New semi-private jet service from Southern California to Maui is getting a lot of attention. Aero flies a 12-passenger Gulfstream IV from Van Nuys to Kahului at a starting price of $5,495 each way as a scheduled charter departing from private terminals.

Credit: Aero

This is surprising to some because Van Nuys airport doesn’t allow schedulde flights. It’s a public airport that’s been kept exclusively for the wealthy, largely for use on private jets. And scheduled air service – even expensive air service, but that can be purchased ‘by the seat’ – is grating to some of them.

Credit: Van Nuys Airport

So how is Aero able to do this? JSX recently launched scheduled service from Teterboro airport in New Jersey, the preferred home of private jets in the New York City area.

And The Port Authority of New York New Jersey has much stricter rules against scheduled service there, banning any flights that are ‘held out’ for sale. So JSX doesn’t advertise Teterboro service (it’s “New York”) and doesn’t sell it to anyone, restricting seats to members of their private club. They just launched a frequent flyer program that’s free to join, and the flights are only available to members.

The Van Nuys airport has an even easier workaround.

• They prohibit scheduled operations.
  
• And they adopting the FAA’s definition which doesn’t include scheduled charters
  
• They don’t like it! They just don’t think they have the legal right to do more than that. Remember, an airport runway is like a public highway. And when they accept federal grant funds for the airport, federal rules apply.

The CEO of Los Angeles World Airports says there’s nothing they can do about it (item #4). But that’s also why they joined the fight that the Air Line Pilots Association, American Airlines and Southwest Airlines waged against scheduled charter operations two years ago. It makes for strange bedfellows.

Facing a pilot crunch, SkyWest proposed a part 135 operation that would allow them to hire co-pilots with fewer hours of experience (who hadn’t picked up bad habits in repeated clear air touch and go at the same airports just trying to rack up hours) and without mandatory age 65 retirement.

Seeing a threat to the occupational licensing rules that pilot unions had fought for, in order to limit the supply of pilots (making it more expensive and time-consuming to become one) and drive up wages, they began a lobbying campaign – that largely targeted JSX as the largest scheduled charter operator.

• Unions: sought to have the government ban carriers flying from private terminals with 30 or fewer seats, using retired senior captains from major airlines and newer co-pilots who would learn from them, in order to ban a path for pilots to do paid flying while earning hours that becomes a path to major airline cockpits.

• Airlines: JSX is based at Dallas Love Field, so directly competing with Southwest and American. And they offer a better premium product on short flights than American does. So these two carriers wanted to shut down competition. They didn’t want consumers to have more choices.

  American AIrlines CEO Robert Isom admitted that it was about blocking competition in a closed-door meeting that leaked. The former CEO of American Airlines Doug Parker, and COO of Southwest Airlines Andrew Watterson, also put the TSA Administrator up to a separate crackdown on JSX.

• Small airports: responding to local pressure from wealthy constituents who want to preserve the space for their own jets, and from neighbors opposed to any additional flying near them, joined in the fight in cases like Van Nuys.

Last June, FAA Administrator Michael Whitaker announced that the agency was going to effectively shut down ‘by the seat’ scheduled charter operations, requiring them to conform to the rules of most part 121 (commercial airlines). That could have meant banning them from airports that aren’t certified for major airlines, banning them from private terminals, and requiring them to incur significant costs that would have put them out of business.

These operators use smaller planes for a reason. 9-seats don’t need a co-pilot. 18-seats don’t need a flight attendant. And 30-seats can still use private terminals and less expensive pilots. Raise the costs, and not only are the aircraft and fuel costs per passenger higher in a small plane but there aren’t enough passengers to spread pilot wages across.

None of this happened, though. Administrator Whitaker said there would be a Notice of Proposed Rulemaking promulgated before the end of 2024. The Biden administration added it to the Unified Regulatory Agenda. But it stalled. Administrations changed, and so did heads of the FAA. The new FAA chief, Bryan Bedford, has been a critic of the 1,500 hour rule in the past. He knows that it’s pure rent-seeking on the part of the pilot unions, and does not contribute to safety (other rules, like pilot rest that were adopted at the same time, do matter).

JSX wrote to the FAA in April seeking formal withdrawal of plans for a rule. The rule was sidelined, and the planned Safety Risk Management Panel the FAA was to convene appears never to have been formed. But the agency has not acted on JSX’s request (though the new Administrator was only installed last month).

Meanwhile, new TSA rules to require metal detectors and liquid bans for scheduled charters, but Doug Parker’s effort there was unsuccessful putting American Airlines competitors out of business.

The irony, of course, is that in protecting part 135 carriers the Trump administration is making possible innovation in electric aircraft, a supposed Biden administration priority that its FAA was undermining.

Support and capital to develop electric planes – especially short takeoff and landing planes – will come from part 135 operators. These aircraft are being developed as 9, 18, and 30 seat aircraft precisely to fit missions that work at the airports part 135 carriers can fly to, aand under part 135 rules. Impose major carrier pilot costs, spread out over just 9 or 18 seats, and economic demand for these planes never takes off. Allow them to develop and there’s a real opportunity for non-stop flights connecting small cities, bypassing hubs and without the need for subsidies.

Much like Tesla began the electric car revolution with premium cars (model S, X) that funded the development of cheaper alternatives, $5,000 flights out of Van Nuys are part of a business model that supports small community air service with a new generation of aircraft technology.