A version of this article first appeared in CNBC’s Inside Wealth newsletter with Robert Frank, a weekly guide to the high-net-worth investor and consumer. Sign up to receive future editions, straight to your inbox.

Private jet flights fell 15% in the first half of the year compared with their peak in 2022, as the industry grapples with waning demand and a new competitive landscape for high-end travel.

Despite a short boost from the Summer Olympics, with a record 713 private jet flights to Paris the last week of July, the private jet industry continues to lose altitude this travel season. Private jet charter flights dropped to 610,000 in the first half of the year, down from 645,000 last year and 716,000 in 2022, according to data from Argus International.

The two-year decline highlights the ongoing correction in the world of private aviation, as the surge of new jet card members and charter fliers who started traveling private for the first time during Covid pulls back. Even ultra-wealthy travelers are showing signs of spending fatigue.

“During the peak, everyone was saying, ‘People who fly private for the first time will never go back to commercial,'” said Rob Wiesenthal, CEO of Blade Air Mobility, the air charter and helicopter company. “Well guess what? Many went back. And they’re still going back.”

The industry is still ahead of 2019 levels, and experts say if you take out the aberrational spike in 2021 and 2022, business has been rising along its usual growth path. Yet the boom times of the post-Covid era created a wave of euphoria in the industry, ushering in a burst of IPOs and startups, and a mad scramble for jets and pilots. Now, many say, all that expansion is setting the stage for a shakeout.   

Wheels Up, which went public in 2021 through a SPAC, saw its stock plummet more than 90% before Delta Air Lines stepped in to help rescue the company with an investment and partnership. Wheels Up has never made a quarterly profit and last week reported a second-quarter net loss of $97 million and a 29% year-over-year decline in members.

The company’s CEO, George Mattson, said Wheels Up is making solid progress and that, “Our work this quarter further solidified our position at the forefront of delivering integrated global aviation solutions that seamlessly combine the previously separate ecosystems of private and commercial travel.”

Jet It, a large U.S. private jet operator, shut down last year after grounding its fleet of Phenom 300s, Gulfstream G150s and HondaJets. VistaJet has faced repeated concerns and media reports about its debt load, though founder and Chairman Thomas Flohr told CNBC in May that “all documents and data was always available to our equity and debt-holders.”

Industry experts say some of the smaller charter operators may soon face tough decisions, as fleets sit idle and demand falls.

“The smaller operators with three, four or five jets, they’re the ones hurting,” said Doug Gollan, founder and editor of Private Jet Card Comparisons.

The recent challenges and fleeting success in private aviation trace back to Covid. In 2020, as airports and airlines shut down, private jets offered an escape and safer way to fly. Wealthy travelers who had rarely, if ever, flown private due to the cost and energy consumption, could now justify isolating at 40,000 feet.

“There was this whole section of the population that could afford to fly private, but they were always reluctant because they didn’t like the optics,” said Jay Duckson, founder and president of consulting firm Central Business Jets. “With Covid, they had a reason to fly private. You had a massive uptick in demand.”

The flood of liquidity from government spending, stimulus, low interest rates and a booming stock market also created record amounts of wealth to pay the soaring costs of flying private. Companies rushed to buy planes, hire pilots and sign up new members. Before 2019, there were only a few months where private jet charters topped 100,000. In 2021, almost every month exceeded 100,000, with July 2021 topping 300,000 flights.

The demand overwhelmed the industry. Private jet passengers who paid six figures for flights started facing delays and cancellations as operators couldn’t buy or lease planes fast enough. Shortages of pilots and parts also grounded fleets.

In 2023, demand started to slide even as more planes and pilots started to come online. Some wealthy fliers felt they could no longer use Covid as an excuse — to themselves or to others — to fly private. For others, the soaring prices of flying private simply got out of hand.

“Prices are about 20% higher than they were in 2019,” Private Jet Card Comparisons’ Gollan said. “A lot of people are saying, ‘I spent $300,000 or $350,000 on flights last year, I’m not going to spend $400,000 or $450,000 this year.’ Even if they have the money, they have a dollar figure in their head they don’t want to go over.”

Along with reducing flights, some fliers simply started flying commercial for easy city-to-city trips, mixing both commercial and private throughout the year. In his latest survey of private jet fliers, Gollan found 87% “switch between airlines and private, depending on where they’re flying.” 

With demand lower, unsold planes are piling up again and prices are softening. The number of used business jets for sale jumped 17% in July compared with a year ago, according to a report from Jefferies. Prices fell 7%, according to the report. While orders for new jets remain strong, the wait times have fallen from as much as three or four years to about two years for many models, according to jet brokers.

Many industry executives welcome the drop in demand, saying the industry is returning to a more balanced equilibrium, with profitable routes, available planes and happier customers.

“The industry is on a more sustainable long-term path,” said Travis Kuhn, senior vice president of software at Argus. “It’s not a bad thing that it’s cooled down a bit.”

Gollan said that while some of occasional fliers may have drifted out of private aviation, the “heavy users” are still flying. His survey showed that 95% of those surveyed who started flying private during Covid are still flying privately, with 77% in a membership, jet card or fractional program.

Industry giant NetJets, owned by Berkshire Hathaway, has also benefited, as more people switched from charter to fractional ownership due to better reliability and quality. The number of fractional flights actually increased 12% in the first half of 2024, to 308,000, according to Argus.

“Some of these new fliers looked around and assessed the market, and they like the fractional model,” Kuhn said. “It’s a set number of hours and a bigger fleet.”

Disclosure: CNBC parent NBCUniversal owns NBC Sports and NBC Olympics. NBC Olympics is the U.S. broadcast rights holder to all Summer and Winter Games through 2032.