| FLEXJET Fractional Jet News Briefs (Courtesy of NetJets, "The Buyer's Guide to Fractional Aircraft Ownership") |
The popularity of fractional ownership is soaring because it delivers all the advantages of private jet ownership – and then some – at a fraction of the cost.
Availability is guaranteed, monthly maintenance costs and occupied hourly rates are guaranteed, and the liquidity of your investment is guaranteed. The fractional ownership provider will guarantee to buy back your fractional interest at fair market value less a remarketing fee. Fair market value is the price that a knowledgeable buyer would pay for an aircraft considering the total time on the airframe and engines, the condition of the plane’s paint and interior, its maintenance history, and its avionics.
Fractional aircraft ownership is such a good idea, in fact, that many Fortune 500 and other companies with flight departments of their own use fractional aircraft ownership to complement their fleets by providing expanded and more versatile transportation services to their executives. Others use it as their primary means of private air travel.
Buy a Share – Gain access to a fleet
With your fractional ownership interest you gain access to an entire fleet of private jets (through an interchange agreement with other owners in the program). You can often select an aircraft type different from the one that you own to satisfy a specific trip requirement. For example, you can dispatch a light or midsize jet for a few passengers traveling short to medium distances, or you can schedule a large cabin jet to fly a greater number of people non-stop across the continent.
A wise use of capital
You are able to match your capital investment precisely to your air travel requirements. For example, if you want to fly 50 hours a year in a light jet that has a cost of $6 million for the entire aircraft, you can purchase 1/16 ownership interest for just $375,000 rather than buying the whole aircraft – and save over 93% of the cost or $5.625 million. Further, your maintenance costs are hourly rates are fixed and predictable over the duration of the fractional ownership agreement and will be significantly less than if you owned the whole aircraft.
Most programs offer leasing and financing alternatives as well as outright purchase. Depending on your individual circumstances, there may be tax advantages to fractional ownership. If you use your interest more than %50 for business purposes, there are potential depreciation and tax benefits. Consult your tax advisor for guidance.
Turnkey convenience
Many individuals and domains find there are significant advantages to fractional ownership above and beyond cost savings. They prefer fractional ownership’s simplicity: they use the fractional company to recruit, train, and manage pilots, and to manage and maintain the aircraft. They just pick up the telephone, call their fractional program to schedule their trip, and an aircraft is dispatched to them at their desire location.
A good fractional program is backed by a superiors infrastructure – including pilot training, certified flight dispatch, in-house meteorology services, close maintenance supervision, flight planning, dedicated customer service representatives, security, and quality control functions.