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Thirty-plus years ago the fractional jet industry was just a baby. Many theorized that it would never work and was just going to be another flash in the pan, just a footnote in the aviation history books.Fast forward to today. The two largest fractional companies operate over 1,050 aircraft. NetJets, with more than 750 aircraft, is ranked the fourth-largest airline in the world by aircraft operated.
Just a short few years ago, pundits theorized that since the fractional industry was mature, growth would slow and there would not be as many new people getting into their programs. Then COVID hit, and a whole new group of people who always had the financial means became customers.
As many know, once you get accustomed to the convenience of private flying, it is damn hard to give it up. We have heard stories of people stating that the last thing they are going to give up is their ability to fly private, forgoing their yachts and second or third homes if needed. Private flying is a very sticky business. Post-COVID has proven how sticky private travel is, but not necessarily if whole ownership is.
There are plenty of reasons to own versus using a fractional jet share - pride of ownership, knowing the crew, flying on the same aircraft, service issues, and control, to name a few. Corporations will find that some of their trips do not fit well within the fractional model. Flying in excess of 250 hours starts tipping the scales towards ownership. However, this article is written specifically regarding the younger generation of private flyers who use the aircraft for a blend of business and pleasure.
The paradigm shift that I feel could catch many off guard is in the whole ownership model. If this business model continues as it is today, we could see an erosion of aircraft owners who just prefer to rent. There are a couple of factors.
Under-50 Ultra High Net Worth Prefer to Rent Than Own
Research is showing that the younger generation are more inclined to rent than to own. According to a Grok-AI search I conducted, 45-50% of global luxury spending is done by the Ultra High Net Worth under 50 years of age. Grok looked at multiple reports, including a Knight Frank Wealth Report for 2025, as a source, along with several others.
That group's spending goes for yachts, second homes and high-end cars - and we can assume aircraft as well. The estimates are that by 2030 that this group will be responsible for 75-80% of luxury sales.
They just do not want the hassles of ownership. They want to show up at their rental property, get on their rented yacht and enjoy their time and move on to their next thing. They are inclined to lease high-end cars, so they are always driving the latest and greatest.
Issues for Whole Aircraft Ownership
The bigger issue I see today, the ownership of an aircraft has become a very complex operation. From maintenance, crew staffing and hangar are just a few private jet services in high demand.
The second part of the problem is that maintenance events are taking longer to accomplish. We still have supply chain issues with the aircraft sector seeming to be one of the last to recover, partly due to the low volumes and highly technical requirements to build these components. The maintenance shops are running at max capacity with a shortage of talent. The results are longer downtime for inspections. Major inspections that used to take 3-4 weeks are now often 6-8 weeks and the big ones 3-4 months or longer.
While on most airframes these types of inspections are every four, six or eight years, they can become a major downtime for the owners who now do not have use of their assets. Meanwhile, expenses such as hangar fees, insurance, crew salaries, and lease or financing payments persist. If travel is required, they must arrange alternative transportation through a card program or charter.
For a generation that just wants to fly when they want to go, this becomes a question as to, "Why am I going through this?" If they started in the fractional side of the business, they might think back to how simple it was to just pick up their phone or open an app on their phone and schedule a flight. If there was a maintenance issue, it was someone else's problem to fix and get me on my way. There are no 6-8 weeks of not flying due to the plane being down for maintenance. If there were a mechanical issue on a trip, there was someone else providing the solution.
Some management companies can indeed provide this support. But normally it is going to be at retail charter rates, which are higher than the client's direct operating costs. Plus, when considering all their other fixed costs during that period are going to be more than they were paying using their own plane.
Fractional is expensive.
That is a given and there are break points where you are paying a big premium to fly with them versus owning. However, if the trend for greater downtime continues and those fixed costs are added into the life cycle cost, the delta is smaller and to a generation that does not want any hassles, an easier pill to swallow.
Assuming flying 250 hours per year, two full-time crew, a flight attendant, a maintenance person and a management company fee, the hourly costs of a Gulfstream G650 without cost of capital and depreciation is a little over $14,000 per hour. The same 250 hours in a fractional share is nearly the same $14,000 per hour. Throw in a few charters while the aircraft is down for the first 48-month inspection, and the balance will tip to the fractional share. If you fly more hours, then the ownership model will look more favorable. But how many of these people are flying 350-400 hours per year? Specifically, if not being used for corporate use or charter.
Wake-up Call to Whole Aircraft Ownership
My concern for the whole aircraft portion of our business is, if we do not get a better handle on downtime for maintenance events, we will lose clients to a simpler model of travel. The ball is in our court to get maintenance shops to not over schedule so that they can get an aircraft out the door in less time. Our industry must get better at recruiting talent for maintenance technicians as well as pilots. Supply chain issues must be controlled and improved. Exploring alternate PMA parts, as used in airlines, can accelerate the supply chain and lower costs. This is an area that needs some serious attention.
Failure to address these issues is at our risk of a major paradigm shift to a rental industry that is mature and proven.
Mike McCracken is President and founder of Hawkeye Aircraft Acquisitions, a boutique aircraft acquisition consulting company formed in 2014 that serves individuals and businesses interested in buying a jet or private aircraft solution for their personal and corporate travel needs. He has over 36 years of business aviation experience, 28 with a major new aircraft manufacturer on the aircraft sell-side.