Sokol Says NetJets on Track, but Marquis a 'Weak Spot'

"All the changes we needed to put in place, I think we finished about six months ago," asserted NetJets CEO David Sokol, in an interview with Bloomberg Television. He  said "2008 was a huge wakeup call" and that NetJets bought back 53 airplanes from shareowners after the economy tanked. But he noted that the company now has a "sound foundation" and that the number of flights by shareowners will be up "close to 8 percent" this year. Net share sales will be down 1 to 1.5 percent, but Sokol said that "is also significantly better than the last two years."

He added that owner satisfaction numbers for the first half of this year were "the highest they've ever been" and that debt has declined from $1.9 billion in April 2009 to about $1.15 billion today. He referred to Marquis Jet-which provides access to the NetJets fleet via jet cards-as the "only weak spot out there" and said "they're shrinking substantially." Sokol also noted that he expects to step down from his position by the end of this year or the first quarter of 2011, to be replaced by one of his 16 senior team members.

NetJets' CEO had harsh words for Jim Jacobs, the company's cofounder and former vice chairman. Sokol said he was surprised that Jacobs "goes out and criticizes the company that he was poorly managing. He's argued that we should have been buying more airplanes this year and last year, which would be crazy. If he actually understood the business model that he was involved with, that would have been insane. They'd already bought too many aircraft. Secondly, he wasn't selling the older airplanes that they could have sold in 2007."

Added Sokol: "Some people, when they realize they weren't running a business well and it gets fixed, they find it in their interest somehow to hurt the employees that are there trying to make the company a success. And I don't understand it. I don't respect it at all."