Summary
- Honda Aircraft terminated a fleet purchase agreement with Volato, which totaled $161.5 million in May 2023.
- Honda will retain its deposits on 23 HondaJet HA-420s but Volato can exercise individual purchase agreements for each of these aircraft.
- Recent shakeups at Volato include selling its aircraft management business segment to flyExclusive and operating 13 fully fractionalized aircraft, among other aircraft.
Late last week, Private Jet Card Comparisons reported that Honda Aircraft Company terminated a previously-agreed to fleet purchase agreement from Volato. In a filing to the Securities and Exchange Commission (SEC), Volato Group reported that Honda Aircraft Company terminated its fleet purchase agreement (FPA). This filing was made by Volato Group on Friday, September 13.
Termination of a fleet purchase agreement
The SEC filing from Volato Group reported that the FPA was terminated effective immediately. The original FPA was contracted on May 5, 2023, which included the acquisition of 23
HondaJet HA-420
aircraft from Honda Aircraft Company by Volato. This purchase agreement totaled $161.5 million. Each of these 23 HondaJet HA-420s were to be delivered from the fourth quarter of 2023 through the fourth quarter of 2025.
However, with the termination of the FPA, Honda Aircraft Company will retain the deposits of each of the aircraft made by Volato. The charter company will have the option to exercise an individual purchase agreement for each of the aircraft it had previously put a deposit on. There was no immediate reason specified for why Honda would terminate this FPA.
Recent shakeups at Volato
The termination of the FPA comes just weeks after Volato reported that it had sold its aircraft management business segment to flyExclusive. This means that flyExclusive will operate all of Volato’s aircraft for the Atlanta, Georgia-based charter company. It also means that flyExclusive will take over all flight operations, sales, and expenses of the existing Volato business jet fleet. Volato currently operates 13 fully fractionalized aircraft, 8 leased aircraft and 4 managed aircraft.
At the time, the Chief Executive Officer (CEO) of Volato, Matt Liotta, spoke about the new deal, stating,
“flyExclusive is a proven operator with a robust platform and unwavering focus on the customer experience. This agreement provides mutual benefit to both of our companies and, most importantly, our customers benefit by increased flight and service options with the reliable and high-quality service they have come to expect from best-in-class operators.”
FlyExclusive is expected to continue operating its large fleet of aircraft, which includes several Cessna Citation private jets and several Bombardier Challenger 350s. However, Liotta also stated that it would continue to sell fractional shares for its yet-to-be delivered aircraft, many of which were HondaJet HA-420s.
Photo: Volato
As these fractional shares were purchased, the aircraft will also become part of flyExclusive’s managed fleet.
It is unclear if this was a major factor in Honda Aircraft Company terminating the Volato FPA. However, Honda Aircraft Company has a history of ensuring its fleet is operated to the agreed upon fleet contracts. In 2022, Honda Aircraft Company sued Jet It for violating its FPA by reselling HondaJet aircraft.