In his December 2006 “Inside Fractionals” column for Business Jet Traveler, Shaircraft CEO, James Butler, discusses why fractional ownership isn’t for everyone.
Generally speaking, fractional ownership is said to be for those who fly between 50 and 400 hours per year. However, Butler cautions, “[Y]our analysis should go much deeper.”
Butler believes it pays to consider factors like the average length of your trips (if you fly a lot of short legs, one hour minimum billing will significantly increase your flying cost), travel dates (availability will be limited on peak travel dates), and the location of your home base and most frequent destinations (if you’re near major airports, there may be local charter companies that can service your needs).
Additional considerations include available aircraft models (do they work for you), your need for cost certainty (costs will vary over time), your appetite for a substantial capital outlay (can you better invest your capital), and tax advantages (will depreciation deductions be available to you). These and other factors mentioned in the article should be considered in determining whether fractional ownership is your best bet.
Butler advises, “Your goal should be to purchase maximum flight time on an aircraft that best suits your needs from a reliable, safety-oriented and financially stable company at a reasonable, if not minimum, cost. Making the wrong choice can cost you hundreds of thousands, even millions, of dollars.”
Inside Fractionals: “Who Shouldn’t Buy Fractionals”
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