12. Page 3-3
3. Program Characteristics
Private Jet Travel: Understanding the Options
structured fee schedule removes much of the guesswork from business aviation
expenditures. Excluding adjustments for inflation, your total out-of pocket
expenses over several years can be identified even before your share is
Operational Considerations of Fractional
As noted above, the Fractional share you acquire dictates the number of flight
hours to which you are entitled. Many Fractional programs, especially the larger
ones, have built sophisticated aircraft optimization models that predict the best
way to position the fleet throughout the network. This allows the programs to
minimize positioning flights, thus lowering fleet operating costs, and giving
customers the ability to reserve a flight with minimal advance notice. However,
advance notice requirements do exist and often differ by aircraft and share
Service is guaranteed most of the time. When you "book" a flight, the aircraft will
be waiting for you at the departure airport - fueled, staffed, and catered as
needed for the trip (custom catering usually costs extra). Fractional programs
offer a standard time window during which you can arrive at the airport past your
scheduled departure time and avoid any late fees. If that standard is exceeded,
programs often reserve the right to redeploy the aircraft and assess a penalty
(which differs in each program).
Many Fractional customers cite the extensive in-house capabilities of the
program manager as a major factor influencing their purchase decision. The
program manager is responsible for all of the services requiring aviation
expertise. Some consumers feel more comfortable if all of these activities and
among them crucial services such as pilot selection and crew training,
maintenance, flight planning, dispatch and scheduling -- are overseen by a single
entity whose job is to ensure that operating, safety and consistency standards
are set at a very high level and are constantly met.
Fractional programs also have rules outlining the geographic area served.
Though there are regional programs, the major programs serve the entire United
States. Some offer extended services such as to or from areas within 200 miles
of the U.S. border or the Caribbean. Further, some programs offer reciprocal
access to programs that they operate in other regions of the world.
To avoid aircraft demand becoming misaligned with availability, Fractional
programs require more advance notice on "peak days", especially for smaller
Fractional shareholders. Specific days covered and the associated rules will be
stated in your contract.
A key selling point for Fractional programs is service consistency. While chances
are that you will rarely, if ever, fly on your own specific aircraft, you will almost
always fly on an aircraft identical to the one in which you own a share. The paint
scheme is the same, the interior is the same and the service is the same. Short
of owning your own aircraft outright, Fractional programs offer the highest level of
aircraft customization. There are, though, occasional exceptions to this
Independent Source: Deloitte Private Wealth, Private aircraft: Flying private makes sense for those with the right information (page 20)
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