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"We deeply regret the disruption and hardship to customers, suppliers and employees caused by this unexpected shutdown of commercial operations," DayJet founder Ed Iacobucci said in a prepared statement announcing the decision. "During the past year, we have demonstrated, beyond a reasonable doubt, that customers will sign up, purchase and become frequent users of this new service - the DayJet 'per-seat, on-demand' model works," he said.

Iacobucci has maintained over the past year that his company was able to attract the market that it had expected. DayJet claimed a base of more than 2,400 members and had flown more than 9,000 segments totaling more than 1 million miles since launch, according to the company.

"It is unfortunate that these developments have come at the same time our nation has fallen into the most serious capital crisis of our lifetime," Iacobucci said. "Regrettably, without access to growth capital, we have no choice but to discontinue operations." The company added it is unlikely that DayJet will secure the necessary financing to resume operations.

DayJet was forced to scale back its aggressive growth plans in May. The company believed that it needed to have 30-50 aircraft in its fleet serving 20-30 "DayPort" markets - where the company would have ground infrastructure in place - to achieve the critical sales necessary for profitability. DayJet had made strides toward reaching those goals with 28 aircraft in the fleet and a dozen Dayports in the Southeast.

Much Of EA-500 Fleet Unavailable

But it wasn't enough, and Iacobucci last summer said the company needed to rely upon operational efficiencies since the capital markets had deteriorated (BA, Jun 16/274). Also, while the DayJet fleet numbered 28 aircraft, only about 10 of those Very Light Jets were available for operations on a given day. Some were taken out of air taxi operations for training purposes, but others had been sidelined for retrofits of equipment or other issues. Iacobucci said the Eclipse had proved to be a "really nice little aircraft for what we do with it," saying it matched the air taxi model with short routes. But he said last summer that DayJet would be "much happier when we get all of the IOUs and post-delivery commitments" that Eclipse Aviation had promised.

DayJet this month pointed to the ongoing problems with the Eclipse aircraft as another factor in its decision to end service. "The company's operations have also suffered as a result of Eclipse Aviation's failure to install missing equipment or functionality or repair agreed technical discrepancies in accordance with the terms of DayJet's aircraft purchase contract," the company said.

The Transportation Inspector General's office - which investigated the process involved with the certification of the Eclipse EA-500 - said that DayJet had submitted 84 Service Difficulty Reports for the aircraft (BA, Sept. 22/129).

DayJet had been Eclipse's largest customer, and initial plans called for the Boca Raton, Fla. based operator to take up to 100 of the aircraft this year. Eclipse said it "still has hundreds of orders to fill independent of DayJet, and existing customers will be happy and eager to move up in line."

Eclipse also credited DayJet with demonstrating demand for the air taxi market, even though it was unable to raise the requisite capital. "The air taxi market is now a proven market, and Eclipse anticipates other companies will look at the market to determine how the needs of the regional executive traveler can be realized," the company said.

DayJet told customers that it was unable to honor future reservations or refund advance payments. The company said it was not able to warn customers of the pending shutdown because it was trying to secure financing up until the last minute, but ultimately had to discontinue all jet services immediately when that late-hour effort failed.

Other upstart air taxi companies, however, immediately said they would provide support for DayJet customers. "DayJet shined a bright light upon the emerging next-generation air taxi industry and it is our duty to help affected passengers and communities," said Joe Leader, president of the Air Taxi Association. "Immediately after DayJet's air operations stopped, our air taxi carriers in the region stepped forward to help." Three of the companies, SATSair, ImagineAir and North American Jet, operate to the 60 affected communities that DayJet had served. The companies have offered "support, ticket price matches and/or air taxi flight discount," the association said.By aviationweek