Using an Aircraft Management Company To Operate your Business Aircraft
By: Jamie Barrett, Jet Aviation

Perhaps you're one of the many people in business who have decided that airline transportation is not successfully meeting your travel expectations and you are now seriously considering the acquisition of a business aircraft or you have already made the acquisition. If you fall into this category you now will be faced with that all important next decision - "How am I going to operate this aircraft?" "Who is going to set-up the department and be responsible for the operations?"

While there are several options for you to choose from, the one option that many business executives have relied upon for more than 30 years and the option that is becoming increasingly popular due to corporate governance issues is the option of employing a professional aircraft management company.

Simply put, employing a professional aircraft management company to operate your aircraft is "Aircraft ownership made simple". You retain full and complete control of your aircraft at all times and the entire operation and management process is outsourced to the management company.

This concept was created in the late 1960's by a gentleman named Matt Weissman with the financial backing of the Zilkha family. His company was called Executive Air Fleet. The company was purchased by Jet Aviation in 1988 after Jet Aviations' entry into the United States market. Today there are over four thousand management companies in the United States ranging from your local Fixed Based Operations organization at your community airport to the large internationally acclaimed professional management organizations like Jet Aviation.

What you have to realize is that all aircraft management companies are not created equal. The overall management process can vary from company to company and the prudent aircraft owner or prospective owner needs to do their due diligence on the process before making their selection.

At Jet Aviation, our aircraft management process is a complete turn key program where we act as, and become, the aircraft owners outsourced flight department. All aspects of the operations are handled by Jet Aviation and all costs for the goods and services are passed through to the owner directly without mark up. A set of books are opened in the clients name and Jet Aviation then becomes responsible for paying all bills. We handle flight crew member selection, interviewing and testing, maintenance planning and pre- purchase inspection monitoring. The personnel are interviewed by the prospective owner and if approved, they are hired as Jet Aviation employees and become assigned to the owners account on an exclusive basis.

In our flight operations department, which is located in Teterboro, New Jersey, a flight management representative (FMR) is assigned to the client's account. This person is responsible for the day-to-day scheduling of the aircraft and typically works directly with a person in the clients' organization. The FMR has a dedicated group of additional FMRs serving as a back up for complete 24/7/365 coverage and the group fills in for FMR vacations, holidays and after hours emergencies. The FMR is responsible for all trip details including, scheduling, catering, ground transportation, and hotel reservations. For international travel they also coordinate with our in-house international flight-planning department to insure that all international details like navigation authorizations, over flight permits, customs and immigrations coordination is obtained. 

Aircraft maintenance oversight is conducted by our maintenance coordination department and all maintenance is performed on the client's aircraft by approved FAA repair facilities, and/or a dedicated crew chief who will be assigned to the client if the aircraft is based at a location other then a Jet Aviation facility. This process allows Jet Aviation to compete in the world wide arena of aircraft management and gives the client peace of mind that the aircraft is always being checked and reviewed for complete maintenance compliance. 

If the client's needs are such that there will be periods of non-utilization, the client can choose to have the aircraft certified for FAR part 135 third party charter operations. This program helps to offset some of the fixed cost associated with aircraft ownership. At Jet Aviation our charter services group markets the aircraft for the charter certificate holder and the revenues produced are returned to the aircraft owner less a small marketing fee. Third party charter payments are guaranteed by Jet Aviation against non-payment and a monthly summary of charter revenue is included with the client's monthly executive summary. 

In order to track the entire process and keep communications constant with the client, Jet Aviation assigns a Vice President of Client Services to the client's account to act as the single point of contact on all administrative issues. This process allows Jet Aviation to streamline the process and it increases our responsiveness to the client's service offering. 

For this entire management process Jet Aviation charges a monthly management fee and all goods and services that are bought or provided to the owners are done so at direct cost without markup and 100% of any achieved discounts are credited to the clients account. One pitfall you may have when comparing management companies is in comparing the monthly management fees. Some companies charge smaller fees and then have hidden mark up and charges for the types of services they perform.

In closing it is important to note that that business aircraft are assets that have to be managed meticulously. While the process can be done internally the cost to do so sometimes does not make economic sense. Aircraft management firms like Jet Aviation have developed sophisticated financial and operations processes to ensure that the owners achieve maximum cost savings and revenue enhancements from their aircraft while flying them in the safest possible manner. 

Jamie R. Barrett is the Senior Vice President of Aircraft Management Sales for Jet Aviation Business Jets, Inc. a division of the Jet Aviation Group of Companies. He is a 28+ year's veteran of the business aviation industry, a graduate of St. Louis University's Parks College of Aeronautical Technology. He has an Airline Transport Pilot certificate and a type rating in the Learjet. He and his wife Janet reside in Summit, New Jersey. 

Jet Aviation Business Jets, Inc. is one of many aircraft management Companies in the world. The processes described in this article should serve as an example of Jet Aviation's process and a benchmark by which to evaluate other companies in consideration. Call Jet Aviation to learn more about their process and differentiating benefits.