Shares of FlyExclusive, a private jet company that recently completed its merger with EG Acquisition, took a hit in its stock market debut. The stock plummeted nearly 48% to $6.24 shortly after the market opened.
Private Jet Boom during the Pandemic
The demand for private jets soared during the pandemic as some travelers became concerned about health risks associated with commercial airlines. FlyExclusive, along with other companies like Flexjet, Wheels Up, and NetJets, benefited from this trend.
Challenges in the Industry
However, the private jet industry has faced challenges this year. Higher interest rates, inflationary pressures on consumers, and rising costs for fuel and pilots have weighed it down. Flexjet even cancelled its plan to go public through its own SPAC deal, while Wheels Up received a $500 million rescue financing package from Delta Air Lines.
Despite these challenges, Chief Executive Jim Segrave remains optimistic about FlyExclusive’s future. He stated that the company will fly more hours this year compared to 2022. Once customers experience flying privately, they prefer it over commercial flights.
Holiday Travel Season
Segrave noted that demand during the holiday travel season has been strong. However, customers booked their flights a week or two later than expected. He attributed this to people having more confidence in booking last-minute flights as airport operations have normalized since last year.
FlyExclusive is focused on vertically integrating its operations. The company handles much of its jet maintenance from its base in Kinston, N.C., and is also working on opening a pilot-training center.
Overall, while FlyExclusive faced a stock market setback, the company remains bullish on the future of private aviation.