Owning vs. charter vs. airlines

$4 billion dollar deals are pretty rare.

And ones that get lost because you get there a day later are non-existant.

Mike
MU-2


Okay, the $4B thing is a bad example, but anyone who doesn't think that
large deals have not been lost over small things has not spent enough time
around the petty country club that is now the american boardroom. The
people running most of our large corporations are more about power and ego
than dollars and sense - yes, I mean "sense".

I can't stand them, can't understand them, can't underestimate them, and
will likely have to go back to dealing with them to make enough dough to pay
for my aviation habit. Sure, many of them are just being pragmatic about the
way things are, but too many of them wouldn't change it if they could.

If you had a lot of employees who all wanted to go to the same place,
it might make sense. Even then, I suspect that you would have to
factor in the "convenience factor" quite a bit before the numbers
worked out.

"Scott Jensen" wrote in message
...
There is usually a point where it is cheaper to do it yourself than have
someone else do it for you. What I'm wondering is what would that point
be
when it comes to trans-world air travel. When does buying your own jet
and
employing your own pilots make economic sense than using an airline? Or
will the airlines always be cheaper?

More specifically, let's say you have a number of employees in Fiji. Each
gets four round-trip flights to anywhere in the world each year as part of
their benefit package. Most will want to use at least one of those for
the
Christmas season to spend the holidays with family. There would also be
an
expected heavier usage of their flight options during the summer. The
question I have is: How many employees would one need to have where buying
a
private jet and employing pilots would make economic sense? Would there
also be a span between these two options where chartering a private jet
would make economic sense?


The economic justification for business jets is that they can save very
valuable time of highly paid executives. It never makes sense on a cost per
mile basis.

Mike
MU-2

Mike Rapoport wrote:
"Scott Jensen" wrote in message
...

There is usually a point where it is cheaper to do it yourself than have
someone else do it for you. What I'm wondering is what would that point
be
when it comes to trans-world air travel. When does buying your own jet
and
employing your own pilots make economic sense than using an airline? Or
will the airlines always be cheaper?

More specifically, let's say you have a number of employees in Fiji. Each
gets four round-trip flights to anywhere in the world each year as part of
their benefit package. Most will want to use at least one of those for
the
Christmas season to spend the holidays with family. There would also be
an
expected heavier usage of their flight options during the summer. The
question I have is: How many employees would one need to have where buying
a
private jet and employing pilots would make economic sense? Would there
also be a span between these two options where chartering a private jet
would make economic sense?



The economic justification for business jets is that they can save very
valuable time of highly paid executives. It never makes sense on a cost per
mile basis.

Mike
MU-2



Add to that marketing (or lobbying) value. What better way to win over
a b2b client's business or a congressman's vote than to give them a free
ride in a corporate jet?

"Adam Weiss" wrote:
Add to that marketing (or lobbying) value. What better
way to win over a b2b client's business or a congressman's
vote than to give them a free ride in a corporate jet?

Now I would think this is a very good point. If the Fiji business were
needing to impress a little over 200 clients a year and these clients would
always want to travel to the business' location to personally inspect the
facilities, wouldn't a private jet greatly assist in this? The clients
being from all over the globe and at least half not from a major city. Each
client would always be accompanied by two assistants on these inspection
trips. However, they could be grouped together to come with other
three-person client groups and all these scheduled well in advance.

Also, each year the company would fly in its Board of Directors and they
would be spread over different continents. Wouldn't offering to fly them in
on the company's private jet be another enticement for them to want to sit
on the board? Or at least make the hassle of the trip less of a hassle thus
not as big of a negative against them joining the board?

Then again, would offering to fly the above two groups first-class be just
as good of a way to impress them?

And what about offering employees the option of trading in their four annual
vacation coach-class round-trip anywhere-in-the-world airline tickets for
one first-class round-trip anywhere-in-the-world airline ticket? Or, saying
it was going their way to do one of the above two types of trips, one
round-trip flight in the corporate jet? If they decide to take just one
vacation a year, I could see them trading up for this.

