Business case for private jets

The idea of travelling by private jet can ring up dollar signs, but there are savings to made, especially in the use of a busy executive’s time

In a recent letter to a newspaper, a businessman described his run-of-the-mill small talk with a client at the close of a meeting: “So what time’s your flight?” he asked. The response, “Whatever time I get to the airport”, made it quite clear who was in control.

Indeed, more than 50 years after the first Learjets were sold in the early-1960s, private aviation still enjoys undeniable status. Perhaps it’s the exclusivity; passengers take off when they like, from wherever they like and bring with them as many pets and bottles of shampoo – never mind champagne – as they please. There isn’t a resealable see-through plastic bag in sight.

And the lack of the usual rigmarole which accompanies standard commercial flights means that, especially in Europe, a private jet can easily drop off and pick up its well-heeled cargo in three separate global cities within a single day, if it should be required to do so. Of course, this kind of service doesn’t come cheap, but then again, time is money.

That might sound like a trite thing to say but, for a number of businesspeople, private aviation is an attractive investment and an increasingly regular fixture in their professional lives.

It was a revelation – you walk on to the plane, no one asks about creams and gels, you just get on, then get off at the other end

Manchester-based events and party planner Liz Taylor (main image), whose Hollywood namesake was no stranger to travelling in style, first flew privately a couple of decades ago, but began to do so more often after recognising the business benefits on a trip to Venice.

“I did a wedding about seven years ago in Venice and the client had a private jet, so we were able to do the food tastings and the site visits in a single day,” she says. “It was a revelation – you walk on to the plane, no one asks about creams and gels, you just get on, then get off at the other end. You’re straight on a water taxi and on the way to do the tasting in the most spectacular city in the world. Then, at three o’clock, the client might say, ‘Right we’ve done the tasting, now I’ve got a meeting.’ And so you get back on the plane and go home.”

Private Jet Statistics

Ms Taylor’s business, the Taylor Lynn Corporation, has a starry list of clients thanks to close associations with Manchester United and Coronation Street. She also recently planned a charity dinner hosted by the Duke and Duchess of Cambridge at Kensington Palace, and other clients include Take That members Gary Barlow and Howard Donald.

She explains that her experience of the industry has taught her some private-jet passengers are more equal than others. “The likes of Robbie Williams and Gary Barlow aren’t going to wait in airport lounges, whether they’re private ones or not,” she says. As a result, some people expect to be driven directly to and from the tarmac. Again, this comes at a cost, but there are less financially demanding ways of enjoying the convenience and time-savings of private air travel.

Although a second-hand 1977 model can reportedly be picked up for as little as $295,000, the price of purchasing a top-of-the-range craft can soar up to $80 million, according to the private jet charter company Sky Service. Then there are the added costs of storing, staffing and refuelling, as well as ongoing maintenance costs which, Sky Service says, tend to amount to about 15 per cent of the purchase price a year.

As a result, organisations that aim to give customers more bang for their private-aviation buck are in bullish form. Ms Taylor says she has worked with NetJets, the Warren Buffet-backed business that allows customers to buy a certain number of hours’ flying time in a year. The fractional ownership model effectively sees customers share an aircraft with several other people, paying another fee on top to cover the pilot and other services. In 2012, the company made a record $9.6-billion order for new planes and, last year, received approval to launch aircraft charter services in China.

On occasions, private air travel has enabled her to get a week’s worth of work done inside 48 hours.

“As lavish and ostentatious as they might be perceived to be, the bottom line is that it’s actually a great time-saver,” says Ms Taylor, adding that the ability to work efficiently is an extra benefit. But a journey can also act as a way of carving out some quiet time for busy people to sit down together and talk, and have those discussions and meetings that normal working life sometimes pushes to the margins. “It was very chilled and very productive,” she says of a journey she made with a client who did so much international travel that time on board a private jet was the only real opportunity for a meeting. “That’s why it works.”

The ability to have meetings, combined with the flexibility of take-off times, means Ms Taylor estimates that, on occasions, private air travel has enabled her to get a week’s worth of work done inside 48 hours. “That said, it is difficult to work out [just how cost-effective it can be].  It’s not as simple as saying, ‘If I have access to a private plane, then it’s going to save me half a million pounds.’ But it can work out very well,” she says.

Another way of travelling by private jet, which has the potential to be even more cost effective than fractional ownership schemes, is to use online booking platforms that allow passengers to fill up what would otherwise have been “empty legs”. Much of a private aircraft’s time is spent repositioning, usually either so it can pick up its owner or a client from their chosen location, or in order to be stored in a hangar. In fact, it’s estimated that each month 3,000 private jets make 40,000 flights with only crew on board.

By booking through companies, such as Victor, PrivateFly or Jet Partners (which has been described as “the Airbnb of private aviation”), customers are able to fill up these empty legs and enjoy some of the benefits of private air travel for less; often less than a first-class or business-class birth on a standard scheduled flight. At £171 per person to fly to Cannes, PrivateFly has even offered a trip to the south of France for less than the comparable easyJet flight.

However, as with many cut-price options, there is a catch. Booking this way usually saddles the customer with the cost of all the seats on the plane. So those cheaper rates only materialise if you can fill all or most of them and if fellow passengers are willing to pay their way. Also, there’s no guarantee that a similar flight will be on hand for the return leg of the journey.

Ms Taylor says that, for her, the chief business benefits of private aviation remain flexibility and the capacity to save time. But she does admit glamour can play a part too. “People do get very excited,” she says. And that can work in a salesperson’s favour if discussions about budgets or commissions for extra work are being bandied around. “Being 34,000 feet up with a glass of champagne, well, it doesn’t hurt.”