Fractional Ownership News
Jet Republic ceases trading as funds dry up
Jet Republic, the fractional aviation company, has ceased trading after becoming technically insolvent.
In an email to staff, CEO Jonathan Breeze said: "It is with great regret that I announce that Jet Republic appears to be technically insolvent. The business expected to receive funds today that have not arrived, nor do we expect them to arrive in the immediate future. We needed these funds in order to continue as an operation. As such, we must stop trading immediately. We will place no more orders with suppliers; we will accept no more revenue from customers; we will solicit no more business from potential customers."
The company's demise comes after a turbulent few weeks in which rival NetJets placed an injunction on Jet Republic hiring NetJets employees. As recently as this week, Jet Republic launched a charter service to run alongside its fractional jet offer in an attempt to boost revenue.
Breeze added that he hoped to be able to offer staff further information "in the coming days and weeks". "It has been a most profound experience working with you all; I am extraordinarily disappointed that it appears that we will be unable to continue our journey together," he said.
A spokesperson for Jet Republic said: "The aviation market is enduring extremely difficult conditions at the moment. For example, in the first quarter of this year, business jet deliveries were down around 22% compared to the same period in 2008. Business aircraft manufacturers are expecting net negative orders for 2009 and the UBS used business aircraft index is at the lowest levels in almost 30 years, making it more difficult to place new aircraft. Until very recently, we remained very confident of meeting our objectives, but the aviation asset finance market has completely dried up making it much more difficult for potential clients to take out and obtain financing for fractional ownership of jets. We have therefore taken the decision to suspend our operations in Portugal until further notice. Our holding company is fully operational and will work closely with our shareholders to ensure that the interests of our existing clients, employees and suppliers are protected to the best of our ability."
It is a sad day for the fractional aviation sector as Jet Republic was a vibrant and innovative new player in the market which appears to have become a victim of the global downturn in the fractional jet market.