FLIGHT DEPT BASICS
Finding the right business airplane
Choosing an aircraft and the ownership model and operating structure can be daunting. A successful outcome depends on a measured approach to matching needs and alternatives.
Ownership structuring embodies liability protection planning, economic and cost-sharing arrangements, regulatory compliance, income tax treatment of operating expenses, depreciation, excise taxes and a host of other considerations. Although above table offers broad guidelines, this is a highly specialized area in which prospective owners are advised to seek qualified assistance.
While whole ownership affords the greatest flexibility, it is accompanied by inhouse management complexity and a need for significant specialist knowledge. Annual utilization on which an assessment is based should be forecast to continue for at least 3–5 years beyond the date of acquisition.
For most business aviation users, private jet travel is an essential tool designed to extend corporate reach, broaden commercial influence and enhance situational awareness over long distances.
The capacity of an aircraft as an enabler and accelerator of business enterprise is recognized and leveraged in direct support of commercial enterprise.
For companies not yet convinced, the opportunity cost of time is still a vague concept. For them, it must be appreciated that waves of innovation allow early movers to dominate the market and earn substantial profits. It has been said that time can never be saved—it can only be spent wisely.
It is here that business aviation's support of time management may be most critically important.
The strategy presented aims to make aircraft selection a more informed, more efficient activity that considers all aspects in an impartial manner. The benefits will fall on companies and, ultimately, economies within which they operate.
Don Van Dyke is an 18,000-hr TT pilot and instructor with extensive experience in charter, business and airline operations. A former IATA ops director, he has served on several ICAO expert panels and is a Fellow of the Royal Aeronautical Society.