An Irish-based, low-cost executive jet airline is all set to launch this September, reports CIARAN HANCOCK

IN AVIATION parlance, JetBird chief executive Stefan Vilner has “pushed back” and is about to begin his taxi to the runway.

In September, after more than three and a half years of planning and a couple of deferred launches, the Irish-based, low-cost executive jet airline will be cleared for take-off from its first base in Cologne, a city situated right in the middle of Germany’s industrial heartland.

JetBird is taking off into a strong headwind, namely the worst global economic recession since the 1930s. Vilner, a Dane, is undaunted.

“Launching into the depths of a financial crisis is a good thing because everyone is focused on costs,” he explains, from his spanking new glass office in the East Point business park near Dublin Port.

Executive jets conjure up an image of deep pile carpets, reclining leather seats and cocktails served by a steward wearing white gloves – just the type of expense that pampered senior executives can no longer justify to shareholders in these straitened times.

“Time will tell,” Vilners says. “Do they [companies] need a huge jet for 16 people? No, probably not. What we are offering is an intelligent alternative to that.”

That’s to say nothing of the environmental lobby, who believe that if executives must travel by air to meetings then they should do so in the company of the great unwashed, on a big jet plane, rather than in a small, fuel-guzzling swanky jet. JetBird’s aircraft will carry just four people.

Vilner begs to differ. His fleet of brand-new Phenom 100 aircraft will be among the most fuel efficient in the air, he argues, and the beauty of JetBird’s service is that executives will be flown closer to their final destination, mitigating the need for further travel by road or rail.

“Most of this is about people getting to places that they can’t get to on a scheduled flight,” he says.

Vilner also argues that as most of its flights will only be of one-hour duration, it will involve the aircraft ascending to about 25,000ft and then descending into the airport. So while the Phenom 100 is about 100km an hour slower than a Boeing 737, it will spend very little time cruising. Travelling into quieter airports will also reduce the need for the plance to queue for landing, a frequent occurance at busy airports.

“Because we are using secondary airports, we won’t have the problem of holding because we can fly straight into the runway, which is another important environmental consideration,” Vilner says.

Vilner likes to compare the JetBird business model to that of Ryanair, but with the frills. They will cost from about €3,200 an hour, which is not cheap when compared with prices charged by scheduled airlines, even ones offering first and business class services.

But it is about 50 per cent cheaper that many of its competitors, including NetJets, the biggest player in the market whose backers include celebrated veteran investor Warren Buffett.

Just like Ryanair, JetBird has decided on one aircraft type – a Phenom 100 very light jet (VLJ) made by Brazilian aircraft manufacturer Embraer. This helps to streamline maintenance and keep costs to a minimum. By contrast, NetJets operates about 14 different aircraft types in its fleet.

“Complexity equals costs and we try to take complexity out of our model,” he says.

JetBird also plans to sells most of its flights via the internet. A dummy booking system will be in place shortly. Prospective customers will be able to log on to the website, punch in their flight requirements and get a price instantly. “We don’t have a huge sales force, a huge call centre or a broker to take a feel. We are cutting out the middle man.”

There are other things JetBird won’t do. “We won’t do long haul, we won’t take more than four passengers and we won’t do Russia or North Africa, because if there’s a technical issue you won’t get it out of there for several days,” he explains.

JetBird gets its first aircraft delivered in June. It expects to have six by its launch in September and 10 by the end of this year. It should take delivery of another 15 in 2010 as its expansion gathers momentum.

“Then it depends on the market,” he says. “We have the opportunity to take more aircraft at an earlier stage.”

The business plan, however, “stipulates” that it has 100 aircraft by 2013. “I think that’s very likely,” Vilner says.

JetBird is pencilling in carrying 273,000 passengers a year when it has 100 aircraft, which would equate to roughly 2 per cent of the business air travel market today. “That’s absolutely nothing,” he says confidently. “We are already looking at JetBird 2 or JetBird 3.”

This is a reference to possible offshoots in the Middle East and North America, which would be standalone operations.

JetBird is the creation of Clare-born financier Domhnal Slattery and is backed by his Claret Capital private equity group, which in turn numbers Senator Feargal Quinn and his family as investors. Last September, a Saudi family paid €10 million for a 9.3 per cent stake in JetBird. The Irish airline is thought to be in talks with the Saudi investors about the possibility of launching a similar venture in the Middle East over the next three years.

JetBird also secured $10 million in debt financing from Royal Bank of Scotland to pay for the delivery of aircraft. In the current climate, funding is everything and Vilner highlights how 10 executive jet companies in Europe have disappeared off the radar in the past couple of years. These include Bikkair, a fellow low-cost aspirant using VLJs.

“They have gone because they couldn’t get funding,” he says.

Vilner said JetBird has enough funding to get it through until the end of 2010. A new fundraising drive is likely before then.

Vilner took the controls at JetBird in May 2007, having spent four years with Sterling, a Danish low-cost carrier that has since been grounded by the credit crunch. At Sterling, he was responsible for revenue and yield management, advertising and branding, and distribution and product development. The Dane also spent three years working with Go, a low-cost carrier set up by BA.

The preparation for the launch will move up a gear in the next couple of months. About €1 million will be spent on publicising its take-off. The first of its Phenom aircraft will arrive in June, allowing the airline to carry out flight tests and giving potential customers the opportunity to kick the tyres, so to speak. Sales reps will be appointed in Germany in August.

Broadly speaking, it will operate on routes along the corridor from London to Rome and east and west of these cities. He expects a lot of traffic from Germany’s Rhine-Ruhr area – one of Europe’s biggest metropolitan regions.

He doesn’t anticipate getting much trade from Ireland, given that most executives here are travelling to London, which is already well served. Besides, in the current climate, travel by jet and helicopter is seen as crass.

Vilner still has a long checklist of items that need to be ticked off before its first flight in September. The Dane admits that only then will JetBird’s backers know for sure if this project will fly.

“Theoretically, we won’t know if we have any bookings until the night before,” he admits. “But there’s a solid level of interest out there for bookings. I don’t worry too much. If we can keep our costs down, we’ll be fine.”