Fractional Ownership booming

In the last decade of 20th century, the economic boom in the US has fueled a rise in fractional ownership companies, which in turn has provided a serious boost to corporate jet manufacturers. Fractional ownership of aircraft allows corporations and individuals to own a "share" of a plane, which entitles them to a set number of hours of flying time, based on the size of the share. The share is a real asset and can depreciate over time. As a rule of thumb, a plane is flown approximately 800 hours per year, so a quarter share of a plane is worth 200 hours of flying per year.

One of the significant advantages of fractional ownership versus charter flights is that the fractional ownership model is based on a series of one-way flights. For example, if there is a meeting in New York, the aircraft would take its passengers there and leave them, picking up passengers for another owner and taking them somewhere else. If you want to go on to a further destination, another aircraft would do the job, and assess the hours accordingly. Compare that to charter flights, which always charge for round trips, even if the return journey is not required, since the aircraft must return to its home base.

More important for Latin American business travelers is the concept of "primary coverage area," which basically means the areas where passengers are free to travel one-way in any direction. For most companies, this usually means the United States. If one needs to travel in Latin America it becomes more complicated, and fractional begins to operate more like a charter service. That is now changing.

Many firms are pushing the boundaries of their primary coverage area. Until now Latin American corporate business travelers could take advantage of fractional ownership only after arriving in the US. Responding to the opportunity, Flight Options one of the major fractional ownership companies today serves about half of Mexico, and is working to extend coverage nationwide.

Customers tend to use their savings to purchase a share in a bigger, more comfortable pre-owned aircraft than one they might have been able to afford new. And the choices for private business jets have never been better. The difference is usually measured in cabin size, speed and autonomy; as a rule of thumb, the bigger, faster and longer a jet can fly, the more expensive it becomes.

The more recent years offer even more choices. New models have positioned themselves between large business jets like the GV or Challenger and mid-size jets like the Lear 60. Fractional owners will be able to sample the options, as all the companies allow you to exchange hours between planes. For many in Latin America, the benefits of flying in a private corporate jet are numerous. The first is the freedom of determining departure times and itinerary, allowing for multiple visits to different cities in one day or the ability to hop from place to place without worrying about connections. A private jet also means no delays, no lost luggage and no air rage.