Private jet ownership
With more manufacturers entering the small aircraft market, it’s now becoming easier to own a jet rather than use charter services, but buying your first jet can be fraught with problems if you don’t know what to look for, or fail to appreciate the cost of ownership before taking delivery.
Tips before you buy
Private jet ownership is a complex business, and one that can incur many hidden costs if you don’t research it properly before you buy. If you are too keen to get your hands on a new Gulfstream or Piper M600, you ignore the potential costs which mean you could end up with some expensive bills to pay, and this can take the fun out of ownership. First off, you need to be honest with yourself about the number of hours you fly every year. If it’s fewer than 250, then buying outright might be false economy anyway. You may be better off either chartering, or owning on a shared basis – usually called ‘factual ownership’ – and putting up with the fact that you may not be able to fly on a whim. Once you add in airport landing fees, fuel costs, and maintenance and storage costs, ownership as opposed to charter or factual ownership can get expensive.
But if you simply must buy – whether you are going for new or used – then using the services of an experienced broker is always a good start. However, that too has its share of potential pitfalls. For instance, you need to understand whether the broker that you choose also acts for sellers, as there could be the possibility of a conflict of interest. So ideally you should try to find a broker that only works with buyers, in order to prevent that possibility. Brokers, like many intermediaries, generally take their fee once the deal is complete, but again, it’s worth checking before you start the buying process. But even with that professional help, there are a few things that you need to look out for to stop your dream turning into a nightmare.
While your broker will be adept at connecting you with a seller and, if you have done your homework in selecting them, will have a good knowledge of what is important when buying an aircraft, you are going to want some first class technical advice too, so that means using the services of an aviation engineer. Just as much as you will need technical assistance, you are likely to want to retain the services of a qualified aviation insurance specialist too, since this is a complex field fraught with issues that can trip up the unwary. The likelihood is that, in order to buy your first jet, you are going to want to build up a team of qualified people to advise you, so you might as well get your accountant involved as well.
Aircraft come in all shapes and sizes but are generally quite small, so if you are above average in some aspects – height, in particular – you need to research your aircraft properly or you might find that extended hours of flying can become uncomfortable. The same applies if you are going to regularly transport large or ungainly items, such as sets of golf clubs, or your favourite surfboards or hunting rifles. You need to have enough hold space for all your equipment and that of your passengers too, so be realistic as to what you are going to use the aircraft for. Plan to take more luggage than you would normally pack, as once you get your new jet you’ll find plenty of people who will want to share the experience with you. Generally, you should try to secure an aircraft that will meet your needs for at least 90% of the time and have the option of chartering a bigger plane for the remaining 10% of the time, if you need it.
Speed costs money so you need to be realistic about the length and duration of journeys that you plan to make. If you intend to routinely travel a few hundred kilometres, then spending money on a jet aircraft doesn’t make sound economic sense. If, however, you intend to regularly fly over greater distances, then the extra speed of a jet will make sense, but you will need to appreciate that you are going to be spending a lot more on aviation fuel.
Aircraft are uniquely high-performance products and need almost constant regular maintenance alongside several periodic major overhauls of engines, airframe, landing gear, bodywork and instrumentation. For pre-owned aircraft, you need to check the maintenance record to ensure your potential purchase is in tip-top condition before you buy. The good news is that, because the FAA and CAA require an aircraft to be fully serviced, if the log is up to date then you are looking at a jet that is in almost as good condition as when it first left the factory. Conversely, if it is coming up for a major overhaul and service, you could be looking at an outlay of several thousands to get it in A1 condition.
Because you have to carry out so much maintenance on your aircraft, you need to consider the availability of spares and replacement parts. If your aircraft is new on the market, or coming to the end of its production run, spares may become increasingly difficult to get hold of, and if you can’t find them or have to get them made to order by a specialist shop, then it might keep you out of the air. When you narrow down your search for a new plane, have a good look at spares availability too.
Private jet sales are soaring, and it’s pretty easy to join a growing band of elites who enjoy the freedom that comes with owning a jet. But you need to do your homework first, or you might be spending more time on the ground than you had hoped. Happy flying!!!