Fractional Aircraft Ownership
Fractional aircraft ownership (also known as fractional jet ownership) involves purchasing a percentage of a private aircraft owned by a private jet carrier. This is a popular way to enjoy the convenience of private jets without investing millions of dollars to own one.
Fractional jet ownership was started by NetJets in 1986. Today there are many companies who now offer aircraft fractional ownership, but each company’s contract is different and has diverse specifications on how and when the owner can operate the plane.
Some companies allow fractional jet owners to change the plane based on the needs of the owners, but most companies lock owners into one type of aircraft. If this is the case, it is very important to consider your current needs as well as your future endeavors when selecting an aircraft.
The system behind fractional jet ownership is quite simple. Owners buy a portion of a private jet and the amount they own is directly proportionate to the amount of use. An owner who owns 1/8 of a plane may get to use the plane for 100 hours a year annually, while the person who owns 1/16 of the plane may only get to use it for 50 hours a year annually. A few fractional jet companies allow owners to sell portions of the percentage they own.
That is, the person who owns 1/4 of the aircraft can sell a portion of the quarter he or she owns to other investors. However, this is not typical and most fractional jet owners are locked into the contract they signed. If an owner wants to leave the contract and sell the percentage he or she owns back to the provider, they will have to face residual value.
Meaning the aircraft has lost value due to age or other factors and is no longer worth what it was originally purchased. Aircraft fractional ownership is an excellent idea for those who enjoy luxury air travel at a price that is affordable. Fractional ownership allows members to travel as they see fit whenever they need to travel without the stresses of commercial airplanes. No more delayed flights, no more rude flight attendants, no more hassle.