Jet Card Comparison Guide by Alyson Wuamett

Jet Card Comparison Guide

Comparing Jet Cards

wenty-five years ago the private aviation market lacked consistent, effective solutions for regular private jet use. Aircraft ownership and fractional ownership were the two common solutions for corporations and individuals to have guaranteed access aircraft on short notice. Now, though, like many other products and business models, the industry has evolved to become more efficient, reliable, and cost effective. Jet membership has become extremely popular due its flexibility, convenience, consistency and relatively low capital outlay—and therefore risk. For private flyers traveling 5 or more times annually it now makes sense, both from a value and a simplicity standpoint, to have a guaranteed solution available to you with just a phone call. When evaluating private jet membership programs, it’s important to weigh all of the factors together. The last thing a new member wants to find out is that they can’t use their hours on a holiday or that they’ll receive a bill with additional management fees every month. Other things to consider include cancellation terms, required notice, upgrade/downgrade flexibility, and fleet characteristics. Each of these factors can make or break a membership program for individual fliers. We invite you to review this information so you can see for yourself a side-byside comparison of the benefits and costs of several of the most popular programs.

Looking for more information? Check out Researching Jet Cards: 7 essential questions everyone should ask

Jet Card Comparison Guide

What’s Included?

hile researching various programs for your private travel, be sure to understand the costs associated with your hourly rate. More importantly, you’ll want to understand which costs are not included in that rate. You’ll also want to know the length of time that the hourly rate is guaranteed for. Industry wide, the wholesale market has experienced around a 15% cost increase over the last 4 years. Having your hourly rate locked in for a period of time can be very beneficial to you in the long run. If you are being provided with an “introductory” hourly rate, make sure that you are aware of the length of time it’s good for and what the increase will be once it expires. When comparing Jet Membership with Fractional Ownership, you will also want to be sure that you know and understand the differences between the two types of programs. Typically, the hourly rate in a fractional will appear much less than jet membership. However it’s vital to factor in monthly management fees, acquisition and residual costs, fuel surcharge, re-marketing fees, and of course the cost of having your capital tied up in an asset to determine exactly what you are paying. When reviewing the two models to determine what the best solution for you is, we recommend retaining a 3rd party aviation consultant to help. Firms such as Jet Advisors specialize in aviation consulting and can provide in-depth information include tax planning and benefits analysis.

For more information on fractional considerations, take a look at Top 5 Issues When Selling a Fractional Share

Jet Card Comparison Guide

What Other Fees are Due?

ake sure you are familiar with the additional fees that you will be responsible for in your jet membership. Traveling outside of the United States, during holiday periods and popular events, or even during poor weather conditions can all mean additional fees. Surcharges for high-demand or international travel typically increase the number of hours that are deducted for a trip, and inclement weather can require hangaring or de-icing that is usually billed to you. Bringing your furry friends along on your trip can also be an additional fee that is typically charged on a case by case basis and can depend on the size of the pet or if any damage was caused to the aircraft. Cleaning fees of this sort typically range between $200-$1,000 depending on the aircraft and reason for the fee. One helpful hint is to make sure your provider is aware that your pet is a regular passenger so they can add that to your profile and plan accordingly, since not all aircraft allow pets in the cabin.

What Benefits am I Receiving?

hile it’s important to compare hourly rates and total capital outlay, you will also want to factor in any benefits that your membership offers that bring you more value. American Express said it best—“Membership has its privileges.” Most of the leading Membership programs offer exclusive perks in appreciation of the commitment you’ve made. Benefits may include complimentary upgrades, fuel discounts, credits back for longer flights, limousine transfers, and VIP access to top events around the world. Many of the leading companies also have strong partnerships with other luxury brands, fine hotels, and premium products which can be of extra value to you, your family or business. These benefits usually won’t be the deciding factor where prices are substantially different, but they can help with making a final decision between two similar programs.

