Best Positioned Fractional

[glasspilot]

The biggest piece of the cost is NOT the plane.

Here's proof:

Cost of plane: ( Hawker 400XP at NetJets)

$8,000,000 'ish for the whole plane. For a 1/16 share that's $500,000.

Depreciation is around $100K, deductible up front. So you spent $400K on you plane.

Now, your "other" costs are $5,280 a month and $1,654 an hour (times 50 hours a year).

$5,280 a month times five years is: $316,800
$1,654 an hour times 50 hours a year times 5 years is: $413,500

Add those together is $730,300. (316,800 + 413,500)


So, for the slow minded here is the breakdown:

"BIG PIECE" price of purchase: $400,000
Rest of picture: $730,300


Oh yeah, and at the end you STILL OWN a $400K airplane that you can sell and re coupe a VERY significant portion of your "big piece" of investment.

Bottom line: If you think the cost of acquisition is a major factor in fractional ownership then you are retarded. I'm looking at you Trash with your Fulcrum flight experience!

 

[lowspeed]

In my old gig I operated two airplanes for my boss. The smallest part of the deal was the actual aircraft cost for use. We ended up making money on one when we sold it. Kinda sucks to sell your own job away. Anyways I didnt mean to start a cat fight, Every fractionals cards are expensive compared to a share ownership. One of the good things I have heard owners talk about at avantair is how after their term was up they got back 90% of what they paid up front.

 

[glasspilot]

It's not a "cat fight". It's just the ignorant getting educated.

 

[lowspeed]

sorry glass bad use of a word... my bad

 

[doh]

I have nothing to add to this post except to say it's been a while since I've seen someone post a thoughtfull question and recieve so many good responses. God it's good to be out of the airlines.[/quote]

Amen my brother, amen.

 

[transpac]

Don't want to be pessimistic, but in my view the fractional business is facing a slowdown if not a retreat. Corporations are under a microscope on perks and salaries and financial institutions are in a meltdown. Even the super rich have lost huge chunks of their net worth with the fall of the financial sector of the economy. It's unlikely that the proposed taxpayer bailout will allow business as usual, so my guess is we face a rough couple of years in this business.

 

[JokerFuel]

Any economic downturn is in direct proportion to my seniority and proximity to upgrade. Stagnation ahead!

 

[Photoflight]

Any economic downturn is in direct proportion to my seniority and proximity to upgrade. Stagnation ahead!

DAMN YOU!

 

[theskyking]

Any economic downturn is in direct proportion to my seniority and proximity to upgrade. Stagnation ahead!

In spite of all its flaws, thank you IBB. I will be a lot farther ahead financially than otherwise during this stagnation.

 

[Schrode]

One consideration is also WHO is looking at fractional ownership.

In a market downturn, the guy who owns his own jet and employs several pilots sees the fractional ownership option as an inexpensive alternative while maintaining his/her personal quality of life.

In a Bull market, the guy who just made his first 30 million sees fractional ownership as a good way to become a jetsetter - without spending the whole 30 million in one shot.

Our competition is not "First Class" seating on the airlines.