The refreshing part of reading the New Yorker is knowing that so many jet and fractional owners are reading it too.

Of that group, it is important to note that private aviation readers can be divided into two groups: Those that made their own money vs. those that were born into it or just had good timing off the bus from Amherst into Goldman Sachs.

The ones that built their own usually have one thing in common - they knew how to get something far below its actual value. This would be the opposite of buying a business jet - which, until now, has been an exercise in paying far more for something than its actual value.

This article highlights one critical thing that leads to fantastic failures of start ups and large well established corporations alike, not to mention the umpteen air taxi start ups fueled by delusional assessments of how business people actually use private and commercial aviation.

No matter where you find yourself in the aviation landscape, you realize you are often surrounded by folk who have lost touch with their inner negotiator - the one that always wants to buy the aircraft right, since buying right is far easier to control than selling right, especially when you are in a hurry. Playing Monopoly teaches us this, but documenting the success and growth of shrewd entrepreneurs underscores one point - buying on the right terms, below market value and doing so while mitigating risk are the cornerstones of success. (That and also getting control of the railroads early in the game - statistically they are an ATM!)

So what does this have to do with private aviation? Now that everyone is selling, you might ask yourself: “How did I buy this aircraft / fractional contract so wrong?”

Answer: Lots of folks did, you aren’t alone, and yes, you lost touch with the fact that even though it costs as much as a building, you didn’t vet it like a building. Because it had wings, you went into some other place, where dollars have less value.

WHAT NOW?

This year will be huge in that more air charter / taxi firms will be grounded due to painful red ink and the fractional landscape concludes an upheaval that will most likely cut another 25% off select airframe values.

If you were ever contemplating becoming an aviation entrepreneur - now is your time to think about how to buy assets inexpensively and change the game on how they are managed, marketed and justified.

The reality is that private air transportation is here to stay - but how it is done, has to change if long term value is to be offered to the owners, operators and passengers of the industry.

THE OPPORTUNITY

It is no secret that the Christmas 2009 failed underpants bomber has yet again sent the TSA into a place that is crippling commercial air travel. At the same time, every major private aviation player is feeling the pain associated with the image of flying privately and the very real costs that are near impossible to justify.

In short, there exists a large opportunity in aviation. It lies between the two. It isn’t snap your fingers on four hours notice (we call this the Golden Chariot), nor lots of Eclipses, and certainly we know it isn’t the full body scan per passenger.

In short there is plenty of opportunity in business aviation - just not the way you may have been conditioned to see it. Business aviation thrives when done efficiently (just ask Walmart), but such instances are rare. Consider the qualities of this non-existent charter company. It:

a) Underpaid for its first two aircraft, since it waited for the right ones to come along
b) Started with two because it didn’t need more to prove its viability
c) Charged more than it cost per hour to run the aircraft
d) Flew an average of 6 hours or more per day
e) Had lots of customers (more than 200 per aircraft)

If you are serious about owning an asset that will actually cost you less to own and operate or actually build a business around something with wings that can actually pay a dividend, then maybe it is time for a quick chat with us. While sobriety checks are critical when dealing with money flowing into airplanes, it is safe to say that global conditions are actively creating the opportunity for “something else.”

We’ll be quick to help you see if you just want to move around as inexpensively as possible or if you are motivated enough to find the solution that lies between the two end points of full body scans vs. the golden chariot.

As long as we didn’t scare you too much and you think you have a few extra questions, why not email us to to set up a time to learn more about how we help jet and fractional owners and others navigate business aviation.

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