When you think of air travel, commercial flights likely come to mind first. However, there's another option that offers flexibility and unique travel experiences: public charter flights.
In this blog, we'll explore what public charter flights are and provide essential information to help you plan and book for your upcoming travel.
What are the three types of Charter Flights (as defined by the DOT)?
Single Entity Charter Flights
Single entity charter flights are entirely booked and paid for by a single organization or individual, meaning the cost is not divided among or passed along to individual passengers. This type of charter is often used by corporations, sports teams, or large groups who need exclusive use of the aircraft.
Public Charter Flights
Public charter flights are non-scheduled flights arranged by an organization who contracts an aircraft to fly to specific destinations. These flights are then advertised and sold to the public, either directly, through travel agents, or as a part of travel packages. These are regulated by the DOT and must comply with specific DOT regulatory requirements.
Affinity Group Charter Flights
Affinity group charter flights, on the other hand, are arranged for a group of people who share a common interest or affiliation, such as a club or association. These flights are typically sold on a pro-rata basis, where each passenger pays a portion of the total cost. Unlike public charters, affinity group charters are not open to the general public and require passengers to be members of the specific group.
Does my group classify as an Affinity Group or Public Charter?
As you start to determine which category your group falls into, it is important to understand that you do not get to 'choose'. Public Charter Flights are regulated by the Department of Transportation. If your organization is marketing/selling tickets or packages to the public, then it is a public charter flight.
Affinity groups cannot sell airfare to the general public.
The DOT has regulatory requirements that govern Public Charter Flights to protect the interests of those individuals' purchasing seats on the flights.
I am organizing a Public Charter Flight - where do I start?
If you are organizing a Public Charter Flight and are unfamiliar with the regulatory requirements or processes, it is important to speak to somebody who can help guide you in the right direction. Some questions you should ask yourself:
Is there demand and a market for this flight?
Odds are a public charter flight will run more than general commercial flights. If you are coordinating a public charter flight for a large sporting event, for instance, will those fans pay more for the convenience of a nonstop flight, where there might not be one with commercial airfare? Whatever the trip, it is important to know if there will be demand for it for you to sell and market packages.
Who will I market the flight to, and what price points will the market tolerate?
As the organizer of the public charter flight, you will be paying for the aircraft regardless of the number of tickets you sell. Having an understanding of the costs and how much you need to sell packages for is a good starting point.
Am I prepared to take on the costs and risks associated with a public charter flight?
As the organizer of a public charter flight, you will be required to contract the aircraft prior to marketing/selling tickets (this is required by the DOT). You will be required to pay for the aircraft (it may be a deposit to secure and a final payment, or if it is close in, one single payment). The organizer of the charter flight is required to pay for it, and cannot use funds from the public to do so.
All funds received from the public for tickets must live in escrow until the completion of the charter flight. So, the organizer is taking on the financial risk of the flight, not the general public that is buying tickets. In a nutshell, the people that purchase tickets on the flight are not investors in the public charter flight.
What else do I need to know?
In addition to the funds to secure the aircraft and an escrow account, you will also be required to have a bond. The bond is separate from the payments for the actual flight.
You need to secure your aircraft with a contract, payments, and file with the DOT prior to marketing/selling tickets. DOT filings will require information from you the organizer, your financial institution, your broker + their financial institution (if you use a broker), as well as the airline operating the flight.
This all sounds like a lot - is it worth it?
Yes, it can be worth it, and the process itself is not as scary as it seems if you plan appropriately. Reach out today to speak with one of our team members to learn more about the processes and get the ball rolling on coordinating your upcoming trip!