, but they're fast, comfortably furnished with leather seats, and ride turbulence very smoothly, according to SATSair CEO Steve Hanvey. Credit: SATSair
: Among the 600-plus airports to which SATSair has flown, the company serves 47 of the 60 public-use airports in its home state of South Carolina and 108 in Florida. In November 2007 the company signed a purchasing agreement with the state of Florida that allows state employees to use SATSair for business travel. Credit: SATSair

Imagine a New York City car service in the air. You call the service, a four-seat sedan comes as soon as one is available, it picks you up near your office and drops you off close to your destination, an hour or so after you get into the vehicle.

The total door-to-door time for your journey is about three hours. In that time you've traveled some 250 miles. At no point have you had to use a congested major airport or drive on an Interstate highway. In fact, in many cases your destination isn't within 20 miles of an Interstate and can't easily be reached on major roads.

Sometimes the journey time is less, sometimes a bit more, depending on how far you’re going. However far it is, you'll only be charged for the time you're in the aircraft — there are no extra charges associated with having it come to pick you up. Nor are you sharing it with strangers going to other places.

You’re flying on a small, single-engine, propeller plane, a thought you might find a little daunting. But the plane — a Cirrus SR22 — is fast (180 mph), flown by a professional pilot, and it provides a smooth and comfortable ride even in turbulence. You get a wonderful view outside, you can see and hear what the pilot is doing at all times, and you know that if anything goes badly wrong in flight (like the engine stopping) the pilot can pop a parachute that will let the entire plane coast safely to the ground.

The SATSair 'aerocab' service

That's the idea behind the service South Carolina's SATSair has been providing for the last three years. For businesses who need to get people to out-of-the-way places but don’t want them to have to drive for six hours or more, or individuals who want to get their families or friends to a vacation several hundred miles away on time and would otherwise fly them on an airline, the service can make sense.

"Today we're an interstate 'aerocab' air taxi operation," said Steve Hanvey, a former test pilot and experienced aviation-industry executive who is the president and CEO of SATSair. (The "SATS" in SATSair stands for Smart Air Travel Solutions.) "You call us and we will come as soon as we can. We have 26 aircraft right now — we have enough so we typically can get to you very quickly."

In many cases SATSair can have a plane at the nearest small airport to a customer within two hours of the customer's call, said Hanvey. As its network grows, that isn’t easy to achieve, but SATSair has volume orders for more Cirrus SR22s. Although its core market is the Atlantic states from Virginia to Florida, SATSair has flown to more than 600 airports in 27 states.

"We tell people it works just like a cab in New York City and they say, 'Yeah, yeah,'" added Phil Quist, SATSair's vice president. But once they have flown with SATSair for the first time, customers tell SATSair it is just like a car service to use, said Quist.

SATSair and DayJet models different

DayJet, the pioneering Florida very light jet (VLJ) air taxi operator, garnered lots of media attention with its on-demand service linking a growing number of "Dayports" in Florida, Alabama and Georgia using three-passenger Eclipse 500s. But DayJet newly has laid off 100 people and cut back its expansion plans because the tight credit market made it unable to obtain a planned $40 million in new investment.

So far, there is no evidence that SATSair's business model will be similarly affected, said Hanvey and Quist. SATSair provides a whole aircraft and simple pricing, rather than one or more seats on a jet and variable pricing depending on the customer's flexibility in departure and arrival time, as DayJet does.

"It's why we chose not to bet on a VLJ — the numbers wouldn’t work on a whole-airplane business model," said Hanvey.

That said, for longer-distance air taxi operations, Hanvey does think "the right VLJ can service the industry." When experience gained in having a VLJ model in service for a while allows it to achieve high service reliability levels, "Its ability to service the high-frequency market will improve and cost will improve," he said.

"I think we've added another tier in air transport capability," added Hanvey. "I think that, just like the major airlines, which have business and first-class" as well as economy class, "VLJs are in those categories relative to us. They will be 20 to 25 percent, and the other 80 percent will be people like us. I see us being complementary, not competition."

SATSair's service is by no means dirt-cheap, but to get to the kinds of places most of the company's customers want to go, flying three or four people on an airline probably would be even more expensive — and it certainly would be more time-consuming. Driving would be cheaper, but would take much longer and would be much more tiring.

Growth continues

"With the economic conditions we all saw coming at the end of last year," SATSair certainly worried about a downturn, said Quist. But after the number of flights SATSair operated grew more than 60 percent in 2007 as customer accounts proliferated and accounts used the service more often (some 20 times a month), the first quarter of 2008 saw growth continue.

It's still going. "We have seen some of our record days, and our record week, in the last month," said Quist.

The company's "value proposition" includes SATSair offering to make car-rental and other reservations for customers, and informing them of the nearest, most convenient airfields to their destinations.

"We can get into 2,500-feet (runways) — VLJs can't do that," said Hanvey. Often, a SATSair customer has no idea that an airfield exists close to his or her destination, and is happy to be able to use it.

The proposition also involves a high level of customer contact that includes a call the night before a customer is due to fly and post-flight calls to obtain feedback and resolve any issues.

"We will typically follow up with customers before they get a chance to call us," said Quist.

SATSair's pilots play a big part in the company's "personal touch" customer-service approach by picking up passengers and their bags at the departure airport, answering passengers' questions throughout the flight, and making sure requested arrangements are in place at their destination.

Two big surprises

Hanvey has been pleasantly surprised, twice, as SATSair has developed.

Customer reaction to "the (whole-aircraft) parachute was the first big surprise. It takes the airplane flying and doesn’t let it crash," said Hanvey. "White-knuckle flyers — and we get a tremendous number of them — take a lot of comfort from it."

The second surprise was that "You can multiply the number of airplane uses from disparate locations by having a large number of lower-cost airplanes," he said.

Rather than flying a larger business turboprop or jet around to several airports to pick up a number of people to fly to an event, a time-consuming and expensive process, "We in fact can fly one or two people less expensively (in a number of aircraft) and get them there all at the same time," said Hanvey. "How we support the Masters (at Augusta National Golf Club, Ga.) is an example."

The proof of the pudding can only lie in the variety of ways people use SATSair's aerocab service. Flights bought by SATSair customers have ranged from 15-to-20-minute hops to pick up blind dates (twice by the same person in a week) to a customer flying himself from Norfolk, Va. and friends from other locations in multiple SATSair aircraft to Key West, Fla. every year for fishing trips.