A key cost driver for all fractional providers is the use of “supplemental lift,” a fancy term for third-party charter planes. These planes are required for peak travel periods, when many fractional owners demand their entire plane at the same time. Another drag on the business model is plane maintenance. Planes that are up on the rack need temporary substitutes. Thus, on top of maintenance expenses and the opportunity cost of an expensive idle asset, the fractional companies must bear the cost of a fill-in charter plane.

NetJets has done an admirable job turning around their finances lately, and reduced charter usage is a key part. They’ve worked with suppliers to reduce maintenance-related downtime, and have recognized Cessna for its contribution. By borrowing GE’s Six Sigma processes, the companies have reduced maintenance time by four days per jet. That’s a substantial savings to NetJets, when you consider Cessna supplies six of the ten models in NetJets’ light and medium size fleet. Overall, NetJets holds over 600 planes.

NetJets recognized Cessna by conveying the first-ever NetJets Annual Performance Award. Presumably the benefits of the cited achievements will extend to other Cessna-supplied providers, including CitationShares and FlightOptions.

For those considering a fractional plan it’s worth examining your provider’s operating metrics: how many hours is each plane flown annually? This will impact resale value at the end of your term. Who performs maintenance and how are they qualified and audited? For what percentage of my annual allotment should I expect a charter fill-in plane? Despite Cessna’s improvements, the only fractional provider with a guaranteed cap on supplemental lift is Flexjet, which offers no Cessna planes -- only Learjets and Challengers from Flexjet parent Bombardier.

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