Private jet ownership is a dream which few but the most wealthy individuals are able to achieve. For those who can, however, the choice of ownership options available has never before been so broad or so well structured.

As a virtual family office, we are able to assist our clients with regards to ownership of their business jet, whether it is needed for family, business or leisure. This quick guide is intended to provide an outline of the various ownership options available on the market today.

Traditional outright ownership

Traditional full time ownership of a jet offers the most convenience, by far, of any option available to a would-be jet owner. Because the client owns the jet outright, they are able to schedule a flight at almost any time of day (NB – most small airports operate restricted hours), to whichever destination they would like. Naturally, this avenue of ownership incurs by far the most cost. It will come as no real surprise that jets are an expensive asset to acquire.

On top of this initial cost, a business jet will cost money each day for maintenance and repairs, fuelling, hangar fees, and keeping pilots and other staff on standby. In addition, any client looking to actually make use of their business jet will also have to manage FBO (fixed-base operator) costs, which are the charges levied at private airports and terminals, purchase fuel and arrange for transport connections to/from the aircraft. A client’s family office, household staff or virtual family office is ordinarily be able to assist with these aspects of aircraft management.

As such, owning a business jet outright is only typically worth the expense for those who fly more than 300 hours per year. For clients who fly fewer hours per year, or would rather avoid the expense, there are a number of alternatives available. These alternatives work on a ‘sliding scale’, which run from full ownership to members’ clubs which offer shared charter jets.

Fractional Jet Ownership & ‘Jet Cards’

Fractional jet ownership is a similar idea to a timeshare on a chalet or holiday home. While timeshares are perhaps not something one tends to associate with the ultra-wealthy, a client may buy into a scheme whereby they essentially pay a small fraction of the cost of a jet, for a relatively small fraction of use. They will directly own a share of the jet, in the same way that one might ‘own’ part of a timeshare property.

Jet cards are a similar concept, only instead of the client paying for a share of the aircraft, they pay a flat fee in return for a number of hours’ use of a charter aircraft. This has the benefit of entitling the client to access to hours on a ‘fleet’ of aircraft, with the added bonus of lower-cost repositioning flights to bring the nearest appropriate aircraft to the client’s intended departure point.

The client is able to charter an aircraft at just a few hours’ notice, and the provider offers a fleet from which an aircraft will be available at all times. This is the case for providers such as NetJets, the oldest and most well established provider of jet cards.

Fractional jet ownership and jet cards are suitable for heavier charter users, who need to travel anywhere between 50-300/400 hours per year, according to the size of the ‘share’ paid for. That being said, clients at the higher end of that spectrum could perhaps benefit from outright ownership.

Charter On-Demand

Charter on-demand is the service of choice for clients who fly less frequently; for anybody who flies less than 25 hours per year, and for whom chartered flights are less of a business or family necessity and perhaps more of a luxury. Rather than buying into the ownership of a business jet, clients can fly as and when they want, and pay only for fuel and service (or on an hourly basis).

There are many operators providing this form of ‘pay as you go’ charter flight service. Travellers can pay either an hourly cost, or a one-way or return cost in a way similar to ordinary flights. This is an excellent way of enjoying the flexibility and experience of owning a business jet, but at a fraction of the cost, and with management taken care of by an entirely separate organisation to one’s family office or household.

Private Jet Service Clubs

The final option available to clients interested in business jets is to pay for membership of exclusive private jet service clubs, which are the equivalent of a full phone contract in comparison to a ‘pay as you go’ deal. Delta Private Jets, for instance, are essentially a membership program through which clients can access a fleet of charter aircraft, which can be used as frequently or otherwise as necessary.

In return for this service, clients pay a yearly or monthly fee, depending on the amount of travel they might require. JetSmarter and SurfAir are two recent entrants to the market in the UK, which offer memberships from as little as $15,000 per year. Through SurfAir, for example, clients are offered unlimited flights for a monthly fee, a concierge service from the terminal, and the ability to book flights through a smartphone app. These have proved to be particularly popular with clients whose children are boarding overseas or are making their first forays into unsupervised international travel between family-owned properties and yachts.

Which choice is right for you?

The final choice, of course, rests with the client, and should be made with regards to three key points: how much flexibility of travel arrangements is required, how much cost they are willing to incur, and how many hours per year will be spent in flight. While outright ownership can bring the per-hour flying cost right down, it does mean that the client is restricted to the use of their own aircraft (which can entail significant repositioning costs if being shared between family members), and may find themselves chartering larger aircraft for long-distance or larger-group travel.

If the client requires nothing more than flying whenever they would like, to whichever destination they would like, there is no more flexible choice than outright ownership. The alternatives, however, offer increasingly-sophisticated management models, access to newer aircraft than before, lower-cost repositioning and faster turnaround times, with availability for last-minute travel and all of the flexibility of privately-owned aircraft and much more modest price points.

Fortunately, there has never been more choice or more competition in the private aviation industry, which is opening up the wonders of private aviation to an ever-increasing customer base.