Jet Card Comparison Guide

Can’t I Book Charter Flights Instead?

aws of Supply and Demand have been a large driver in the increase in popularity of membership programs over the last 18 months. In a report released by ARG/US Research, August 2012 to August 2013 saw an increase in Part 135 flight activity (charter, membership, and fractional overflow) of close to 17%. This translates to higher costs, less flexibility, and tougher scheduling. For private flyers travelling regularly, not having a guaranteed solution with a consistent provider can compromise the biggest benefit of using private aviation: time. Lack of a guaranteed option means more work is needed when booking each flight, there is much greater variability in costs, and flexibility can be severly limited. Other factors to consider when choosing between on-demand charter and membership are scheduling requirements (most memberships allow short-notice booking), average age of aircraft, consistency of aircraft, guaranteed availability and pricing, ease of use, and fringe benefits. For passengers that are retired and generally using the service to travel between homes, on-demand charter is usually a nice fit as they have more schedule flexibility and if something changes on their charter flight, it is typically not interrupting something they have scheduled. For travellers with a tight schedule, however, on-demand charter can easily become a “hope-and-pray” endeavor. Working with the right on-demand charter company is equally as important as choosing the right membership company and we recommend asking many of the same questions about company infrastructure, staffing, insurance, safety standards, etc.

Learn more about on-demand charter with Chartering an Aircraft: A Consumer’s Guide to Help You Fly Smarter

Jet Card Comparison Guide

Feature Comparison

ere you will find side-by-side comparisons of the some of the leading jet membership companies you may be considering. These companies share many of the same qualities in terms safety standards, infrastructure, quality and age of aircraft, and minimum hours that can purchased. Remember that not every program is designed for every passenger’s needs, so asking the right questions to ensure that benefits you are receiving as well as the values of the company will be important to a successful relationship with your provider.

Flight Options

Flexjet

Marquis Jet

Magellan Jets

Guranteed Wi-Fi

Available

Late-Model Aircraft

Dedicated Operations Team

Fuel Surcharge

Variable

Black-out Dates

Jet Card Comparison Guide

Pricing Comparison

ow that you’ve narrowed your search down to a couple of key vendors, it’s time to start analyzing the hourly rates. When reviewing your hourly rate, remember to consider the value of any “benefits” or “perks” included by your membership company. Age of aircraft is also something to consider, as you may not want to sacrifice aircraft quality to pay less. Know what is included—and not included—in this rate. Fuel surcharges and Federal Excise Tax are two of the most common add-ins, so ask if your hourly rate is “all inclusive” if you are not sure.

Light Jet

(Hawker 400XP/ Citation Encore/ Learjet 40XR)

Midsize Jet (Hawker 800XP/ Learjet 60XR)

SuperMidsize Jet (Citation X/ Challenger 300)

Large Jet

(Challenger 604/ Falcon 2000)

Flight Options

Flexjet

Marquis Jet

Magellan Jets

$6,575

$5,400

$6,556

$4,350

Not offered

$7,125

$8,176

$6,200

$8,600

$9,150

$9,916

$7,985

Not offered

$10,400

$13,116

$10,495

Pricing based on 25 hour purchase and is current as of Nov. 2014 Fuel surcharges additional and vary by program and card purchased

Jet Card Comparison Guide

Make Smart Decisions

oday’s private flyer is far more savvy then they were 25 years ago. With advancements in technology, the rise of blogs and social media, and the availability of endless online information, it is far easier to make educated decisions when choosing a private aviation solution. We now have the resources at hand to easily see whether companies meet our needs with their product offerings, provide the value we expect, and offer the simplicity we want. When choosing your provider you can take comfort in the wealth of knowledge at hand and you’ll benefit from the increased competition and choices available. However, it’s important to remain cautious and skeptical, as many “fly-by-night” providers have also capitalized on modern technology to enter the market. Be sure your provider has the right operations team and management in place, is leading in innovation, offers responsive product lines, and talks about safety before price.

About the author: Anthony Tivnan is President and Co-Founder of Magellan Jets. Learn more here.