December 5, 2008

The Gang of Three Ruin another industry: Private jets

Interesting read from Al Tompkins at the Poynter Institute in Tampa.

Dec. 4, 2008

Auto Execs May Be Hurting Private Jet Business
I remember the days when I got to ride around in the Meredith Corporation jet a few times. A team was out looking at buying TV stations, and we hopped from town to town. It was great fun, and the executives could hit a few towns and still go home and sleep in their own beds.

Lately, though, the use of corporate jets has been highly criticized. The Big Three executives have become poster children for excess, riding in private jets to their first hearings. Watching General Motor's 6-foot-4-inch Rick Wagoner get out of the hybrid car was a picture of humility.

So what happens now to the private jet business? Will governors and other politicians have to ditch their flight plans for the time being until flying seems less excessive to taxpayers?

Time magazine makes the argument that maybe we have all of this wrong. Maybe people who run huge businesses and governments should not be sitting around at airplane gates hoping planes will leave and arrive on time. Consider this:

It was pointed out that the three could have flown commercial that morning for something like $212 each. But let's do the math. Three CEOs being paid millions a year each are going to Washington on a business trip to try to save $300 billion worth of sales and 3 million jobs -- and they are supposed to risk all of that on Northwest or US Air, a.k.a. Northworst and Useless Air, formerly Allegheny a.k.a. Agony Air? I see the connection: you fly to D.C. on a previously bankrupt airline as you contemplate the bankruptcy of your own company. The experience should be enough to scare you into devising a scheme to save your own company from such a fate. But wouldn't this be a case of America's worst-run manufacturing companies relying on America's worst-run service companies? There'd be a 50% to 75% chance of the CEOs showing up on time. What are you supposed to do, call Congress and tell them you're on a gate hold?

Even voices in the corporate aviation business worry that the public is getting the wrong message about charter business flights.

A commentary piece in the Hartford Courant offers some additional ideas about why flying commercial is not a great option for high-level execs:

High-level executives -- especially those heading up corporations in the news -- are the targets of significant and very real, threats, which are leveled at them every day. Flying commercial is not an option, even with a bodyguard. The exposure is simply too great.

Also, every major corporation I know has policies prohibiting certain senior executives from flying together, guarding against catastrophic loss to the corporation in the event of an accident. Asking three top executives from the auto industry, even from different companies, to fly together would violate the very appropriate caution imposed by this policy. Further, corporate aviation is not a royal barge, it is a time machine. 

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