Once you buy a jet card, flying is as easy as one call or even booking online, but figuring out jet card pricing is another matter
The number of jet card providers has more than doubled over the past decade in part because jet card memberships are an easier way to access the charter market. Via fractional jet card programs and owned fleet operators, you can get a consistent experience flying the same aircraft type in like configurations previously only available via committing to five-year share contracts or owning your own aircraft. It’s no longer one size fits all with programs that start at five hours and ranging up to 100 hours. And it’s not just fixed one-way rates, but now there are now jet cards that use dynamic pricing. There are even programs where you can get both a fixed one-way rate with guaranteed availability and dynamic pricing where with the goal of beating your fixed rate, so in other words, your fixed rate is a ceiling price – you won’t go higher and you might go lower.
In trying to figure out what you are going to pay looking at program hourly rates would seem like the right place to start, and it is. Unfortunately, it is really just a starting point. Below, I have outlined factors that will increase what you are going to pay followed by policies that will reduce it. In case you are wondering, there are 14 elements that can drive your rate up compared to five that potentially can save you money.
1. Federal Excise Tax
Some jet cards promote hourly rates including the 7.5% FET which is charged for domestic U.S. flights and any flight that begins and ends in the U.S. or at any place in Canada or Mexico not more than 225 miles from the nearest point on the border of the lower 48 states. Since some programs include the Caribbean, Mexico, and Canada in their fixed rate service areas, you will have to back out the FET for flights where it won’t be charged or for those who don’t quote it, add it in as applicable per the above.
2. International Surcharges
While many programs offer fixed one-way rates that include Mexico, Canada, and the Caribbean, many carry surcharges which can range up to 20%
3. High-Density Airport Surcharges
Several programs include surcharges for flying into busy airports such as JFK, Newark or La Guardia in New York or LAX in Los Angeles. Fortunately, you can avoid the extra fees by flying to a nearby airport, however, if you don’t want to or can’t, make sure you have read the fine print about High-Density Airports
4. Fuel Surcharges
Another variable is fuel surcharges, which are in some cases adjusted on a monthly basis and are typically charged on an hourly basis and vary by size of the aircraft you’re chartering
5. Taxi Time
Virtually all fixed rate programs add either six or 12 minutes per segment so if you fly a lot of short legs it can add up. On a $6,000 hourly rate, you’ll pay $1,200 in taxi time per flight based on 12 minutes. It can also mean that it makes sense to pay a higher hourly rate to fly nonstop versus a smaller aircraft that requires a fuel stop since that will turn your trip into two segments, meaning you will be charged for taxi time twice
6. Consumer Price Index (CPI) escalators
CPI escalators aren’t prevalent but they are out there and often times they are charged based on the greater of actual government issued CPI or a made-up rate. Since most people buy jet card hours to use in the next 12-24 months there is limited exposure, but 2% here and 3% there can add up to thousands of extra dollars you may not have expected.
7. Segment Minimums
The bane of short flight fliers, segment minimums typically run from 60 to 210 minutes with the time increasing as you go up in size of aircraft. What it means is if you want to fly 10 people from Los Angeles to Las Vegas, you’ll need a large cabin jet that will likely carry at least a 90-minute segment minimum and quite possibly 120 minutes or higher. One area of fine print to ask about is if the segment minimum is inclusive of taxi time. That means if you are making a 48-minute hop and your program charges 12 minutes per segment for taxi time, you will either pay 60 minutes or 72 minutes for that flight base on the answer.
8. Daily Minimums
Some programs have a Daily Minimum instead of a Segment Minimum while others have both, and again, how they are applied can vary. For example, with one program that has a 72-minute segment minimum and a 120-minute daily minimum if you make two 60 minute flights on the same day you are only charged 120 minutes instead of 144 minutes. Other programs charge the higher amount.
A big surprise to new private aviation fliers is that some programs charge for deicing – and in fact, I heard from one subscriber who only found out when he got his monthly statement. Deicing can cost from $1,000 to $10,000 based on the type of aircraft and airport. Airports have different rules about what products can be used and when and where aircraft can be deiced which means prices can vary. If your aircraft was deiced and you show up an hour late, it might need to be deiced again. With on-demand charter, sometimes you pay for deicing twice – once for the positioning flight and then again for your flight. Some programs include deicing. Vendors that don’t include it will tell you it’s baked into the price somewhere – as in there’s no free lunch. If you are doing a lot of winter weather flying it’s something to consider. There are also ways to get around deicing, like bringing an aircraft into a hangar prior to the flight, which could be less costly. If you are with a program that doesn’t include deicing and you are flying on a day where there are freezing temperatures and precipitation, it’s worth talking to your card provider to see if there is anything they can do to safely avoid deicing.
