Stratos Jets Explains the Deceptive Business Practice of Phantom Aircraft Bidding

A deceptive business practice, known as phantom aircraft bidding, has recently gained momentum with the increasingly-competitive atmosphere of the air charter market. Phantom aircraft bidding occurs when a charter broker offers a firm quote on an aircraft that does not actually exist in the charter market. These quotes, which are not based on actual aircraft availability, are well-below fair market value. This paints an inaccurate picture of the charter market and creates unreasonable pricing expectations in the minds of consumers.

What is phantom aircraft bidding?

As we stated earlier, phantom aircraft bidding occurs when a charter jet broker offers a quote on a non-existent aircraft. These charter brokers will typically try to lure you into a sale with a seemingly-great deal. Once the charter broker has procured a contract with a client, he or she will attempt to find an aircraft operator willing to settle for the agreed price. If the charter broker is unsuccessful in finding an aircraft, he or she will then tell the client that a mechanical, or some other unforeseen event, has occurred to prevent the flight.  The buyer is then left to find another aircraft at the last minute, usually at his or her own expense.

How do you know if your charter broker is bidding on a phantom aircraft?

There are a few tell-tale signs that your broker is bidding on phantom aircraft. If you have signed a contract with your broker, and he or she fails to provide you with the necessary details of the flight, such as departure times, FBOs, or tail number, that aircraft probably does not exist.  At the very least, your broker should disclose the operator of the aircraft you’ve chartered. You should also be wary of charter brokers who offer you the lowest-priced option, especially if the pricing is well-below other offers, as this is fair indicator of phantom aircraft. There are real costs associated with the constant upkeep and maintenance of a private aircraft, and these costs are reflected in the price of a charter flight. A good rule of thumb is if a price seems too good to be true, then it probably is. Another way you can arm yourself against phantom aircraft bidders is to refrain from “over-shopping” the market. If you contact multiple charter brokers for the same charter flight, you will most likely cause a “bidding war.” Due to the competitive nature of the air charter industry, some charter brokers will do anything to win a flight, even if it means bidding on a phantom aircraft. We advise that you work with one to two charter brokers who you know to be honest, reliable and trust-worthy.

Why might a charter broker bid on a phantom aircraft and what is the harm?

There are many reasons why a broker might in engage in phantom aircraft bidding. Most of the time, the phantom bidder wants to “win the trip” by outbidding his or her competitors who are providing pricing on actual aircraft availability.  In other cases, a charter broker may simply seek to lock a client into a price that he or she honestly believes they can get from a charter operator. Whatever the reason, phantom aircraft bidding is dishonest and puts the client’s safety at risk. A lot of times when a charter broker can’t find an available aircraft to fill the requirement, he or she may turn to an aircraft operator with poor safety ratings or source an unregistered aircraft that is privately-owned.  Even if the broker believes the aircraft to be safe, it may not have met minimum safety standards, have proper insurance levels, or be operated by a fully-certificated flight crew. These standards are a vital part of ensuring your personal safety on a charter flight.

How can you protect yourself against phantom aircraft bidders?

As we mentioned in the last issue of The Getaway, the best way to avoid deceptive business practices, such as phantom aircraft bidding, is to commit yourself to only working with members of the Air Charter Association of North America (ACANA). ACANA is a private collection of top industry professionals dedicated to promoting and upholding ethical business practices, safety, and consumer education. ACANA members never engage in unethical business practices, like phantom aircraft bidding, which is a founding tenant of our organization. The practice of phantom aircraft bidding has not escaped the notice of ACANA or Stratos Jets. As a member of ACANA, Stratos Jets hopes to inform our clients about phantom aircraft bidding and help to remove this deceptive practice from the industry. As a reminder, we will never engage in phantom aircraft bidding or any other deceptive business practice that puts our clients best interests at stake. At Stratos Jets, our company culture compels us to be honest and transparent with our clients. Our goal is to offer realistic pricing and remain faithful to our standards for safety. We promise to consistently provide our clients with the finest jet charter service in the industry that will make us their number one choice for travel.