Private jets in China
With over one million millionaires, the Chinese private jet market has huge potential for growth.
USA private jet company NetJets recently announced a Chinese partnership with Hony Capital and Fund Funj Investments. The new venture will be focussed on providing NetJets’ aircraft management services to the Chinese market.
Owned by business giant Berkshire Hathaway, NetJets’ core business in the USA and Europe is offering fractional ownership of its private jet fleet and private jet cards.
Fractional ownership is a contractual arrangement by which the private jet customer buys a share of an aircraft from the management company. The minimum is 1/16th of an aircraft, which equates to 50 flying hours per year. In addition to this expensive initial outlay, there are many other extra costs including yearly management fees; monthly operational charges; and airport fees.
The aircraft management arm of NetJets is a different business offering, called NetJets Executive Jet Management.
This part of the business manages aircraft for other, third party aircraft owners – not the aircraft that are part of the company’s fractional ownership fleet.
When a corporate or a high net worth individual buys a private jet, they need to appoint a company to manage it. This company looks after the aircraft’s engineering; pilots; flight planning; admin; and other ongoing management requirements.
At PrivateFly, the vast majority of our suppliers (99%) are aircraft management companies (also called aircraft operators).
NetJets competes well in the aircraft management market in the States and more recently has launched in Europe. So it’s no surprise they are also entering the Chinese market with this part of their offering. It’s a low cost entry point for them.
What is the difference between fractional ownership, cards and charter?
Fractional ownership: You buy a share of an aircraft (lowest is normally 1/16th which equates to 50 hours per year). Customers are able to exchange hours across the fleet of NetJets aircraft, for example 1 hour on a small jet = 30 mins on a large jet.
Cards: You buy a block of hours (minimum is normally 10 hours) and must use them up within the year.
Charter: This is what we offer our customers at PrivateFly – using spare capacity on owner managed aircraft. This is generally the most cost-effective and flexible method of flying by private jet.
For a personalised quote on a private jet charter in or out of China, contact our 24-hour Flight Team.