Charter/certificate/management question

[G100driver]

First-- let me answer the question of a mechanical.

The charter/management company is for all intent a broker of trips with the owner receiving on average from 80 to 90% of the revenue generated. Obviously the aircraft owner is going to lose on this scenario.

Of course the owner has 100% of the risk and costs. Charter/Management companies own and stand for nothing. If they would be willing to take the risk then I would be much more impressed.

Aircraft is chartered 250 hours per year at $4000 per hour net to owner. Revenue $1000000 cost $500,000. Net $500,000.

What you failed to mention was that it cost an addition $350,000 dollars to operate that airplane (250 X $1400 hr of DOC) Now that MX costs the owner real money.

I have the most respect for charter companies that actually own there own aircraft. Executive Flight in KEAT is great example. They own their lears, challenger, and turbo commander. All of their pilots go to school every 6 months ... AND they get paid a living wage. They may cost a bit more, BUT they do it right.

To give an example (I do not know if they still do this): when I thought about going up there in '99 the CP said that there was no pilot contracts. Instead he gave a $15,000 (?) cash bonus at the end of 3 years. WOW an incentive to be loyal, not the baseball bat the used these days.

To get back to the subject asked by Jonny. Your boss is going to do what he is going to do with or without you. Just remember you need his loyalty to you when it comes to dealing with the charter/management company. They WILL be dishonest with you, they WILL try and undercut your position with your boss and the WILL NOT take care of you, the pilot. Look out for number one ... the charter/management company will not because they are doing the same ... looking out for number 1.

Good luck.

 

[GVJeff]

Be sure and ask the charter company this when you are negotiating. "Let's say I do an aircraft re-position to L.A. to fly a guy back to FL. We break in LA and it is going to take 4 days to get fixed. Your customer is going to want another airplane, right? How is the aircraft owner going to re-imbursed for flying the airplane back and forth across the country while it is getting fixed?"
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Lets say you fly your boss from Florida to L.A. for a meeting. The airplane breaks in L.A. and your boss has to charter another airplane to take him home. How is the aircraft owner going to get re-imbursed for flying the airplane back and forth across the country while it is getting fixed?

 

[G100driver]

Lets say you fly your boss from Florida to L.A. for a meeting. The airplane breaks in L.A. and your boss has to charter another airplane to take him home. How is the aircraft owner going to get re-imbursed for flying the airplane back and forth across the country while it is getting fixed?

There is inherent risk when OWNING an airplane. The charter/management companies own nothing ... while you take the risk.

 

[GVJeff]

I have never understood the tax offset when compared to devaluing your interior (yea I know you can replace and depreciate) and running extra cycles and wear and tear on your airplane.
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Interior on the aircraft I fly these days (G-V) is about $2.5 million to re-do. First year tax benefit on a new G-V is about $5.5 million to have it on Part 135. Years following, it's about $1.2 million until year five at which point it becomes zero. That's a lot of interiors, and cycles.

 

[G100driver]

Yes Jeff, but that is depreciation. It is not as if those tax dollars just disappear.

I realize that for some owners charter is an OK. I just have yet to meet them. By the end they all hate the management companies and are soured on aviation.

 

[Spooky 1]

Idea?

All the above posts have good information and intentions. You might try TAG Aviation and ask about their Charter Ally program. Don't know if a Lear 35 is their type of charter aircraft, but none the less they run a good program that at least tries to mitigate most of the points brought up in these earlier posts. Their main offices are in HPN and SFO.

 

[G100driver]

All the above posts have good information and intentions. You might try TAG Aviation and ask about their Charter Ally program. Don't know if a Lear 35 is their type of charter aircraft, but none the less they run a good program that at least tries to mitigate most of the points brought up in these earlier posts. Their main offices are in HPN and SFO.

To be honest, I have heard good things about TAG. They have dedicated crew and DOM's. You must be willing to pay for your own DOM