Fractured Fractionals

Fractional aircraft ownership programs - whereby customers/owners typically buy a "share" of the aircraft via a five-year management contract with guaranteed availability of aircraft - have now been around for some 25 years. While industry pundits continue to debate their true value proposition, the popularity and viability of this business model is no longer in question. In fact, the fractional industry has remained relatively robust, even with the continuing lackluster economy. Still, on average, companies that offer shared aircraft ownership programs have had a difficult time in forecasting demand and maintaining profitability. This is not quite the scenario imagined by NetJets founder Richard Santulli - who, when he first introduced the fractional concept, envisioned thousands of jets owned by tens of thousands of owners - but it shows that the industry is here to stay. Here are some updates on a few of the major players in the fractional space...