Last week, I got to fly to Geneva in Bombardier’s latest plane, the Global 6000. Check out my review on my Forbes column.
If god had meant us to fly he’d have given us more money. Buying a jet is expensive. Even an ‘entry-level’ jet like the lovely Cessna Citation Mustang is just under $3m.
This is where fractional ownership operators like NetJets come in. (Full disclosure, NetJets is a client of my company Articulate Marketing.) Like timeshare holidays, you don’t pay for the whole plane, just a share of it and you get to use all the planes in the network. If you’re flying less than 300-400 hours a year, this makes a lot of sense.
But you still have to stump up a big chunk of capital to buy your share plus fixed costs and per-hours costs like fuel. Cheaper but still not cheap. Now, NetJets Europe has launched a direct financing product that lets companies and individuals bridge the gap between leasing and acquisition with a 25% deposit and competitive interest rates.
This approach could cut the capital cost of buying a fractional share in a jet and sidestep potential problem in an illiquid lending market by going to the vendor for finance rather than the banks.
I asked my bank manager if he’d lend me $58m for a new Gulfstream G650. He just laughed. So I know what I’m talking about.