Oftentimes, private jet owners are faced with unknown operating expenses and stressful day-to-day operations. This may lead to the decision of contracting a private jet management company to take care of the logistics and bring in passive revenue from their aircraft.
What is a Jet Management Company?
Private jet management companies assist aircraft owners by providing services like dispatching, aircraft hangaring, and chartering for jet owners who would like passive income when they are not utilizing their aircraft.
There are many aircraft management companies available to jet owners, but choosing the best fit involves research of cost, location, and safety.
Pros and Cons of Jet Management
- Maintenance provided
- Discounted fuel cost
- Passive revenue from chartering
- Private terminals
- 24/7 operations
- High cost of services
- Must book your own aircraft to travel and may interfere with charter operations
- Weather delays a higher risk because of the smaller size of aircraft
- Possible baggage restrictions
What Are the Costs Related to Jet Management?
Costs associated with jet management are on a tiered basis depending on the level of management needed. Costs can range from $5,000 to $15,000 per month depending on what level of jet management you want.
- Full Managed Solution: A fully managed solution offering a fully staffed operation, maintenance, and flight crew for use 24/7. This tier is the most expensive and will likely cost more than $15,000 per month.
- Charter Managed Solution: A revenue-targeted jet management solution that is aimed to provide you with the resources needed to chart your aircraft when you are not using it to create passive income. This aircraft management solution can be billed two ways: on a monthly basis or on a commission based plan, equating to around $7,000 to $10,000 per month.
- Personalized Solution: A jet management solution aimed to provide the jet owner with an aviation specialist for scheduling, dispatching, and maintenance needs. This is a private jet management solution that does not require chartering and costs around $5,000 a month.
Questions to Ask Before Committing
Because there are so many private aircraft management companies available, it is important to ask questions to find the best fit. Here is what you should ask before committing.
What safety management system does your company utilize? Can I see it?
All aircraft management companies must meet FAA safety regulations to be licensed jet management companies. Beyond the minimum requirements, find out if there are any additional safety precautions put forth by the management company. Additional training requirements and operational safety standards above the FAA regulatory minimum ensures the jet management company is dedicated to the safety of you, your aircraft, and their employees.
Also, ask to see their safety standards to evaluate if they meet your standards.
What does the cost reporting look like? Is it transparent?
Owning a private jet is not a low-cost venture and hiring a private jet management company adds to the expense. A reliable and honest company will have a transparent reporting platform. The reporting platform will show maintenance costs, charting revenue and costs, and miscellaneous costs such as hangar fees, fuel, and flight crew expenses. This will ensure no markups or third-party invoices are sent to you, the owner.
If the private jet management company is honest and upfront about all costs associated with your aircraft, they may be a good option to manage your aircraft.
Are there operation discounts available for owners?
Some jet management companies provide incentives to aircraft owners. Perks such as discounts on fuel, low-cost, but high quality maintenance, and training for flight crew may be offered. The management company may also host a private terminal which can significantly decrease the time needed at the airport prior to departure.
For aircraft owners who do not have a flight crew, the private jet management company may provide one. Most of the time, the crew will be available 24/7 for use by the owner.
How frequently will my jet be chartered?
Jet management companies may provide chartering services to offset the costs of owning and operating a private aircraft. Sometimes, chartering can be an unreliable means for revenue owing to fuel costs, weather, and other factors.
Finding a jet management company that can guarantee flight revenue monthly can ensure chartering is being used to the fullest extent. If chartering is the main reason for hiring a jet management company, ensure terms are agreed upon and added to the contract.
Enjoy Aircraft Maintenance With a Jet Management Company
Jet owners may face unexpected costs and logistic issues after investing in a private jet. A private jet management company can provide benefits for aircraft owners to take advantage of chartering, storage, and maintenance of their aircraft, all while earning passive revenue and providing incentives.