The Dallas based jet membership company, through its operating entity, Superior Air Charter LLC, has just filed for Chapter 11 bankruptcy in Delaware.

Just two weeks ago JetSuite grounded all its aircraft and furloughed most of its roughly 100 employees. The bankruptcy filing lists assets of less than $10 million and debts of $50 million to $100 million.

The court documents note the company was “beset by the incredibly tight margins common to the charter airline industry and was never able to operate profitably.” The Chief Restructuring Officer, Ted Gavin of Gavin/Solmonese LLC said “The global circumstances brought on by the Covid-19 pandemic have caused JetSuite’s revenues to drop to near zero, and the carnage across the economy and in the aviation industry in particular is well reported and has no clear end in sight." This echoes the comments made by JetSuite CEO Alex Wilcox just a few weeks ago, prior to the fleet grounding.

A large portion of the debts are the balances on SuiteKey memberships, the JetSuite jet card product. Netflix tops the list of creditors at $931,098, while most SuiteKey membership deposits were sold between $100,000 to $500,000. Hourly rates varied by the level of the deposit and were in the region of $4,675/hour for the firms Phenom 100 and $6,595/hour for their Phenom 300. Of the top 30 debts, 29 of them are for SuiteKey memberships, with the smallest amount in the top 30 being $219,000. The one other debt in the top 30 is $658,000 owed to Jet Support Services for aircraft maintenance.

The company home page currently says “JetSuite has safely operated over 111,000 flights since 2009. It will seek bankruptcy protection to reorganize, preserve and maximize the value of its assets, and potentially resume operations.”

The regional airline JSX is not part of the bankruptcy filing.

Major economic downturns can claim victims in the aviation industry, just at they do in all industries. Fractional operator Avantair filed for bankruptcy as we came out of the last major downturn. Part of the problem at this Piaggio P180 operator was that it simply charged too low a price.

As an interesting aside, the $50m+ of deposits is around about the cost of the JetSuite fleet new. The Phenom 300 costs about $8.5m and the Phenom 100 about $4.5m. 

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