August 26, 2021
Private Air Travel: Coming to You Soon?
Please read important disclosures HERE.
August 26, 2021
Please read important disclosures HERE.
As the pandemic lingers on, many travelers are seeking ways to avoid crowded airport terminals and the filtered air in aircraft cabins. Many airlines are also canceling or changing flight schedules and eliminating less profitable routes to smaller airports.1 Therefore, it is not surprising that more and more families and individuals have started traveling on private planes for the first time. No longer just for the uberwealthy, private air travel offers a variety of options for individuals who want to avoid airports and commercial airplanes. Certain modes of private airplane travel such as air charter and membership programs involve no capital investment while other options such as jet card ownership, fractional ownership in an aircraft, or whole aircraft ownership do require a capital investment.
For those considering flying private for the first time, there are a few basic things to consider — safety for starters. Private air travel is regulated at the federal level under the Federal Aviation Regulations (FARs). Only operators of planes issued a Part 135 certificate by the Federal Aviation Administration are legally allowed to charter a private flight. Part 135 is intended to hold pilots, aircraft, and operations to a higher standard than would pertain to someone providing for his or her own transportation. Operators must adhere to general safety standards including meeting operational maintenance requirements, providing evidence of aircraft accident liability insurance, and satisfying certain prerequisites for management and pilots.
Part 91 of the FARs governs general operating and flight rules for all civil and generally noncommercial aircraft in which the pilot is directly responsible for the entire private aircraft. It is similar to an automobile driver transporting others in his or her car. Under Part 91, plane inspections and other operational requirements under are often less rigorous than the standards set forth under Part 135.
What are some of the biggest differences? Under Part 91, the pilots can fly aircraft for days without ever taking a mandatory rest break. Part 135, on the other hand, has specific flight-duty-time and rest requirements. In addition, aircraft operated under Part 135 cannot generally use airports that lack on-site weather reporting.
Categories of Private Air Travel
The most common ways to fly private include chartering, membership programs, jet card ownership, fractional ownership of aircraft, and outright full ownership of an aircraft.
Air Charter: Entire Private Plane Rental
Both business and leisure travelers who want no-hassle traveling can book an on-demand air charter dependent on their schedule, departing and arriving at an airport closest to them and their destination. With this method of private aviation, one reserves a plane on an as-needed basis and pays for that flight. The cost to charter a plane varies and depends on the type of aircraft flown as well as other components related to private airplane rental. These typically include (1) billable flight time, often with a daily minimum; (2) cost of fuel, which can fluctuate similar to gas prices; (3) crew fees if layovers are required; (4) landing, handling, and incidental fees; and (5) federal excise taxes.
Travelers can work with a broker to find a charter service or book directly with the company managing the airplanes. Most operators will provide an online quote for a trip without any commitment to travel.
One of the main advantages of charter is the ability to book one-off trips rather than prepay larger amounts for membership fees or jet cards. On the downside, different charter companies have different quality fleets (some may include older planes), varying levels of service, and potentially limited availability of aircraft from which to choose.
Air Charter: Booking a Single Seat on a Private Plane
Some charter companies also sell individual seats on a private plane instead of requiring that the traveler book the entire plane. Numerous flight schedules are available weekly on designated routes and one can purchase seats on existing scheduled flights. For example, in the Bay Area, Surf Air flies to smaller regional airports with no lines or crowds and allows a customer to reserve a seat on daily scheduled shared-private flights across the West Coast, Texas, and the South. Surf Air also offers different membership programs ranging from unlimited access to an all-day flight schedule with no extra charges to membership programs that allow members to purchase discounted seats.
Other companies such as VistaJet, Magellan, or Wheels Up offer membership programs in which travelers pay an initiation fee that grants access to a variety of aircraft on a pay-as-you- fly basis at a set hourly rate. Memberships typically last 12 months with no limits on how often one can fly. In certain programs, operators offer guaranteed availability within certain notice times, fixed hourly rates, flexibility on the type of plane given the profile of the trip, handpicked pilots and crew members, and customized amenities on board. Membership takes the risk and uncertainty out of the variable pricing of charter services. In these types of membership programs, the traveler rents the entire plane for the travel.
