Is fractional jet ownership the right choice for your lifestyle? Learn more about what fractional ownership really entails in this private jet guide.
Should You Consider Fractional Jet Ownership?
Fractional jet ownership offers partial ownership of a private jet for frequent flyers, but it comes with high upfront and ongoing costs. For most travelers flying under 50 hours a year, on-demand chartering offers more flexibility, variety, and better value.
- Fractional jet ownership provides a share of a jet and guaranteed flight hours.
- It requires a large upfront investment and monthly management fees.
- Costs vary based on aircraft size, share percentage, and usage.
- It’s only cost-effective for high-frequency flyers.
- Chartering is often more flexible, affordable, and offers broader aircraft options.
- Paramount Business Jets offers pay-as-you-go charter with no long-term contracts.
Many high-net-worth individuals dream of one day owning a private jet. But most of those individuals don’t dream of the maintenance, paperwork, and ongoing costs associated with jet ownership. Chartering a private jet can help solve some of those problems.
Those who fly more frequently might consider a third option: fractional jet ownership.
As a fractional jet owner, you essentially own a share of a private jet. This model offers many of the benefits of full ownership, including enhanced flexibility and customization. However, fractional jet owners avoid the burden of paying high upfront costs. Likewise, they are not responsible for many of the ongoing expenses and responsibilities of owning a whole aircraft.
For many VIP travelers, fractional jet ownership represents a level of freedom that full ownership can’t provide. In this guide, we’ll explore the basics of fractional jet ownership. Continue reading to discover the best fractional jet ownership arrangement for your lifestyle.
Why Choose Fractional Jet Ownership?
The first fractional jet ownership company to emerge was NetJets. This organization was formed because while the convenience and flexibility of owning an aircraft made sense, the finances did not.
Indeed, owning an aircraft is very expensive. Firstly, there is the multi-million dollar cost of purchasing a jet. Additionally, the ongoing fees associated with jet ownership continue to accumulate.
Some of the many expenses related to jet ownership include:
- Crew and maintenance staff salaries
- Hangar costs
- Maintenance bills
- Inspection fees and repairs
- Jet fuel
Altogether, these expenses make for a very costly option.
NetJets was created to give VIP travelers the option to pay many of these costs on an annual basis. For many individuals, this model is more affordable and attractive than long-term aircraft ownership.
However, many private jet charter customers have found that chartering aircraft is actually more convenient and more cost-effective over time.
How Does Fractional Jet Ownership Work?
As a NetJets client, you have the opportunity to buy a share of an actual, existing aircraft. You can start out with 1/16th of an aircraft and work your way up from there. NetJets requires an initial 5-year commitment to start. However, you aren’t limited to five years of fractional ownership.
After paying an upfront fee, you will officially own a portion of an aircraft. This share entitles you to a set number of flight hours per year. Depending on your usage and location, there may be potential tax deductions for business use.
However, you will probably never see or fly on the specific aircraft you “own.” You will be flying on an aircraft of the same or similar make in the same class. Fractional owners are guaranteed an aircraft upon giving notice approximately 10 hours in advance.
The flight crew and aircraft will be high-quality and will provide great, reliable customer service.
How Much Does Fractional Jet Ownership Cost?
The first expense associated with fractional jet ownership is purchasing your share of the aircraft. A 1/16th ownership is common. It entitles you to about 50 flight hours annually.
For a midsize jet, a 1/16 share might cost $550,000 to $750,000 upfront. This is not refundable. You will need to resell your share when the contract ends.
There is also a monthly fee that covers maintenance and crew costs. Expect to pay between $8,000 and $15,000 per month, depending on aircraft size.
Finally, you'll pay a per-hour fee when you fly. Hourly rates vary. Because they include fuel costs, larger planes typically have higher hourly rates.
Other potential costs associated with fractional jet ownership may include:
- Fuel surcharges
- Repositioning fees
- Aircraft upgrades/downgrades
- Peak day surcharges during holidays or high-demand periods
Actual costs will depend on factors such as your chosen aircraft, share size, fuel price fluctuations, and more.
Is Fractional Jet Ownership Worth It?
Ultimately, fractional jet ownership is only worth it for high-frequency flyers who value consistency. For those flying under 50 hours annually, chartering is far more economical because it allows you to fly when and where you wish without the capital commitment or long-term contracts.
You should consider chartering instead of fractional jet ownership if:
- You fly less than 50 hours per year
- You need flexibility without long-term contracts
- You want access to a wider variety of aircraft
- You want to avoid capital risk and depreciation
- You want lower all-in costs
Ultimately, whether or not fractional jet ownership is worth it is a personal decision. We’ll discuss why chartering is a worthwhile alternative below.
The Benefits of Private Jet Charter
Those who choose fractional jet ownership are responsible for ongoing fees, whether they fly or not. In contrast, private charter flyers who come to Paramount Business Jets only pay the cost of a trip on a pay-as-you-go basis.
Operators compete for Paramount’s business on a per-trip basis, allowing us to pass along highly competitive rates to our clients. This on-demand private jet charter model is significantly more cost-effective than fractional ownership.
Travelers will also be able to make savings on one-way and empty leg flights when they apply. They’ll gain access to solutions for all trips, no matter what the need. The aircraft are reviewed and selected per the client’s needs and desires.
Whether on a budget or looking to fly in the highest luxury, you will have thousands of aircraft to choose from. Every operator we work with must provide the utmost professional and high-quality flying experience. After all, they don’t have you (or us!) locked in for the next 5 years.
Final Considerations
Fractional jet ownership was created for customers who are really keen on buying their own jet. If you speak to jet charter customers, you will find that many of them have owned jets before.
In the end, booking a jet on a trip-by-trip basis is a more financially practical option for most situations. You will receive the same sort of outstanding customer service and aircraft availability. The difference is that you’ll see significant savings and a wider offer.
Own the skies, on your terms. Explore our Jet Card Membership today with on-demand charter flights at Paramount Business Jets.