Scott Jensen
--
Like gumshoe detective stories? Like free comics?
If so, Private Eye Butterfly is the webcomic for you!
http://www.users.bigpond.com/toonerfish/peb.html

Scott Jensen wrote:
More specifically, let's say you have a number of employees in Fiji.
Each
gets four round-trip flights to anywhere in the world each year as
part of
their benefit package. Most will want to use at least one of those
for the
Christmas season to spend the holidays with family. There would also
be an
expected heavier usage of their flight options during the summer.
The
question I have is: How many employees would one need to have where
buying a
private jet and employing pilots would make economic sense? Would
there
also be a span between these two options where chartering a private
jet
would make economic sense?

And the answer is, never. These people are flying coach, to
airline-served destinations, probably purchasing their tickets well in
advance. Those tickets are filler - the airlines sell them at below
cost to keep the seats filled. Plus the time of the employee is worth
nothing because they are doing this travel on vacation, not company
time.

A private jet makes economic sense only when the people are traveling
at the last minute, to destinations not served (or not well served) by
the airlines, and their time is worth a lot.

Michael

Corporate and private jets are never about saving money. They
fulfull many strategic needs. Can you own a car cheaper than take the
bus? Never. There are other reasons you pay for that car or two you
own -

Ego - It's mine
My schedule
My space
Security
Point to point travel where the bus doesn't go
etc.

You pay dearly to own a car and do it yourself($15 to $30 per day).
People that buy corporate arcraft do the same. They are just on a
different level than the rest of us. If you were a citizen of a third
world country living in a shack, that fat cat that drives by in a Jeep
looks to him like the guy in a corporate aircraft looks to you and me.
I't just a matter of prospective.

I'm in the business of putting people in private jet aircraft and it's
not about hauling a bunch of people either. The average load factor
for all Gulfstream GV/G-550's is 3.5 even though most have 12 to 14
pax seats. This aircraft has a range of 6,700nm and the average stage
length is 1.6 hours.


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Not sure what kind of car you are talking about, but it does not cost me
$15-$30/day. Mine is about $2.00 per day, which includes purchase price,
insurance and maintenance. But your point is still valid.



Don Hammer wrote in
:

Corporate and private jets are never about saving money. They
fulfull many strategic needs. Can you own a car cheaper than take the
bus? Never. There are other reasons you pay for that car or two you
own -

Ego - It's mine
My schedule
My space
Security
Point to point travel where the bus doesn't go
etc.

You pay dearly to own a car and do it yourself($15 to $30 per day).
People that buy corporate arcraft do the same. They are just on a
different level than the rest of us. If you were a citizen of a third
world country living in a shack, that fat cat that drives by in a Jeep
looks to him like the guy in a corporate aircraft looks to you and me.
I't just a matter of prospective.

I'm in the business of putting people in private jet aircraft and it's
not about hauling a bunch of people either. The average load factor
for all Gulfstream GV/G-550's is 3.5 even though most have 12 to 14
pax seats. This aircraft has a range of 6,700nm and the average stage
length is 1.6 hours.


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Andrew Sarangan wrote:

Not sure what kind of car you are talking about, but it does not cost me
$15-$30/day. Mine is about $2.00 per day, which includes purchase price,
insurance and maintenance.

My insurance alone is nearly $2.00 a day.

George Patterson
Whosoever bloweth not his own horn, the same shall remain unblown.

On 3 Apr 2005 14:07:50 -0500, Andrew Sarangan
wrote:

Not sure what kind of car you are talking about, but it does not cost me
$15-$30/day. Mine is about $2.00 per day, which includes purchase price,
insurance and maintenance. But your point is still valid.



$2.00 is less than the price of 1 gal of gas. Hum - -

I was thinking something along the lines of -

Lease or payment $450 per mo = $14.80/day
Insurance $1,000 per year = $2.74/day
Gas $100 per mo = $3.29

Throw in maintenance etc. ---

Your numbers may be different, but $2.00/day??



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