Runway Guide: Private Jet Fractional Ownership vs. Leasing
March 21, 2022
The costs and dynamics centered around private jet ownership can seem to be a torrent of information. At Flexjet, we have a passion for educating on this nuanced and detail-driven topic. But it’s important to keep in mind that it’s all built around your desired flexibility, level of jet access and preferred payment structure.
Before you embark on your aircraft ownership journey, it’s also important to identify exactly who YOU are as a prospective owner. Taste, preferences and level of control are all things to consider when anticipating your needs in this space.
For more informed decisioning, we have highlighted some key differences between fractional ownership and private jet leasing. We are committed to providing insights and expertise that help you select the ownership model that suits you best.
What is Fractional Jet ownership?
Simply put, fractional ownership is the experience of whole aircraft ownership without the hassles of crewing, maintenance and unforeseen operational costs or downtime. It might be helpful to think of fractional jet ownership as a timeshare or private jet membership. With Flexjet, this level offers maximum flexibility and control over your travel ambitions. Owners in the fractional space enjoy an exceptional luxury experience, elevated service and immediate aircraft availability – whenever it’s time to fly.
In addition to consistency and guaranteed availability, fractional ownership allows you access to the Flexjet global fleet in addition to the exemplary safety and service culture of one of the world’s leading private aviation groups. In North America our fleet includes the Embraer Phenom 300, Praetor 500, the Bombardier Challenger 350, the Gulfstream G450 and G650. True world-class aircraft operated by world-class pilots and team members.
We offer modern, exceptionally maintained aircraft with impeccable, high-spec interiors that compliment even the most discerning of tastes.
Flexjet Fractional Ownership – Cost Breakdown
When you buy a fraction of a plane, owners are allowed a fixed amount of hours per year and charged a monthly management fee, an hourly charge for usage and an hourly fuel surcharge. The normal term of ownership for fractional shares is usually five years. Shares commence at 50 hours of flight time per year, up to 800 hours.
Fractional ownership may be best suited for those who fly over 50 hours a year on short notice. The size of the aircraft and share will be directly related to the number of hours you anticipate flying and the distance of your trips. Below are the three biggest cost components of Flexjet aircraft ownership solutions.
- Acquisition Cost: When you decide to purchase an undivided interest in a specific Flexjet private aircraft for up to a 5-year term, there are some initial payments to cover. Our fractional jet ownership program requires an upfront cost of approx. 43% of your total yearly operational budget.
- Monthly Management Fee: If you are looking for all the benefits of owning your own aircraft without the burdens of crewing and insurance, then Fractional Jet Ownership is the program for you. When purchasing a share, you will pay a Monthly Management Fee, which covers items such as pilot provisions and training, insurance, hangaring and administrative costs.
- Occupied Hourly Rate: Your Occupied Hourly Rate covers the direct costs of operating your aircraft: maintenance, engine reserves, pilot fees, catering, etc. Enjoy low hourly rates for your entire term, with access to the Primary and Extended Service Areas without ferry fees. As a Fractional Owner, you can book your travel with a 10-hour response time.
What is Private Jet Leasing?
Leasing a private jet works much of the same way that fractional ownership does, however with one key exception. Private jet leases do not require an initial capital outlay as stated above, however owners are still responsible for a standard deposit.
Those who wish to lease a private jet still pay a Monthly Management Fee and Occupied Hourly Rate in addition to a deposit and monthly lease payment that some find to be more approachable when identifying the commitment that best suits them.
However, keep in mind, with a private jet lease, schedule flexibility, call-out time and aircraft selection may be limited in spots. Otherwise, leasing a jet share affords you the benefits, travel experiences and service standards Flexjet has to offer.
To learn more about our fractional and lease programs, contact our team via the form below or call us at 866-473-0025