You’ve tried on-demand charter, you’ve tried a charter membership or jet card, even fractional ownership, but these options just aren’t cutting it. You want the freedom to customize your aircraft, you want to be able to fly wherever you want, whenever you want, and let’s face it; you want to be able to tell people that you own a private jet. We don’t blame you! Before you jump headfirst into aircraft ownership, here are eight steps that you absolutely must take in order for the acquisition to go smoothly.
- Assess your mission. The first step is to determine your “mission” or how you’ll be using your plane most often. How far do you need to fly? How long is the runway at the airport you’ll most often be flying to? Are there mountains in your area? We generally recommend buying a plane that will suit your mission 80 percent of the time. If you fly to Hawaii once a year, but will fly within your region the majority of the time, it isn’t necessary to get a transcontinental aircraft.
- Determine your budget. This one sounds easy enough, but it may be more complicated than you think. It’s not just the purchase price you need to consider. Operating costs, pilot/crew salaries and training, hangar costs, insurance and taxes need to play into your aircraft ownership budget. An older plane might have a substantially lower purchase price, but will likely end up surprising you with high operating costs. It’s also critical to consider upcoming maintenance costs. If the plane you’re considering needs an avionics upgrade or an engine overhaul in the near future, be prepared to spend some dough.
- Get good tax advice. In the U.S., some states provide fly-away exemptions, so you don’t owe sales tax on the purchase to that particular state, but many states have tax laws that must be navigated properly to create the lowest tax burden possible. This can be even more important in countries outside the U.S. It’s important to hire the right attourney; one who knows the tax implications of buying an aircraft, where you should take delivery, and where you should keep your aircraft in order to minimize the tax hit.
- Make an offer. Before making an offer, it’s important to have done some research on the current state of the market. You should know the selling price (not just the asking price) of similar planes, how many have sold, how saturated the market is, etc. This is where we shamelessly plug our market reports, which you can sign up for by clicking here. Since sales figures are not publicly disclosed, it’s a good idea to engage with a reputable aircraft broker who has this information at his or her fingertips.
- Do a thorough pre-purchase inspection. You wouldn’t buy a used car or a house without doing a thorough inspection before signing on the dotted line, would you? It’s even more important for aircraft. You’ll want to know environmental conditions in which the aircraft was operated or stored. If the aircraft spent significant time it a place with high humidity, salty air or frequent ice, you’ll need to pay special attention to the landing gear and its surrounding parts for corrosion. Make sure you go over the logbooks in detail–especially if you are planning to take the aircraft to a different country. Check out more on pre-purchase inspections here.
- Plan for the aircraft’s management. Whether you want to hire an aircraft management company or manage the aircraft yourself, you’ll have to hire a pilot, figure out insurance and hangar, decide where you’ll want to maintain the aircraft and, of course, order the monogrammed glasses for the galley.
- Close on the aircraft. Typically in the U.S., escrow agents will handle the title searches, exchange of documents and funds, and registration with the FAA. If all of that goes smoothly, it’s a pretty simple process.
- Make it yours. Whether you want to add logos inside or out, change the paint job, or customize the interior, now is the time to do it! You’re now the proud owner of a private aircraft. Time to start making connections with people, not commercial flights.
If you’re thinking about making the jump to aircraft ownership, please let us know! Drop us a line via email, or give us a call at (512) 868-9000. You can also sign up for our mailing list by clicking below.
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