Modern aviation provides opportunities to impress even the most demanding customer. It is possible to get the latest and most technically sophisticated business jet models at your disposal, but along with their purchase the potential owner faces a whole range of issues
Management of private aircraft as a business asset covers the most diverse and unexpected areas and to be effective, it is necessary to take into account a number of factors. First of all, it is necessary to determine the choice of aircraft at the time of purchase. What is your preference: buying a new aircraft from the manufacturer or on the secondary market? An aircraft manufacturer’s order is usually dictated by the desire to obtain a new model with a maximum range of the latest technical features, or when a trade-in scheme is implemented with the crediting of the old aircraft for the new one. Here the buyer has an opportunity to play on the competition between airlines, for example, turning to Bombardier as a Dassault customer. The benefit of such a purchase could be several million dollars.
It is also possible to buy an aircraft in the secondary market, when a number of structures get rid of non-core assets obtained as a result of pledge operations or bankruptcies. For instance, VTB Bank recently sold a Gulfstream G450 received from Uralvagonzavod. Its value was 50% less than if the same model “from the conveyor belt” was purchased. There are rumors that the planes of the former owners of Promsvyazbank Alexei and Dmitry Ananiev are for sale. Buying an aircraft is a calculation not only of the original value, but also of the residual value, so it is also worth exploring financing options, often with stressful sales you can negotiate attractive installment terms.
The suggested value can be compared to a number of aircraft information databases that show their approximate market value. Among them is the official guidebook for business jets, the so-called blue book, which shows the official residual value of a particular aircraft, depending on its options, serial number, manufacturer, and other things. It is essential to pay attention to the aircraft maintenance programs and its main components. This information is key, since it affects the residual value of the aircraft and the risks of its operation. The price of the same model may also vary significantly depending on the set of technical options offered by the aircraft. Particular care should be taken to check the aircraft’s previous operating history and maintenance history to identify possible nuances.
When a person finally becomes the owner of a private aircraft, he should think about the economic model and carry out continuous monitoring. If the frequency of flights has decreased and you in contrast to Oleg Tinkov #32 with his Falcon 7X fly less than 300 hours a year, then examine the possibilities of commercial operation: assess the potential workload for charters, calculate your flight hours map. Restructuring your loan or lease payments using additional assets (real estate and others) may be a good option. If the aircraft is pledged, apply to other lending institutions – this market also has its own competition for the customer.
Registering the aircraft under a certain flag will also help optimize costs, which will provide tax jurisdiction according to commercial load and other factors. Each country has its own aviation register with its own rules and nuances. The new owner should decide for himself/herself in which country, depending on the local tax laws and the aircraft financing scheme it is more convenient to register, as well as to fix the geography of the aircraft operation. If the purchaser does not intend to use the aircraft for commercial flights, the registration of the aircraft in an “offshore zone” is more preferable. If the owner plans to use the aircraft for commercial flights, then the most optimal for him to register in a European country, such as Austria or Malta.
One of the main principles the owner should put at the top of his agenda is transparency of all operations that are performed for his personal aircraft. The actions of each link should be open in real time for inspection by all specialists: from the expert team (before the purchase) to the maintenance personnel, flight crew and control center. By creating a transparent mode, the owner facilitates the solution of many issues: the selection of a team of pilots and service personnel with, for example, knowledge of certain languages; ensuring the cheapest possible and at the same time safe for the technical condition of the aircraft storage; implementation of urgent repairs of the business jet. Otherwise, a situation like the one that happened to one of the big companies, which overly trusted a well-known Swiss operator and lost access to pilots’ contracts, could arise. The result of the audit was that the amounts billed as pilots’ salaries were seriously overstated.
Of course, every aspect of private aircraft management should be handled by professionals: financial managers with experience in working with international assets, technical specialists with knowledge of the specifics of servicing business aviation jets and helicopters. But taking into consideration the special status of business aviation owners and passengers in Russia, which requires privacy, specialists should also keep it confidential. Otherwise such information may inflame public opinion, as was the case with the comment on the published photo of Timati on board the business jet, when an employee of one of the companies actually confirmed to the media that the plane is often used by Ramzan Kadyrov.
Competent specialists should not only provide the owner with the necessary information about the operation of his aircraft on a regular basis, but also monitor and analyze emerging trends in the industry. For example, the introduction of a new apron at an airport with attractive prices for parking along with a number of related services means the prospect of serious cost reductions. Recommendations should also be multivariant, reflecting the competitiveness of the market. This will help the owner get out of the rather traditional trap of getting used to the same pilots, maintenance center and whatnot. The owner may be psychologically comfortable in these cases, but he begins to incur unnecessary costs: the appetite of pilots and technical centers grows, but their economic efficiency drops.