Fractional vs. owned aircraft, pros and cons

[BoilerUP]

The flexibility a fractional provides a client in terms of AOG response and aircraft adaptability comes at a VERY steep premium, especially if you fly more than 250-300 hours per year.

In Oct 2007 our company did an analysis on replacing our Citation II with a quarter share of a NJA Ultra. The 1/4 share was $2.2M, and after all the surcharges & hourly costs related to the quarter share's 200 annual flight hours were totaled, we could operate our Citation II for around 350 hours...which is +/- 5% of our average annual utilization. Even taking the Ultra's marginally faster speeds into account, we were still money WAY ahead keeping our aircraft.

In our case, if we need lift to supplement our aircraft (in case of maintenance, AOG, etc) or need a larger aircraft for a particular trip, we can charter an Excel, Hawker, LR45, etc. (from a local vendor, EJM, etc) for substantially less cost than the premium paid for a fractional.

Fractionals provide a great product with superior flexibility...but that product simply isn't cost effective if you fly a substantial number of hours per year.

 

[cjdriver]

Seems like no company that uses their plane for actual business vs pleasure goes the fractional route. Most of the customers I flew in frac were pleasure trips. All of the trips I fly 91 for my company are business. Two different customer bases. If someone needs a ride to the beach or mountains, maybe frac is the way to go. If you need to fly 8 employees 1000nm to do business then turn around and get another 8, whole ownership is the way to go.

 

[CALRepublic]

My boss went to the fractionals and bought shares in a GIV for a few years. He gave up when he and his wife were waiting to be picked-up in the GIV and here comes a Citation that the previous passenger had thrown-up in, and they were running two hours late, the F/O started throwing the bags into the cargo compartment. I had to find some fabrezee and the boss and I ended up re-loading the bags. After this we received a brand new Challenger, Thanks’ to fractionals I still have a job.

Hang on to that one incident buddy.

I understand your frustation, but let's not go there. Are you going to tell me that never happens at a charter/flt. dept.??? You're flying along and someone throws up in your challenger, you're suppose to wait 5 hours and take'em back... What happens then???

Give us the pros of owning, let's not start bashing eachother.

 

[pilotviolin]

Pros of Owning:

*No need for passenger lists. Whomever shows up, gets on board.

*Complete Flexibility. If our Principles show up a half an hour to 3 days late it doesn't matter. Or Visa Versa..

*Destination changes in flight. Happens several times a year for us. No big deal.

* No B.S. fuel surcharges, Management fees.. e.g.

* Leave stuff on the airplane. Jackets, computers, bags, medicine, tools, always on the airplane when the need them.

* VFR flights, special requests. Took a trip once, scouting out Mt. Biking areas.

There are other ones, but there are pros and cons both way. It is like owning your own car and renting.

 

[gutshotdraw]

Pros of Owning:

*No need for passenger lists. Whomever shows up, gets on board.

Not when the TSA gets done with this LASP bu!!&hite. If the jet weighs more than 12, 500 lbs, you get to run no fly lists too. And pay to get a security plan authorized. And pay an outside third-party auditer every two years to check it. And get wanded and screened at the FBO. And get told you can't go to Smalltown USA because the security there is "inadequate." And you can't take the boss hunting anymore because his shotguns are a danger to national security.

Sorry, thread creep. Rant complete. Carry on.

 

[CA1900]

Seems like no company that uses their plane for actual business vs pleasure goes the fractional route. Most of the customers I flew in frac were pleasure trips....

My experience has been the complete opposite. More than half of my flights have been corporate accounts, flying on business trips.[/quote]

If you need to fly 8 employees 1000nm to do business then turn around and get another 8, whole ownership is the way to go.

Or with fractional shares, you could have them there are the same time, and not fly an empty round-trip.

*No need for passenger lists. Whomever shows up, gets on board.

Yep. And hopefully this LASP thing will get killed, and it'll stay that way.

*Destination changes in flight. Happens several times a year for us. No big deal.

Nor for us, either. I've done inflight destination changes on many occasions. We just let the company know where the plane's going, and they adjust the day's plan for the other flights. Not an issue at all.

* No B.S. fuel surcharges, Management fees.. e.g.

In place of those, an owned airplane has fuel bills, pilot salaries, benefits, insurance, hangar costs, maintenance costs, etc.

Agree with you on the other pros of owning. There are definitely pros and cons for both.

 

[FurloughedAgain]

Now you are my nemesis CA1900.

 

[Buckeye]

johnsonrod I wouldn't put to much faith in what KPMG says:
http://www.cheatingculture.com/kpmg.htm
http://www.google.com/search?sourceid=navclient&ie=UTF-8&rlz=1T4TSHA_enUS311US311&q=KPMG+scandal

 

[CA1900]

Now you are my nemesis CA1900.

I've always been your nemesis. :laugh:

 

[jehtplane]

As far as individual preferences go, at least at NJA, there is an individual profile on most of our briefs that can get quite detailed- I've seen profiles that include things like "customer prefers eggs to be cooked only in iron skillets" or "customer prefers a pillow placed on seat before arrival", or even notes to have certain products removed from the aircraft for allergies or if from competing companies and even music and movie preferences. These notes are easy to add to for following crews and do allow for a bit more "personal" feel for the customers even though they may never fly with the same crew more than once. We definitely have some passengers who are higher maintenance than others, but when things have gotten too unreasonable owners have been asked to leave the program (luckily I haven't had to deal with any of them). I haven't seen a note that requested 6 ice cubes, but if I find one that does I wouldn't have a problem fullfilling that wish as long as it was before the aircraft was moving- the customers are paying a lot of money to be there and I think they should expect a little more than the airlines offer for the money they are paying.

Gee, you think NJ's are the only one's that do that?