SP’s Aviation|March 2020
LUXURY, OPULENCE, GRANDEUR, EXTRAVAGANCE, MONEY ARE some of the terms that come to our mind the moment we spot or think about a private business jet. Owning a business jet has always been looked at as a very wealthy person’s affair. We often assume that it’s mainly meant for only celebrities or rich businessmen who have too much money to spend. However, what if we told you that business jets could actually make better financial sense even if the ownership amounts to millions and millions of dollars? It doesn’t sound quite right, isn’t it? Let us help you understand the above statement better and give you reasons why owning a private jet is not just about having those extra pennies to spend, especially for companies.
The ownership of a private jet has often been overpowered by societal explanations rather than the economic ones. However, the advancement of globalisation has been seemingly beneficial for the private jet market as businesses are now required to travel far off places and reach out beyond their local area. Especially as more and more companies are beginning to outsource manufacturing and other operations into developing countries, which don’t necessary have much air service, many companies have determined that private jets are a better way to get where they need to go.
If, for instance, one was to charter a Gulfstream from London to Dubai, it would cost about $55,000 at rack rate. However, if you fly Emirates First Class, which is almost similarly luxurious, you could fly between the two cities roughly twenty times for the same price. It thus comes across as a bit strange when businesses that are supposed to maximise profits for their shareholders are able to justify this enormous expense as worthwhile. How it that there’s still a class of people is are okay spending tens or even hundreds of thousands of dollars on just one single flight? It could practically not be just for showing off luxury.
This is so because, for CEOs (Chief Executive Officers) and other higher executives, private jets work as risk mitigators in a way. Private travel gets preference to ensure on-time arrival at a destination, and in the best possible shape (physically as well as mentally) accompanied by comfort. Busy executives on top levels of a company cannot afford to show up late for an important meeting or to feel sluggish due to the adversities of commercial travel. For them and their company, the cost of failure largely exceeds the cost of private jet travel.
Here are some reasons why private jets are an efficient way to conduct business and hence make more sense:
• One major reason that companies use private jets is the time that they save. If you fly private, you can save all the hassle and time needed at the airport for check-in, securities, and other formalities. All you need to do is arrive, get on the plane, and fly rather than having to navigate your way through a busy terminal for fixed flight time.
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