nobody wrote:

I had a brief meeting with my CEO last week. Our company spends 80K -
120K
annually on commercial flights. He knows I am a private pilot and he
asked
me if I could prepare a comparative analysis of alternatives such as
fractional ownership, outright ownership, leaseback or charter.

I don't know jack about jets. My assumption is that I'm looking at a jet
versus a King Air or similar. We're based in Houston and regularly fly to
both coasts with 3 - 6 passengers. I am looking at a large, empty
spreadsheet. Many manufacturers and brokers offer breakdowns for their
products but I am looking for a non-biased source for several pieces of
information.

1.) Where can I find non-biased, mostly accurate estimate of direct and
indirect operating costs?

2.) There are several business jet models available for 1,000,000 like
the
Hawker DH 125, Sabre, Citation 500, Lear 24 and 25, Jet Commander. Short
of
looking up all the AD's for each variation of each model, where can I find
an honest review of those models with both pros and cons?

3.) Is $1,000,000 reasonable or should I expect those aircraft to be in
need of some serious work, AD compliance, or expensive upgrades to meet
RVSM
certification?

4.) Anybody know what a full time corporate pilot makes nowadays?

TIA,
Ed



1) There are some reports you can get Conklin and Decker I believe.

2) I would be really interested to hear what business you are in and how
your customers would find a good, non biased source. Short of consumer
goods, there really is no such thing. At any rate, do not bother. None of
those models will likely fit the needs you have described and save you
money. A jet's value is often a reflection of operating costs (much like
piston twins being cheaper than a similar single when old). Jets under a
million are often costly to operate, which is why they can be had so
cheaply.

3) Only your boss can answer that question. How cheap, slow, and light can
he go? If the same people are doing all the traveling, and they are willing
to become pilots, you could be in good shape with a couple Mooney's. OTOH,
many of the folks you need to move may be scared of anything with a prop.

4) Much of this is affected by risk. You can likely get a guy to manage and
fly the plane for 60 to 80, but you also will spend training money on him.
These costs are reflected in the C+D. He also will not be REALLY full time.
If your corporate culture will demand this guy fits in like the rest of the
mucks, you will end up paying more or having turnover.

Buying your own corporate jet will not save money from a cost only
perspective.

If you want something to take to your boss, talk to Western Airways at SGR
and talk to some of these card companies like Marquis. Get an idea of the
possibilities and lay out a trial plan with business objectives for the
trial. You want to determine if the benefits and savings in other areas
(time, ground travel, hotel, etc.) are worth further study in alternate
transportation methods. Experiment with a charter of a low cost plane and
one of the fractional use cards for the top guys to try out. If they want
to go forward after those trials it will likely be worthwhile to talk to a
consultant.

You will find that the lower cost an employ is, the better it is send them
comercial.

Also, if you are going from Houston to other large metro's at either coast,
its going to be hard to beat the regular carriers unless you can identify
ground time savings using specific airports on both ends. OTOH, if you want
to go from Houston to Shrevesport you might as well buy a plane.

Lastly, worry less about bias at first. If Cessna can't make it look good
to buy their plane, then why worry about their bias?