HOMEAIR TAXI FAQARTICLESIN THE NEWSRESOURCESNEWSLETTERCONTACT US
Stay Informed
ATF Newsletter

Archive for June, 2008

A 54-Year-Old Prototype Of Small Airport Air-Taxi Service

Friday, June 6th, 2008

Riddle this, if you can.

What do you call an air-taxi service that operates more than 20 jets, flies over 16,000 hours a year, uses its aircraft to pick up and deliver people to and from an average of five or six regional airports a day, and doesn’t carry paying passengers?

Answer: Wal-Mart.

With about 17 Learjets (45s, 40s, 31s and 31As) and one long-range Bombardier Global Express (a Canadair Challenger was recently decommissioned) stationed at Rogers Municipal Airport (KROQ) near corporate headquarters in Bentonville, Arkansas and several other jets based at locations in Canada and Mexico, Wal-Mart is not only the world’s biggest retailer, it is one of the world’s largest and most prolific users of corporate aircraft.

What makes Wal-Mart Aviation, the wholly owned subsidiary that operates the Wal-Mart fleet, particularly interesting here is that its operating model is much more like that of an air-taxi operator than a typical Fortune 100 mega-corporation.

Traditional corporate jets, for example, are for the most part the flying preserves of top executives, board directors and occasional VICs (Very Important Customers.) Though Wal-Mart’s senior managers do, of course, fly on the company aircraft, they can be (and often are) bumped to make way for technicians or key line managers. In fact, the great bulk of Wal-Mart Aviation’s passengers are corporate middle-managers, store managers, buyers, inspectors and other employees — almost 25,000 of them a year — making under $100,000 annually.

The reason for this unusual corporate passenger mix is as simple and clear as the rationale for virtually all new-generation air taxi operations: Most of the business is done in places where the major airlines don’t fly.

Specifically, Wal-Mart operates approximately 3800 stores, the vast majority of which are not within a 20 minute cab ride of a major airport. Take, for example, the Wal-Mart store in Ponderay, Idaho, a major trading post for both Idaho Panhandle residents and thousands of Canadians who cross the border at nearby Eastport to shop at the Wal-Mart because it’s 30 or 40 miles closer to them than any similarly sized store in Canada.

Getting to and from Spokane International to the Ponderay Wal-Mart takes approximately 100 minutes in each direction not including time spent at the airport checking in, going through security and all the rest of the drill. Ground transportation from the Sandpoint Municipal Airport (which is, coincidentally, home to the considerably smaller Coldwater Creek clothing company corporate jet fleet) to the Ponderay Wal-Mart takes approximately seven minutes and eliminates virtually all the airport downtime beyond waiting for takeoff and landing clearance.

To understand why Wal-Mart finds it cost efficient to maintain such an extensive in-house “air taxi” system you only have to do the math. Putting the same mid- and junior-level road warriors on commercial flights would probably cut their maximum number of daily store or vendor visits to two, using the corporate jets they can average three to five.

Though Wal-Mart could, in theory, save millions of dollars in annual operating expenses by downsizing a substantial portion of its fleet to VLJs, it has no plans to do so, choosing, instead, to maximize the efficiency of its Lears by maintaining a load factor of plus-five passengers per flight leg.

“Our load factor is 5.2, so we really get incredible efficiency out of these airplanes,” Wal-Mart director of Global Travel Services Duane Futch said in an interview with Business Travel News. “We’re not just going out and dropping one person off. They always travel with a team that is going to do the job they have to do in the field. We don’t just drop that team off. That airplane is constantly moving. The typical Wal-Mart airplane will make between three and six stops a day: picking up people, dropping people off … moving them to another location.”

As is the case with many commercial air-taxi operations, Wal-Mart’s fleet management needs are sufficiently complex to demand more than an off-the-shelf management solution to handle passenger, crew, maintenance, inspection and other scheduling and back-office tasks. Building on Atlanta-based Seagil Software’s BART aviation management system, WalMart programmers fashioned a series of custom application extensions maximizing efficiency while retaining the flexibility to quickly change everything from routings to passenger lists in response to unforeseen circumstances requiring immediate attention (a computer system meltdown at a remote division, for example.)

Like many new-generation air-taxi operators, Wal-Mart Aviation also recognizes the importance of full-service, high-level ground services (think DayJets’ DayPorts). Not only does the company own and operate a private ATC tower at Rogers field, a wholly owned FBO at the airport, 22-year-old Beaver Lake Aviation, supplies everything from free popcorn to computerized weather tracking, executive conference rooms, crew quiet and snooze rooms, exercise facilities, washing machines and courtesy transportation to nearby restaurants.

And if all this isn’t enough to convince skeptics that Wal-Mart Aviation is really just an air-taxi company in corporate clothing, consider this: The company traces its history back to 1954 when Wal-Mart founder Sam Walton bought a single-engine Ercoupe 415 and began flying it to stores in Arkansas and adjacent states because it was faster than driving between locations on twisting Ozark Mountain roads.

Getting business travelers off the highways and up in the skyways. Today, half century after Sam Walton began practicing it, it’s become one of the primary mantras of the entire air-taxi industry.