The economy of scale does not follow acquisition of a bigger aircraft, which will need a larger hangar, more expensive maintenance, and steeper operating costs. By the same token, if your company does need longer range and more seats, this is an excellent time to make an acquisition.

There’s no debatin g that many regions of the world are going through tough economic times. Keeping a company running under such conditions requires much work to find business and secure it against the competition. Rather than selling a company plane, it’s more than likely a good time to put one to work. The advantages of flying a business aircraft can make the difference between survival and forced acquisition. The secret is to fly smart, not wasteful.

Determining the use of a company-owned or leased aircraft is frequently an agenda-driven exercise. All too often, the desire to have the largest and most impressive airplane on the airport, overrides the practical needs of the company. Or, a buying opportunity may be presented that seems too good to pass up, even if the aircraft doesn’t fit the company’s requirements. Conversely, a slash-and-burn efficiency expert, hired to cut costs and “trim the fat” at a company, will view the flight department as a wasteful extravagance. In all these cases, it’s a preset agenda that drives the management decision; that’s not the best way to run a company.

Every business has its own set of needs, and meeting its travel requirements requires practical analysis. If the firm’s headquarters is located near an airline hub with frequent flights to the company’s destinations, it makes economic sense to use the airlines’ services. However, is it logical to limit the firm’s growth to only those markets served by public transport? Can the airline schedule accommodate the company’s needs or will the employees have to cut short their work to take their flights? What happens if the task takes longer to accomplish than anticipated?

It doesn’t take a lot of contemplation to conclude that a company airplane will solve many problems. Sitting around airline terminals wastes productive time, even with the capabilities of wireless communication and take-along workstations. The fact remains, doing a day’s business via airline can often require three days of travel, simply to arrive on time and allow for contingencies. Yes, we’re saving the firm money, but we’re also wasting a lot of productive time.

A Sensible Approach

Getting back to basics, we need to examine why business aviation makes sense, and particularly as it applies to our individual company. The airlines should be used for pure economic reasons, whenever their services fit our needs. The company plane is an adjunct and not a replacement for public transport. But when it’s needed, it can be priceless.

A company’s flight department is somewhat akin to a standby power generator stationed outside a corporate facility. From a purely economic standpoint, the cost of installing and maintaining that emergency power source is a demonstrable waste. But when its output is needed to keep the offices open and ship the product, it’s worth every penny that’s invested in it. The rest of the building and personnel can’t function without its contribution.

Thus, we can begin our valuation of the company airplane as an insurance policy. It can make it possible to meet the commitments under unpredictable circumstances, kept ready just in case it’s needed. Having it available makes the CEO sleep better at night because if a problem arises somewhere in the widespread operations of the firm, he knows that the aircraft is ready to go.

In lean economic periods, perceiving and seizing an opportunity makes the difference between surviving and going under. The chief advantage of a business aircraft—or perhaps its only advantage—is its flexibility. Being able to respond quickly on the company’s schedule, even changing course in mid-flight, is its forte. If an emergency crops up at a plant in a remote location, the company plane can be dispatched with the people needed to assess and correct the problem. If a client or potential client wants to meet, the company aircraft can make it possible. Being flexible is vital when the business is tough.

The other reason for keeping a business airplane is security. If only the company personnel are on the aircraft, business can continue without fear of disclosure; dispatches and equipment can be flown without question; and long, tedious wait lines in the terminal are avoided. Corporate espionage is an art form among rapacious competitors. A private aircraft is just that—private.

The flexibility of corporate aviation is most useful when the destinations are not located near well-served air carrier points. There are many communities with no or infrequent airline flights, yet with great potential for development. The right business plane can use the smaller airports near these cities, giving the flying company an advantage over less flexible competitors.

Productivity is another critical component of economic survival. The most expensive of a company’s assets and the most valuables are its people. Making the most of their time, particularly the vital ones in highly-placed positions, is its key to operating efficiently. A company aircraft makes it possible to have them back at work the next morning, rather than stuck in a distant city. Moreover, it may be possible to convince the workers and clients to make quick day trips rather than half-week excursions and forestall them, seeking less-stressful opportunities elsewhere.

Beyond Worth

How much is the plane worth to a company? As our analogy of the stand by generator shows, one episode may pay for the asset. Having a highly-compensated executive sitting idle in a hotel or airport waiting room is extremely costly for a company. Hours spent on the road are hours taken away from decisions in the office and staff interaction. And yet, not having top management able to visit company installations on a convenient schedule means those individuals are not as well informed about overall operations. The company aircraft not only saves a valuable employee’s time, it fosters productivity of such people as well.

Using a corporate aircraft wisely, rather than lavishly, requires proper application of the asset. If the average trip length is 320 km, it makes little sense to buy a large-cabin jet to commute between plants. If a company is entering corporate aviation for the first time, it is rational to start small and expand as the need is proven. Not all business aircraft are jets and not all are turbine powered. The Beech Baron or Piper Seneca piston-engine twins, for instance, can serve adequately over stage lengths of a few hundred kilometres. A small cabin size is not as noticeable if the passengers are riding less than an hour. The advantages of pressurisation and higher speed may be foregone if a Cessna Caravan can be acquired and operated for considerably less than a Pilatus PC-12.