These days, lines seem longer than ever at the airport security gate. And when it comes to flying on public flights, there are also lengthy flight delays and rerouting to worry about it.
As a business, sometimes it makes more sense to purchase or lease a private jet if sending numerous employees on regular business trips is the norm. It can bring fewer headaches, greater flexibility with flying schedules, greater confidentiality and the ability to use a wider variety of airports.
Some things to consider:
-Get a good consultant. An experienced aircraft broker or consultant should have a thorough understanding of what types of aircraft are currently on the market and offer advice on what prices are fair and reasonable. Additionally, they should be able to discuss which types are best suited for one’s particular purposes. For example, the operating cost per hour of an aircraft varies dramatically depending on the size and model.
An experienced broker or consultant will be able to monitor the pre-purchase inspection component of the sale to make sure that one’s best interests are being represented. Without a broker or consultant present certain repairs may be deemed recommended as opposed to mandatory.
-The costs. The price of incorporating an aircraft into a company’s business does not end with the purchase. It is vital to budget for the cost of operating and maintaining the aircraft. This includes storage fees, monthly subscription services such as GPS approach-plate and weather information, sales and use tax requirements, fuel and its price volatility, regular maintenance costs, and reserves for possible repairs.
-Financing options. Same as with any other major purchase, acquiring an aircraft usually involves securing a loan. The financing of an airplane, whether for business or personal needs, is a complicated process, with many different options and lending terms to consider.
Most fixed rate loans for airplanes range anywhere from 10 to 25 years, though shorter loan periods can also be found. And as with other loans, there are fixed rate and adjustable rate options.
If considering the purchase of a private aircraft for business purposes, it is important to speak with an experienced attorney and financial expert to discuss the various options and financial considerations.
Stewart H. Lapayowker, P.A. is an aviation attorney and aviation transaction lawyer, focusing on airplane and jet transactions. To learn more, visit Businessaviationcounsel.com.
