What is Private Aircraft Management?
When someone buys a private jet, very rarely do they want the responsibility to do all the grunt work of maintenance, following FAA regulations, hiring flight crews, and keeping the airplane properly stored and cared for. Instead, a private jet owner wants to have a private jet ready for when they need to make a flight, and then it is an “out of sight, out of mind” situation.
This is where private jet management companies come into play. Private aircraft management services will make sure that all of the above things are taken care of, maintaining the aircraft and keeping it in peak condition, and allowing the private jet owner to go about their business–which generally has nothing to do with maintaining private aircraft.
How Does Private Jet Aircraft Management Relate to Private Jet Charter?
The owner of the private jet, except in rare circumstances, will not be using their private jet day-in-and-day-out. This will leave the private jet with a lot of downtime, time when it is merely sitting in the hangar. During this time the flight crews will still need to be on standby, the plane will still need to be maintained, and, above all, ownership costs of the private jet do not cease.
So, private aircraft management companies will, with the owner’s permission, use the private jet for air charter. This will mean that the plane is not gathering dust, but more importantly it will mean that the jet is earning charter revenue. The aircraft owners will allow flight operations to proceed with their private flight while they’re not using it, will earn a profit, and the plane will be properly maintained.
Of course, this is not the case with all private aircraft management. Some aircraft owners will choose to simply have the flight crew training with the aircraft, with aircraft maintenance taking place continually, and the plane will always be ready when the aircraft owners need it. But using your private jet for charter services will earn you money.
What Responsibilities Do the Aircraft Management Companies Take Care Of?
There is a lot to aircraft ownership, and a world-class aircraft management company will take care of all of the things that a private jet owner would need to take care of on their own. This involves:
- Making sure that the airplane is in a hangar and properly stored and protected from the weather. This also means that the private aircraft management company will deal with the airport to make the business deals for the hangar. Those negotiations will not need to be made by the aircraft owner.
- Ensuring the aircraft follows all FAA and ICAO regulations. This includes maintenance and log keeping, ensuring that the airplane will always be ready at a moment’s notice.
- Scheduling charter services. The private aircraft management companies will be responsible for working with air charters to get the plane in the air when and where it is needed. As part of these charter services, the aircraft management company will keep the plane in pristine condition so that it is always up to the standards that are required by the air charter.
- Providing accounting services for all of the airplane’s activities, maintenance, finances, and certifications.
- Maintaining the insurance on the aircraft and negotiating the insurance contract.
- Negotiating fuel, parts, and labor for the aircraft as part of regular maintenance and operations.
- Handling the work with charter services, so that the aircraft owner does not have to be involved with the day-to-day operations of the aviation services of the private jet charter.
- Doing all other things necessary to make sure that the aircraft is always running in a safe, profitable, and reliable manner.
How Much Does It Cost to Manage a Private Jet?
When everything’s taken together, including airport costs like hangar fees and fuel, operating costs, flight crews, and regular maintenance, the cost of maintaining a private jet can range from $500,000 to $1,000,000 per year.
This elucidates the reasons why it can be so beneficial to aircraft owners to offer their private jets for charter services, as an effort to recoup some of those costs. The money that can be earned by using your jet as a part-time charter can make up part of the annual operational costs of managing a private jet. The more frequently you make your jet available for charter, the more money it will make–but remember that when it’s being used for charter you can’t use it yourself.
The actual figures of how much money you can earn by using your private jet for charter services through an aircraft management company can vary widely depending on the size of the plane, as well as its primary base of operations. In general, your private jet would need to have more than forty hours of charter flight per month to break even on expenses.
For example, a midsize jet that is based out of Teterboro will have a much higher chance of earning money than a light jet based out of Sioux Falls. The money that your private jet can earn is directly proportional to how easily accessible it is and how much it can charge its passengers.
Conclusion
It is easy to see why it would be so useful to use a private jet aircraft management company if you own a private jet. And it further illustrates how profitable it can be to use your private jet as an air charter when you’re not needing it. At the very least, the money earned by minimal charter services will offset operating costs, and at best, the private jet charter can be a good business investment as an income source.