How to Choose an Aviation Management Company

February 2, 2016

How to Choose an Aviation Management Company

According to an article in the Business Journal, “Among S&P 500 companies, business aircraft users grew revenue at more than three times the pace of nonusers, and grew net income more than twice as fast, coming out of the recession, according to a 2012 study by NEXA Advisors for the National Business Aviation Association.” This means that owning a corporate aircraft can be an investment, one that pays off for years to come.

But prospective buyers quickly recognize the complexities that come with aircraft ownership. Keeping track of maintenance, pilot recruitment and training, billing,  and FAA regulations can seem like a fulltime job. That’s why many corporate owners choose a reputable aviation management company to take care of the details. The question becomes how to choose the right aviation management company. 

First, assess your company’s mission. Will you need to put the aircraft on a charter program? Are you interested in leasing out the aircraft? Then you’ll need a management company that can specifically address those goals and that has a proven track record of safety. Don’t be afraid to ask for audits, if applicable, and for client referrals, which may be one of the best ways to determine if the management company will be a good fit. 

And if there’s a management company that’s willing to work with you to achieve the corporate aircraft mission, then that bodes very well for the selection process. Be wary of management companies that quickly quote a fixed monthly or yearly rate without getting to know the client and the airplane; there’s simply no way to determine the relative cost of management without some upfront work. 

According to Jeremy Cox, vice president of JetBrokers, a Chesterfield-based company that brokers aircraft, “When it comes to choosing the right aviation management firm, the terms ‘cost savings’ or ‘best price’ have no place in the selection process.” Mr. Cox believes that “those savings mean some sacrifice to safety, which is not acceptable.” Naturally, safety should be of the utmost concern. Period. No exceptions. In this instance, Mr. Cox is correct. However, there’s no evidence that suggests saving clients money automatically translates to compromised safety. Essentially, that’s a broker’s way of justifying inflated costs, so be wary of that too. 

Yes, contracting with an aviation management company – like everything else in aviation – is not “cheap” but neither does it have to be unfairly expensive. With the best aviation management services, you get what you pay for: security, peace of mind, and smooth running aircraft that allows you to do business on your schedule. After all, that’s the dream of corporate aviation. 

A breakdown of the aviation management selection process: 

1. Do Your Homework: Have a few companies for comparison 
2. Understand your company’s mission. Will you need to charter, etc? 
3. Carefully assess the management company’s response to your inquiry:
1. What information / audits are they willing to provide?
2. Do they have client referrals? 
3. Are they quick to quote a fixed rate without determining the client’s specific needs?  
4. The best aviation management companies will not necessarily be “cheap” but will provide a fair industry price for their services

Quotes and source information originally appeared in “How to: Choose an Aviation Management Company” by Jeremy Nulik: http://www.bizjournals.com/bizjournals/how-to/growth-strategies/2012/12/how-to-choose-an-aviation-management.html