How an Aircraft Partnership Agreement Works

Aircraft Partnerships has become increasingly popular over the last five years or so. Airline Companies are constantly looking for new ways to reduce operating costs and increase revenue. Partnered aircraft share is just one of many ways they are being innovative and that is why more companies are choosing aircraft partnerships over traditional fractional or ownership flight hours. Why does this trend continue?

There are a number of factors that make jet partnership an attractive option. First, aircraft are generally more economical to operate than either fractional or ownership. Second, aircraft partnerships offer a simple and straightforward business model that has been successfully duplicated by thousands of companies all over the world. Third, aircraft ownership can be expensive. When you add up the cost of aircraft ownership, routine maintenance, hangar space, operator's fees and the high cost of oil, it comes to an expensive expense that only a large corporation or government agency can afford on a regular basis. Lastly, aircraft partnerships typically require little or no upfront operational cost which greatly lowers the overall cost of ownership.

When an investor flies with a company that shares aircraft ownership, it means that he gets all the advantages of the lower per hour charge that is shared with other shareholders, but without having to buy the plane or pay the extensive maintenance fees. In exchange, the shareholder is able to maximize his or her profits while minimizing the costs associated with airplane ownership. When an investor flies with a company that owns the planes, the company may have an arrangement that allows him to make a profit based upon how many miles he flies with them versus how many miles he would fly with another company that does not share planes. In addition to the benefits above, an investor also gains access to the company's fleet of airplanes at a lower cost than with a partner that does not own a stake in the operation.

The primary benefit of aircraft partnerships comes from the potential for one partner to purchase a significant portion of the total fleet if there is significant growth in sales. Since there is little or no start up cost associated with an aircraft partnership, an investor will be able to expand his or her own footprint quickly. The number of potential aircraft partners is nearly unlimited, since most corporations will readily sign on with multiple partners in order to stay competitive and ensure their own future success.

There are several potential drawbacks to an aircraft partnership that an investor should be aware of before committing to one particular company. For example, flying clubs typically require monthly meetings and quarterly meetings to discuss and monitor the performance of the company's pilots. The main drawback to flying clubs is that they do not provide the personal contact that a larger company may provide. Private flying clubs typically allow only six passengers to fly at a time, which limits the potential growth and profit potential of the partnership. Also, most flying clubs require a significant initial investment which most investors would rather avoid since most pilots begin their careers with much lower starting salaries than pilots in a private company.

The private jet travel clubs provide an excellent opportunity for an interested entrepreneur to meet and work with other great minds in the industry. The best pilots and businesses will work well together because they share a common vision for success. In the long run, such agreements may provide a much higher return than investing in multiple piloting aircraft. Before making an agreement, however, it is vital to determine whether the business will be better served by investing in a single aircraft partnership or multiple aircraft partnerships. To get more enlightened about this subject, click this link: https://en.wikipedia.org/wiki/Business_jet.