- 06 Mar 2023
- René Armas Maes
- Aircraft Ownership
Having established the case for joint aircraft ownership and ensuring one owner doesn’t benefit more than another, how should co-owners choose an aircraft to fulfil the requirements of two different mission profiles? René Armas Maes explores...
For this discussion, we’ll assume Owner A and Owner B have successfully co-owned a high-performance Twin-Engine Turboprop for several years and have agreed it’s time to upgrade to a Light Jet.
Their annual flight utilization is more than 200 hours (combined), and the search for a new aircraft will focus on very specific requirements that are important to each owner. Historically, both have operated their aircraft with a single pilot, and they plan to continue doing so. But this is where the similarities end...
Owner A currently has an average stage length of 1,200nm, while Owner B averages 1,700nm. However, Owner B expects to see an increase in their required stage length, and within two years of acquiring the new jet she projects 30% of her trips will require an aircraft capable of flying 2,400nm. She expresses a preference to fly those segments non-stop.
The trips exceeding 2,000nm are expected to occur four times per year, while the remaining 70% of Owner B’s travel will be more aligned with the current average stage length of 1,700nm.
Both owners are keen to extend their shared aircraft ownership venture as it has worked well for them previously. So, both parties agree to seek a suitable aircraft that meets their different mission profiles and requirements.
Owner A and Owner B plan to execute a comparative analysis of the suitable aircraft. Beyond the primary criteria such as range, seating and payload capability, there several other important criteria that the co-owners have identified, including preference for their aircraft to be factory new, and for it to offer an array of cabin comforts and amenities.
Moreover, the aircraft must fall within the $9-13m price range and meet a pre-agreed hourly operating cost.
With each owner detailing their ‘must-have’ and ‘like-to-have’ criteria for their new aircraft, they can begin a very specific aircraft search with only a few jets likely to meet the threshold of their joint requirements.
Having identified three aircraft models for the comparison, Chart B (below) details how the shortlist is narrowed down further when the details of each is matched up with the co-owners’ requirements.
In order to effectively analyze aircraft route performance, sector-specific route analyses based on a series of assumptions should be executed. This includes analyzing route performance based on maximum payload, and power setting (for example, long-range cruise speed at optimal flight level).
The use of these assumptions helps to ensure consistency across the published performance and specifications data provided by the aircraft OEMs.
Without undertaking such analysis, it will be almost impossible to get an apples-to-apples comparison of the jets on the shortlist, since the OEMs will understandably seek to paint their products in the best light.
Next, a comparison of the technical specifications of the subject aircraft is necessary, based on data provided by the OEMs as well as third-party sources such as Conklin & de Decker. At a minimum, this evaluation should include passenger capacity, cabin cross-section, luggage capacity, payload, fuel capacity, and range.
In our illustrative example, Owner A also has a need for a jet that can operate on shorter runways than Owner B and is capable of excellent hot and high performance. Therefore, other performance items like Balanced Field Length will also need to be factored.
After the initial analysis is done, it becomes easier to begin to identify the right aircraft, and it will stand out from the shortlist of candidates as the one that is able to complete the highest percentage of missions for Owner A and Owner B without significant limitations.
It can help to build a scorecard allowing the co-owners to examine all factors in the aircraft comparison exercise. For example:
Assuming both Owner A and Owner B are basing their decision on the aircraft providing the highest return on investment, the focus should be on an aircraft capable of meeting the majority of their flying needs.
In reality, an aircraft providing a 2,400nm range is likely to be a waste of money for Owner A who seldom has a need for more than 1,500nm. Thus, the owners may agree to an aircraft capable of flying 2,000nm, meeting the flying needs for 70% of Owner B’s trips.
If Owner B is willing to compromise over having a fuel stop on the longer trips, or is prepared to source supplemental lift, then some middle ground can be found that satisfies both owners.
If no such compromise can be reached, then the co-owners should re-evaluate their business case for the shared ownership agreement.
Did you miss the previous articles in this series? Catch up on them here: