If you have never purchased, leased, or used a private business jet, it is nothing like other buying or flying experiences, even if you have bought or used numerous high-value vehicles or real estate. Transactions like those will not prepare you for traveling on or acquiring a private jet. This is regardless of a plane’s brand, model, aircraft size, split ownership, financing, repair and/or refurbishment.

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Private Aviation or Commercial Aviation?

People who do a lot of first-class commercial air travel, whether the expenses are out-of-pocket or company-paid, and they start to consider the benefits of private aviation, should keep the following air travel hierarchy in mind:

• Before switching from commercial aviation to private aviation, the rationale for doing so should include travel convenience and flexibility. There are other factors to consider, but they are unlikely to rise to a level of importance greater than convenience and flexibility.
• If adequate rationale is confirmed, consider booking a trip and flying on a private jet that might be of interest. This will help decide whether the experience was favorable or not, and whether to take the next step of leasing or buying.
• If everything points to acquiring a private business jet, determine whether to buy it or lease it. If owning a private business jet is not going to be a long-term need, consider leasing a jet in lieu of buying one.

Booking and flying on (not buying or leasing) a private business jet – small vs large

The majority of this article will focus on the complex transaction of buying or leasing a private business jet. But, the first discussion is much simpler: The pros and cons of a smaller plane vs a larger one.

When it comes to booking a reservation and flying on a small vs large business jet, it is mostly about the cost and the size of your party. Generally speaking, the perks and amenities have a lot of overlap between the two sizes.

If speed-to-destination is an important factor, small business jets are significantly slower, and cannot fly as high as larger ones. Comparing the airspeed of a small Cessna Citation CJ4 vs a larger Gulfstream G650, the difference is quite stark: CJ4: 450 mph vs G650: 610 mph.

Commercial air carriers do not fly above 45,000 ft. Small business jets typically top-out at this same altitude, so you are mixed-in with all of the airliners. Most of the large business jets can fly up to 50,000 ft. to avoid the congestion below.

The choice of booking and flying on a small vs large business jet is fairly straightforward.

Common factors in any business jet purchase, large or small

Photo: InsectWorld l Shutterstock

Convenience and Flexibility – If an aircraft purchase is being considered, the rationale should include owner flexibility and convenience. If neither of these factors are part of a buyer’s consideration, then it needs to be reviewed to ensure that the buying rationale is something that can actually be justified.

No Dealers – Throughout the business world, a major consideration for any company is their marketing and sales planning for the products or services that generate revenue.

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When it comes to marketing and sales of any aircraft, OEM-endorsed dealerships are the exception, not the rule. Whether an aircraft is new or used, an aircraft OEM usually does not have enough sales volume in any given region to justify a local factory representative on the payroll, or a contracted agent.

The purchasing process is more complex than buying a car or boat, and involves working with brokers and aviation experts. The transaction complexity is on par with a home purchase.

Aircraft purchasing is a lengthy process – Depending on the OEM and/or a specific model, factory backlogs are not uncommon, and delivery lead times can be more than a year.

Buyer Technical Competency – Either the buyer themselves, or a contracted technical expert, needs to conduct a detailed analysis of the more complex aspects of the transaction. Examples include an FMV (fair market value) analysis of the aircraft, a comprehensive technical inspection by an FAA-licensed A&P mechanic, and a careful review of all available records to determine airworthiness and FAA regulatory compliance.

Flight Time…the Vital Metric – Flight time and engine run time are important for making purchasing decisions. In aviation circles, flight time is also known as “Tach Time.” Engine run time is often referred to as “Hobbs Time.”

Hobbs time is meant to be an accurate representation of how many hours and tenths of an hour that a plane’s engine(s) is running, regardless if the engine was started in the hangar for doing some troubleshooting, taxiing, or in the air.

Most pilots log their flight hours based on Hobbs time because anytime a pilot is sitting in the seat with the engine running, it is considered a part of the overall task of “flying.”

Tach time only registers when the engine RPM exceeds a predetermined amount, which typically occurs when the throttle is advanced for takeoff. The purpose of Tach time is to track the amount of time an engine is under load.

Knowing these metrics informs the buyer about wear and tear, and whether significant maintenance is in the near future.

Aircraft age and/or warranties are not as important as they are for cars. It is, however, important to note whether the plane has a contracted maintenance plan, and will it transfer to the new owner?

Purchase Price and Fixed Costs – For many private jet owners, it is not uncommon for the purchase price to be the most expensive single item they have bought to-date – higher than any vehicle or home.

Fixed costs are any expenses other than the purchase price that has to paid, regardless of usage or not. The fixed costs can be upwards of 10% of the plane’s value, and includes such things as: storage fees, insurance, fuel, aircrew wages, and maintenance fees.

A common question asked by prospective private business jet buyers is “How rich do you have to be to own a private jet?” The Institute for Policy Studies published a May 2023 High Flyers Report that answered this question:

“The median net worth of a full and fractional private jet owner is $190 million and $140 million respectively. They represent 0.0008 percent of the global population. The jet-owning oligarchy is overwhelmingly male, over the age of 50, and concentrated in the industries of banking, finance, and real estate.”

Photo: Embraer

Depreciation – An aircraft is just like any other capital expense, in that, it’s value will depreciate over a period of years. The owner should look into taking advantage of the depreciation on their financial statements and tax filings.

Factors favoring the purchase of a small business jet vs a large jet

Once a prospective aircraft purchase has been reviewed for the common factors noted above, and there are few or no issues in that regard, it is time to review the factors that would favor buying a small business jet rather than a large one.

Lower Costs – Small jets normally have a lower purchase price, and lower fixed costs (insurance, fuel, etc.) than large business jets.

Smaller Groups and Shorter Flight Distances – If typical travel needs are shorter flights or the passenger headcount is six or less, a large jet might be more than what is needed.

Large business jet buyers will sometimes complete the purchase using the logic of greater flexibility, but it is rarely needed.

Photo: Cirrus Aircraft

Ability to Access Remote Locations – Smaller jets can access remote locations that larger jets cannot, providing greater flexibility in travel destinations. An actual example is useful for understanding.

In the 1960s, during the Johnson Administration, the President always had access to Air Force One, but it was problematic when he wanted to fly home to his ranch in Texas.

LBJ’s ranch was in central Texas, about 10 miles west of Johnson City. Gillespie County Airport in Fredericksburg, 15 miles west of the ranch, was the closest paved runway; it was 5,000 ft. long. Even a small business jet could not land there, let alone Air Force One.

The closest airfield with a long enough runway and adequate security that met Secret Service requirements, was Bergstrom AFB, 10 miles southeast of Austin, TX. If the President flew into Bergstrom, he still had a one-hour helicopter ride to the ranch.

For trips home to his ranch, he used an Air Force VC-140B. This was a Lockheed Jetstar, the first private business jet. The President paid to build an 8,500-foot private runway at the ranch, so the Jetstar could be used.

If a private business jet owner does not want the hassle of flying into a larger airport, and then uses secondary transportation to the final destination, a small business jet will get much closer to the final destination by using a small or private airfield.

Summarizing the discussion

Once the decision has been made to fly on a business jet in lieu of flying on a commercial airline, the next decision is whether to book a flight with an agent, or buy/lease a business jet.

The final decision is whether to buy a small or large business jet. The best advice is to be honest with yourself in justifying the decision.

Avoid over-rationalizing the decision. What comes to mind is not cramming a square peg in a round hole. A forced decision will likely backfire at the most inopportune time, and it might be very painful to undo.