Have You Considered Aircraft Charter?

If your company has diverse travel needs but not enough regular journeys for a dedicated business aircraft, charter may be the best choice

David Wyndham  |  20th March 2015
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David Wyndham
David Wyndham

David Wyndham is executive sales director & acquisition specialist with Par Avion Ltd. Based in Sebastian,...

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A recent client presented a very interesting challenge. About 40 percent of their private air travel is less than 200 miles, much of it to short runways at airports that are conveniently located to their plants. Another 40 percent or so is in the 800 to 1,500 mile range to visit regional offices.

The typical passenger load on these trips is three to five persons with minimal baggage, and the short trips are always out and back in the same day. The last 20 percent of their travel is long-range (in excess of 2,000 miles) and although loaded with only five or six passengers, there is considerable baggage on those trips. No one aircraft seemed a best fit for all the company’s travel needs.

Any aircraft that could fly the long-range trip could easily handle the intermediate range travel, but finding a long-range alternative capable of the short-range trip was not practical.

There were several aircraft models that, lightly loaded for the 200 mile trip, could land and take-off from a few of the shorter runways, but most short-range missions with a long-range aircraft would require operating from larger airports more distant from the desired destination. Furthermore, the acquisition prices of the long-range alternatives were $18-25 million and their operating costs were relatively high.

There were aircraft capable of the intermediate range trips that could also do the short hops. Their acquisition prices were $7-9 million, and their operating costs were lower than the long-range jets. But they would require a fuel stop on the long-range trip, and the passenger cabin (even with only five persons aboard) was too small to accommodate people and baggage appropriately.

For about $3-4 million, a turboprop airplane was very cost effective on the short trips and could easily handle the shortest of the runways at the company’s intended destinations. But the slower speeds of the turboprop made the intermediate trips longer than the client wanted. Furthermore, due to its faster speed, the business jet’s cost per trip was actually very close to the trip cost of the turboprop.

With the company’s total utilization and mission profiles, acquiring more than one aircraft was not cost effective.

Examining Options

One recommendation was acquiring a light jet for the short- and intermediate-range trips and added supplemental charter for the longer trips. Full aircraft ownership for any mission, however, wasn't cost effective when the company’s frequency of specific needs was analyzed. Thus a second option was chartering three different aircraft that were optimized for each trip.

Upon analysis, the client was ideally suited for the all-charter option to address differing trip lengths and baggage requirements. The company had experience chartering various aircraft and had identified several preferred charter operators to provide lift. One offered the light-twin turboprop needed for the short trips. Two other charter companies operated jet aircraft suitable for the longer-range missions. Charter fit all the company needs well.

Charter is a flexible option for company travel. My client was able to pick the right aircraft for each mission. If they end up flying more frequently than they do now, ownership might make sense for them in the future, possibly with a light jet for the short- and intermediate-range trips and adding supplemental charter for the longer trips. But for now, the client needed the option of low utilization and high flexibility that charter provides.

Charter as Supplemental Lift

This type of flexibility works even for those who own their own aircraft. A chartered aircraft can be the second aircraft when needed, since acquiring another aircraft for a slight increase in utilization does not make fiscal sense. Charter also serves as a means of evaluating the need for new or additional aircraft.

Include Jet Card memberships as part of your assessment of the charter option. Cards offer flexibility since card holders pay only for the flights flown and competitive rates can be customized to meet the holder’s needs.

Do you fly on non-peak days and need a lot of one-way trips? Or fly only between major metropolitan city-pairs? There may be a charter plan and a business aircraft just right for you.

Read More About: Leadership | Operating Costs | Business jet ownership | Charter


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