This article is part of a series of short papers published by the RISE team. As a relatively new provider of technology to the business aviation industry, the RISE team enjoys sharing their learnings and perspectives with those who are looking to “go lean and go green”.
How big is the 'empty leg problem' ?
Anyone working in business aviation, the world of on-demand air travel, knows about empty legs.
An empty leg is a flight with no passengers on board, and yet someone has to pay for all of the variable costs: airframe and engine hours, fuel, landing and handling charges, etc.
Imagine the worst-case scenario. An operator based at Paris Le Bourget, with a single aircraft, answers a request to take a client from Milan to Barcelona. The proportion of empty legs is close to 65% as it includes an empty flight from Paris to Milan, and a repositioning from Barcelona back to Paris.
Fortunately, a large, homogeneous, floating fleet will do better than that! The amount of empty legs generated by the business aviation industry is on average closer to 40%. And the best-in-class manage to reach 30%.
Whether it is 65% or 30%, the stakes are high – both economically and environmentally.
Or as George Antoniadis, the Planesense CEO, was telling us in a recent conversation:
“Controlling empty legs is the Alpha and Omega of our job”
Impact on the books
It can be assumed that variable costs in the business aviation industry weigh typically 50% of an operator’s revenue.
Hence it is estimated that poorly managed empty legs will have an impact on the bottom line of up to 10%.
But the cost of empty legs does not stop there. An operator that generates lots of repositioning also has lower fleet availability (to perform high-value flights), more complexity, more work for their teams and bigger chances of making mistakes.
Of course the impact will differ depending on the type of operation. In a private operation, the cost weighs entirely on the company’s books, and ultimately on the aircraft co-owners.
In a charter operation, a variation in the amount of empty legs might be felt in part by the operator, but also by the clients and the aircraft owners (if they are not the operator).
Hence, every minute of empty travel that can be avoided is a saving for everyone in the chain.
Impact on the environment
Every minute of empty flying is of course also unfortunate from an environmental perspective.
Our industry is growing, and so is its share in the overall amount of CO2 emissions.
At a time when the public is expecting more efforts from aviation, and perhaps even bigger efforts from business aviation, it is fair to assume that operators will be asked to make their best efforts to slash empty legs.
Following an intervention by the French government on “private jets” in the Summer of 2022, several media have started quoting “the 40% figure”.
Although environmental organizations have been more focused on “the 1% of polluters” so far, it is likely that they will start quoting these numbers as well.
Empty legs are indeed one of those characteristics that set business aviation apart from the airlines, along with lower seat density and lower seat occupation. All of these elements contribute to an image of ‘wastage’ which the industry needs to address in a much more effective way than it does today.
How has the industry managed empty legs so far?
The digital age has seen a number of online platforms emerge in an attempt to sell empty legs, compensating the lack of flexibility with a lower price. They have sometimes targeted a specific audience such as brokers (B2B) or the end customer (B2C). However none have reached critical size, due in part to the uncertainty –until the last minute– that an empty leg will actually fly.
The operators themselves have tried to sell more adequately. One can sell ‘smarter’ when the Commercial and Operations teams communicate more effectively. It is a lot smarter to sell a Milan-to-Barcelona flight if your aircraft is going to be in Northern Italy that morning; and it is even smarter if your aircraft is due in Spain that evening!
Can we do better?
There are solutions that help minimize the amount of repositioning, typically by optimizing the fleet schedule to ensure that the aircraft are routed in a way that will minimize wastage.
Beyond a handful of operators including Netjets (who are approaching 1,000 aircraft worldwide), no one appears to have implemented an effective solution to fight empty legs systematically.
Such solutions involve some modern technology. However, more than anything else, chasing empty legs requires focus within the management team. For an industry often preoccupied with the “bells and whistles” (i.e. the aircraft interiors and the service) there is huge value to be gained from focusing on running a smooth, lean operation that will minimize the creation of empty flights.
Any progress in that field is also far quicker to implement than developments related to new fuels, new engines, or new air traffic control procedures.