A recent Business Jet Traveler survey showed 52% of its readers don’t order catering, possibly because around 80% or flights are under two hours and also it’s expensive. Most programs either include some basic packaged snacks, soft drinks, beer and maybe wine splits or minis, while some provide a catering credit, although several include higher end catering. If you are doing longer flights or plan your flights around meal times, it’s something to think about.
A large majority of Private Jet Card Comparisons subscribers tell me Wifi is nice but not necessary or just plainly not a factor in deciding on card programs, which is good, because most programs don’t guarantee it while others do, and others will enable you to get a WiFi guarantee by paying a customized higher hourly rate.
12. Initiation Fees, Monthly and Annual Dues
Only a few programs have these, but if you are trying to do a true dollar-for-dollar comparison you need to add up whatever they are charging for the year and then divide them by your projected number of flight hours. For example, if you are paying $20,000 in membership fees and flying 20 hours, you need to add an extra $1,000 to your hourly rate whereas at 40 hours it’s only $500.
13. Peak Day Surcharges
Peak days surcharges range from 0% to 40% and the number of peak days in programs also varies widely. Often you can get around peak-day surcharges by being flexible by a day or two, however, if you have must travel dates, then make sure you are also reviewing specific peak days and surcharges, and adding those surcharges onto your hourly rates for those flights.
14. Interchange Fees
Many programs allow you to upgrade or downgrade the size of your aircraft based on your needs for that flight, however, some charge an interchange fee or provide an interchange rate that allows changing sizes or types of aircraft but charges you a premium. If you are constantly going to be going between cabin sizes, look for a program without interchange fees or make sure you have calculated your costs based on those interchange rates.
These policies will save you money
Now that we’ve talked about all the surcharges, the good news is that there are also some policies that will save you money.
15. Roundtrip discounts
Roundtrip discounts run from 5% to 40% and typically require at least two billable hours for same day returns or two hours per day on consecutive days starting and returning to the same airport. The discounts often aren’t valid on peak days and are also usually limited to 14 hours from the departure of your first flight of the day, the FAA-mandated duty time limit for your pilots.
16. Long flight discounts
If you fly cross-country trips, some programs have long-flight discounts which are either a fixed per hour deduction or percentage based.
17. Hub discounts
A big expense in providing fixed one-way pricing is the repositioning of aircraft that has to be baked into the pie and then averaged out to all card members. If you live in a market like Iowa and fly to Oklahoma fixed one-way rates are like pennies from heaven compared to an on-demand charter where you have to pay for ferry flights. Hub discounts are generally offered if you begin or end your flight at a high volume airport such as Teterboro or Love Field since it’s less likely there will be any repositioning needed.
18. Advance Booking Discounts
While the booking window for fixed-rate jet cards typically ranges from 8 hours to 48 hours, the farther in advance you can book, the more likely your provider can get an aircraft for you that won’t need to be ferried on either end of your trip. To reward you, some programs offer advance booking discounts.
19. Luxury and Lifestyle Partnerships
It’s hard to amortize this into your hourly rate, however, a number of programs have partnerships that offer free nights at luxury hotels, discounts from luxury brands and waiver of membership fees for vacation clubs. While the offers can be viewed as value added, if you were planning to join a particular club or stay in several of these hotels, you can perhaps save thousands of dollars in cash you would have spent.
I always recommend that before you buy a jet card, do your best to map out where you want to go and when. Also, make sure when you are buying a fixed-rate program you review the Primary Service Area – the places your fixed rate will apply. Most programs will fly you, however, you will pay a dynamic rate much like an on-demand charter.
There are some other extra costs – for example – if you want a flight attendant – that’s typically only included on large-cabin jets – or pet cleaning fees, which are typically only applied if needed post trip. If you want to use a non-preferred FBO, again you likely will have to pay for it. On the other side, once you have narrowed down the companies you are considering, it doesn’t hurt to ask if there are any incentives to sign right away.
While I know you want to figure out what you are going to pay, the complexities of private aviation don’t make it easy. I also think it’s important not to fixate on price. Before you buy, spend the time to get comfortable with the providers you are considering. Ask to speak to a senior executive if you have questions that go beyond the expertise or authority of your sales rep.
Take a hard look at what the providers sourcing standards are for both aircraft and pilot experience. Ask to chat with either the Chief Pilot if you are dealing with an operator or the Safety Director or Chief Safety Officer for broker programs. If you are flying into mountain airports or remote airports, ask specifically about protocols for sourcing crews for those flights.
Also, ask about recovery guarantees. One benefit of jet cards should be if something goes amiss your program will get a replacement aircraft without a re-quote as is the case with an on-demand charter.
Lastly, remember, if you are flying 25 hours or more per year with varied missions, there’s a good chance you are not going to find one program that fits all of your needs. View a jet card as a key tool to cover many of your private aviation needs and then fill in the gaps with an on-demand charter.