As business travel becomes increasingly necessary in our economy, businesses would be wise to consider how a private aircraft can benefit their brand. Access to private aircraft offers undeniable advantages in terms of productivity and efficiency. However, your ability to avoid mistakes throughout the acquisition process will ultimately determine your return on investment.
The details in acquiring a private jet can be very complicated and time-consuming, and mistakes along the way can derail your budget for months. A private jet is a huge investment and you want to make sure you are ready for everything that comes with owning or leasing a private jet - so before you make an appointment with a private jet broker, you and your partners should ask yourselves these questions first.
Defining Your Mission Profile
Before you ever meet with any aircraft broker or financing partner, it’s important to take the time to define your mission profile. How often will you fly? Where will you be traveling? How long will you stay? How many people will be traveling with you? How much luggage will I need to transport? What onboard amenities will my passengers need? How many hours do you plan to spend in the air each year?
The answers to these questions will help you decide what private aviation solution to pursue, as well as provide you with a solid foundation of basic needs to choose the proper aircraft.
Questions for an Aircraft Broker
When you start looking for someone to assist you in your aircraft acquisition, it’s very important to have a clear understanding of who you are working with – who pays your fee? A lot of advisors and brokers get paid only when the deal closes, but it is important to recognize where their loyalties lie. Whereas a reputable broker or advisor would let you know if there was a conflict of interest (he or she is offering you a jet that they are also getting a commission on from the seller), it is still important to ask. In purchasing a private jet, it is critical that you purchase something that fits your needs as outlined in your mission profile. Putting all of that information on the table up front allows you to know whether your financing partner has your best interests at heart.
Many brokers or advisors only focus on one particular aircraft or one specific ownership financing option so it is important to figure out what that is and does that work for you. This narrow platform is only an issue when you are unsure of what you would like purchase and would like to see and feel several jet options and availability. While a minor problem, if one at all, this is still something to consider if you would be uncomfortable switching advisors/brokers half way throughout the process.
The best testament is a happy customer. Ask your broker for references and be sure to contact them. Unfortunately, many first-time buyers fail to ask this question and simply use someone that they’ve heard of or that a friend has referred. While referrals are fine, specific questions are better. How many transactions of this specific category of aircraft have you overseen? How many transactions have you had? Buyers should make brokers produce evidence that coincides with their level or work – the good, the bad, the ugly – you should see all of that before signing the dotted line.
You should never purchase or lease an aircraft without having an exit strategy in mind. Aircraft are extremely vulnerable to market fluctuations thanks in part to manufacturers releasing new models every few years. Your advisor should have a good handle on past resale values for a variety of jets, giving you an idea of how much you can expect in the secondary market when it comes time to sell or end your leasing arrangement.
You wouldn’t buy a new home or car without getting a proper inspection first, and the same standard should be followed when looking to acquire a private aircraft. A quality broker should be present at all pre-purchase inspections, helping you pinpoint areas of damage and to make sure the aircraft is inspected top to bottom.
Upon the completion of the inspection, it is imperative that you determine whether or not they can help you find someone to manage the aircraft. Making a bad decision in who manages the jet can cost you, down the line, more than the jet itself. It is so important that you find a management company that works with you - meets your needs and fits within your financial budget. Whereas, some prefer larger companies with all of the “perks” and “rewards”, others prefer a more intimate relationship. Either route is up to you, it is just important that you know whether or not your broker is able to steer you into the right relationship or not.
While owning a private jet comes with a substantial amount of benefits, it is important to determine if it is a valuable asset and if so, how you intend to use it.
There are quite a few buyers who charter their private jets out to other users to offset the purchasing cost; however, doing so limits how often and when the owner is able to fly their jet. You should also consider: what are you willing to pay for? What premium options are worth the premium price and which ones are not? Keeping this in the forefront of your mind will allow you to stay focused and adhere to your budget. It is very important that you separate needs from wants. Considering a pre-owned jet instead of a brand new one could save you about fifty percent on the price of the jet.
The most important thing to remember is that you’re not on this purchasing journey alone. Work with a team that understands the industry like no other by getting in touch with Global Jet Capital. Our team has served the private aviation industry for a combined 200-plus years, overseeing over 3,500 private aircraft transactions in that time. We put that expertise, industry relationships and knowledge to work on every transaction we oversee, offering our clients a variety of flexible financing solutions tailored to their needs. Stop worrying about costly mistakes when acquiring a new aircraft, work with a team of experts you can trust and contact Global Jet Capital today.