Looking for non-biased resource

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

A good pilot alone will take up half of your 80-120K, you will most
likely need two.
Michelle

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

Michelle P wrote:
A good pilot alone will take up half of your 80-120K, you will most
likely need two.

Which is why the fractional ownership stuff comes with fractional pilots
as well :-0

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?

Responses in-line
"Dude" wrote in message
...

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.

------------
Yeah, thanks, somebody mentioned that earlier. I've got their website and
I'll follow up this week.
------------

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.


------------
We develop, sell, install and support a suite of software packages for
fortune 250 companies. We give them the software for 60 days. If they like
it they buy it. If not the software quits working. Wonder where I can
borrow a Gulfstream V for 60 days for free so I can evaluate it?

We are a far cry from a "manufacturing" company but you can easily draw
an analogy to one. The idea behind establishing a flight department is to
increase our production capacity. Simply put, the faster we can get from
one customer to another, the more product we can install, the more income we
can realize. Currently, we can do about 5 installations, including
training, per month depending upon how much the customer chooses to
customize the installation. Reducing round trips by a day on both ends
reduces hotel, car, meals and fatigue. The team should be able to increase
to 8 or 9 installations a month (approx 2 per week) assuming our sales
department can keep them booked up like they do now.

------------

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.


------------
I have a PA28-161 and have used it on several occasions to service accounts
in San Antonio, Austin, Dallas, Lufkin, Bartlesville, OK and Baton Rouge.
Those trips were less than spectacular because I assumed the role of one of
the specialists on the team and I still had my head in the cockpit when I
got to the client. My mind began to drift to weather and flight plans long
before the real work was done.

Speed is the value here. A slow expensive airplane will not pay for itself.
------------

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.

------------
Full time referring only to the idea that we are his/(her) first priority
and it may be on short notice.
------------


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

------------
Understood and agreed. The only possible justification is the increased
efficiency of our installation teams.
------------


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.

------------
The cost here is the team concept. We have tried the one man wears all hats
routine and it fails miserably. When we go onsite, the bare minimum team
size is 2. Depending upon the customer, the relationship and the size of
the deal, there may be as many as 6 employees traveling to the same
customer.

I'll give western a call tomorrow. SGR is only about 10 min from the
office. That's another time savings.
------------

You will find that the lower cost an employ is, the better it is send them
comercial.
------------
See above: Multiple mid-level employees
------------

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.

------------
Thats the key. Just guessing but I would say that only 15 or 20 percent of
our customers lie within 50 miles of a commercial airport.
------------


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?


------------
Good point.
------------

"nobody" wrote in message
. com...

------------
We develop, sell, install and support a suite of software packages for
fortune 250 companies. We give them the software for 60 days. If they
like
it they buy it. If not the software quits working. Wonder where I can
borrow a Gulfstream V for 60 days for free so I can evaluate it?

We are a far cry from a "manufacturing" company but you can easily draw
an analogy to one. The idea behind establishing a flight department is to
increase our production capacity. Simply put, the faster we can get from
one customer to another, the more product we can install, the more income
we
can realize. Currently, we can do about 5 installations, including
training, per month depending upon how much the customer chooses to
customize the installation. Reducing round trips by a day on both ends
reduces hotel, car, meals and fatigue. The team should be able to
increase
to 8 or 9 installations a month (approx 2 per week) assuming our sales
department can keep them booked up like they do now.


Sounds like you need to open a regional office or two. I don't know of any
companies that send their mid-level people around in jets all the time. Buy
them first-class tickets everywhere and let them stay in good hotels and
that will keep most people happy. Or hire younger people.

-cwk.

The regional office idea sounds pretty smart to me as well. You might want
to cover that with your boss.



"C Kingsbury" wrote in message
ink.net...

"nobody" wrote in message
. com...

------------
We develop, sell, install and support a suite of software packages for
fortune 250 companies. We give them the software for 60 days. If they
like
it they buy it. If not the software quits working. Wonder where I can
borrow a Gulfstream V for 60 days for free so I can evaluate it?

We are a far cry from a "manufacturing" company but you can easily
draw
an analogy to one. The idea behind establishing a flight department is
to
increase our production capacity. Simply put, the faster we can get from
one customer to another, the more product we can install, the more income
we
can realize. Currently, we can do about 5 installations, including
training, per month depending upon how much the customer chooses to
customize the installation. Reducing round trips by a day on both ends
reduces hotel, car, meals and fatigue. The team should be able to
increase
to 8 or 9 installations a month (approx 2 per week) assuming our sales
department can keep them booked up like they do now.


Sounds like you need to open a regional office or two. I don't know of any
companies that send their mid-level people around in jets all the time.
Buy
them first-class tickets everywhere and let them stay in good hotels and
that will keep most people happy. Or hire younger people.

-cwk.

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



You might try to contact the flight department of a local corporation or
two. They may or may not be willing to share cost data. Also, a local
charter operator might be of assistance. I'm not that familiar with the
NBAA, but they might have something as well.


Matt

Matt,

My company is in the business of doing those kinds of studies. One
thing I can say with confidence is there is no way you can own a jet
cheaper than taking the airlines. When people or companies decide to
get their own aircraft, it is some of the same reasons you own your
own car. Public transportation is certainly cheaper.

Ego - I always wanted my own (The Jones's deal)
My own space
Point to point transportation
Can't get there from here
Fits my lifestyle

Can it be cheaper? - never. I don't get involved with small older
jets, but budget about $1M a year to operate a larger one.


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Don Hammer wrote:

Matt,

My company is in the business of doing those kinds of studies. One
thing I can say with confidence is there is no way you can own a jet
cheaper than taking the airlines. When people or companies decide to
get their own aircraft, it is some of the same reasons you own your
own car. Public transportation is certainly cheaper.

Ego - I always wanted my own (The Jones's deal)
My own space
Point to point transportation
Can't get there from here
Fits my lifestyle

Can it be cheaper? - never. I don't get involved with small older
jets, but budget about $1M a year to operate a larger one.

I never said it would be cheaper, I was just providing some ideas for
him as to how to obtain representative costs.

Another big reason nowadays is security for corporate executives. And
if you consider the cost per hour of a CEO in the equation, then often a
corporate aircraft will save the company money compared to using public
transportation and the additional time that consumes. Keep in mind that
many CEO's make upwards of $1MM annually. If you figure 2,000 working
hours, that is $500/hour. If you add 4-6 hours to every trip for the
CEO to take an airline flight, that is a fair chunk of change. It may
still not make the corporate airplane more cost effective, but combined
with the other advantages you list above, it can make the decision much
more logical.

And if you use a fractional ownership program, it gets even better.


Matt