What is fractional ownership in Europe? Judging by the way the concept has morphed since it started to appear in the continent during the second half of the 1990s, the answer might well be “whatever sir or madam would like it to be today.”
The only really successful helicopter fractional operator is not in the U.S. as one would expect, but rather in South America–or, to be more precise, in one city in Brazil. That city is São Paulo, the financial capital of the wealthiest state of Brazil. With nearly 20 million people, São Paulo is the most populous metropolitan area in South America and, according to some census compilations, the fourth largest in the world.
“What’s the difference between fractional helicopter operations and fractional business jet operations?” asked one fractional sales professional rhetorically. “Well, it’s like comparing a rare tropical orchid with dandelions. The orchid can grow and prosper in only a special and rather rare environment, while the dandelion sprouts up just about anywhere there’s sunlight and water.
As fractional ownership programs grew in size, complexity and number, considerable controversy within the aviation community arose as to their appropriate regulatory structure. The main question was whether they should be conducted under FAR Part 91 or, as in the case of on-demand charter operators, Part 135.
At first glance, the fractional industry, like the alien menace in a sci-fi thriller, appears to be morphing into a menagerie of hybrids. But in reality these hybrids are essentially sales and marketing programs of existing operations, both fractional and charter.
The concept of fractional ownership in the transportation industry is nearly half a millennium old. From the 1500s to the 1800s, it was common practice for owners of trade vessels to use fractional-ownership arrangements.
Executive Jet Aviation owner and CEO Richard Santulli brought the fractional-ownership concept to the business aviation community in the mid-1980s. Santulli created a program called NetJets, selling aircraft in shares ranging from 1/16ths to halves.
According to Aviation Research Group/US (ARG/US) of Cincinnati, the great majority of fractional aircraft share owners are satisfied with their program and plan to renew. According to ARG/US president Joseph Moeggenberg, 82 percent of fractional customers indicate they are satisfied with their current fractional program and 80 percent intend to renew with that same program. provider.
After experiencing a meteoric rise lasting almost a full decade, business jet production this year is anticipated to decline for the third year in a row. Those looking for a silver lining will be disappointed to learn that next year isn’t expected to be much better–nor is the year after that.
Bombardier Flexjet announced its selection as fractional provider to the National Aeronautic and Space Administration (NASA) at a press conference yesterday and introduced a member of the Flexjet/NASA oversight committee, Gene Cernan, Apollo 17 astronaut and the last man to walk on the moon.