Jet Card Ownership
Another option is known as jet card ownership. Jet card ownership guarantees the card holder a significant level of aircraft availability. Some programs are aircraft specific while other programs enable holders to use different aircraft at agreed upon hourly rates. Jet card ownership may require a block purchase of flight hours at the initial signing of a contract, with hourly rates and scheduling parameters guaranteed, and usually does not involve a long-term commitment since a block of hours is purchased up front. Some jet card programs work like a prepaid debit card wherein funds are deposited as a credit and then the cost of each flight is deducted from the balance based on the aircraft flown and flight length.
With fractional or partial ownership in an airplane, the individual owns a “portion” of an aircraft and has a share of the plane’s total annual flight hours. The number of hours an owner can use the plane is based on the size of the share purchased. Generally, this option works best for travelers who fly frequently. Companies, like NetJets or Flexjet, that offer fractional ownership handle all of the airplane’s maintenance and operations, provide experienced pilots, and handle reservations and all other aspects of a traveler’s needs. However, the fractional owners share in the financial responsibility of owning the plane, including additional monthly costs for management, insurance, and maintenance
Typically, a purchaser must sign a multiyear contract and understand the rules regarding exiting the contract or what it takes for someone else to purchase the owner’s shares. If travel dates are unavailable (that time having been already booked by another owner), one may need to fly on an older aircraft. The larger fractional ownership programs maintain fleets with different size planes, which may offer the ability to upgrade or downgrade to a jet that best suits one’s needs if one’s own plane is unavailable. Depending on the terms of the contract, an owner may incur fuel surcharges as well as a charge for each hour flown.
Whole Aircraft Ownership or Lease
Some individuals or businesses may choose to purchase or lease their own aircraft, especially if they travel a lot and want unlimited access and availability. Aircraft operations can be managed by an in-house flight department or outsourced to an aircraft management team. Depending on the size of the plane, some owners may use their plane for longer flights but use a membership or jet card for access to a lighter plane when the travel involves flying a short distance.
Aircraft Availability and Geographic Access
When evaluating different private air travel options and programs, it is important to understand all terms of the agreements. A good relationship manager at a reputable company will help one understand the best aircraft or aircraft category to meet one’s needs based on the number of hours likely required and one’s overall comfort level with flying private. A good understanding of the program benefits and fees is crucial.
Access to airplanes is a major component in evaluating private aircraft companies. Some providers own a fleet of their own on which the traveler will fly but other companies fulfill their clients’ requests by using third-party charter companies when their own planes are unavailable. Travelers who have purchased fractional ownership shares or membership services may find that their flight requests are given lower priority than owners with larger fractional shares or priority memberships.
Some companies have limitations on which regions or airports they will serve and may only have aircraft available for short flights while other companies can service a wide variety of destinations. A traveler will want to make certain that their first choice on takeoff and landing airports is available from their provider.
Choosing What Is Right for You
To choose the best option, one should consider the following:
The private air travel experience can offer travelers greater convenience, privacy, and flexibility. Saving time is compounded by arriving minutes before a scheduled departure and often arriving closer to one’s destination, reducing ground transportation time. Fliers often experience a higher quality of service that may be unavailable on commercial airlines as well as have access to additional amenities and a healthier controlled environment. Cost is certainly a factor and how much one pays depends on the length of the flight, size of the plane, and number of passengers.
Several websites provide detailed information and options on private aviation. If you are interested in learning more, we encourage you to check out the websites provided in footnotes 2 and 3 below.
1 Scott McCartney, “They got great deals on airfare. Then came the flights changes,” The Wall Street Journal, July 28, 2021, https://www.wsj.com/articles/they-got-great-deals-on-airfare-then-came-the-flight-changes-11627477200
2 SherpaReport, www.sherpareport.com