Charter management for owners, explained

What a certificate does to the airplane

Charter management means placing your aircraft on an air carrier's Part 135 certificate so the operator can sell flights on it to the public. Your aircraft does not get a certificate. The operator has one, and your aircraft is added to it. That is the first thing to understand, because it means the operator, not you, holds operational control of every charter flight, chooses the crew and makes the go or no go call.

Before the aircraft can carry a paying passenger it goes through a conformity process. The operator inspects the aircraft and its records against its own approved maintenance program, and the FAA adds the aircraft to the operator's operations specifications. Some aircraft need equipment added to meet Part 135 rules. From then on, maintenance follows the operator's program and its intervals, which are often tighter than what you kept under Part 91. The crew must be trained and checked in the operator's program too, even if they are pilots you already employ. Expect the conformity work to take weeks, and expect an invoice for it.

What it does to your calendar

Charter demand peaks on the days you probably want the aircraft yourself: holidays, spring break, the big weekends. The operator earns on those days and will ask you to release some of them. Many agreements have the owner block dates ahead of time, with the operator selling what is left. How far ahead you must block, whether you can pull the aircraft back on short notice, and what that costs the operator are the calendar terms that matter.

The aircraft also comes home with more hours, more cycles and more wear than it left with. Every charter hour is an hour off the engines and a step closer to the next inspection. That is not a reason to say no. It is the reason the revenue math has to be honest.

How owner revenue works, in plain words

The operator sells the flight and collects the charter price. You receive a share of that revenue, typically expressed as a percentage of the rate the operator collects. Out of your share come the direct costs of the flight: fuel, engine program fees, maintenance reserves, and the crew's expenses on the road. What is left is your charter income for that trip.

Against that income sit the fixed costs you carry whether the aircraft flies or not: crew salaries and training, hangar, insurance, the management fee, and subscriptions. Charter income usually covers part of those fixed costs. It rarely covers all of them, and it almost never makes the aircraft free. The right question is not whether charter pays for the aircraft. It is whether the income, minus the wear and the calendar you give up, beats the cost of leaving it in the hangar. For many owners it does. For some it does not, and the numbers should say which before you sign.

Picking an operator, and what to hold them to

The operator you choose becomes the company flying your aircraft, insuring it and selling it. Look at the certificate's age and history, the third party audit rating, the insurance limits, the maintenance capability, and how stable the crew and the management have been. Ask how the operator sells: through its own desk, through the wholesale market, or both, and whether your aircraft would compete with aircraft the operator already manages. Ask about financial health. An operator holding your revenue needs to be solvent.

Our aircraft and pilot standards explain the questions we ask when recommending a trip: airframe age and condition, the crew’s experience on type, cabin fit and the requirements of the route. For an aircraft you own, discuss those same details alongside the management agreement.

Related

• Selling an aircraft, explained
• Buying an aircraft, explained
• The standards
• About CP Jets