Jet Charter Review

Several factors go into pricing and quoting a charter:

1. Base Hourly Rate. All aircraft have a basic hourly rate which applies to all flying time associated with a charter. This is usually the published base rate. Many people, by comparing just those rates, falsely determine which aircraft will be less expensive than others for a charter. In fact, many factors go into quoting a charter and every aircraft operator, and their quoting program, quotes differently. In many cases, an aircraft with a higher hourly rate will have a lower total quote for a charter.
2. Fuel Surcharge. Often times the second largest part of a charter quote, this is a differential number that adjusts for fuel price fluctuations. An aircraft’s base hourly rate will remain constant, and the fuel surcharge will fluctuate up or down to accommodate for changes in market fuel prices.
3. Airport Fees or Ramp Fees. Most FBO’s charge a fee for using their facility, services, personnel and ramp space. This fee may range from $25 for a small single engine airplane up to several hundred for a large jet. Often FBO’s will give a break or waive the fee if the aircraft purchases a certain amount of fuel from the FBO. In quoting charters, these fees are either included in a total charter cost or separately itemized. Typically the airport itself receives a portion of the receipts from the FBO’s ramp fees and fuel sales, as one of several income sources to pay for airport operation costs.
4. Overnight Fees. Often called an RON, for Remain Over Night, this covers the cost of housing the crew and aircraft overnight. The aircraft is charged an overnight fee for its ramp or hangar space, and the crew members need hotel and meals in the overnight location. This fee typically ranges from $300 for a single-pilot small airplane, to $650 for a jet and crew. Larger jets with 3 crew members can be more, up to $1200 per night. International RON’s are usually higher, in the $1,200 – $1,800 range.
5. Taxes & Fees. To help pay for the Aviation system services in the U.S., the government imposes an excise tax and segment fees on charters in aircraft weighing more than 6,000 gross weight. This includes most aircraft starting at turboprops and up. The applicable excise tax is 7.5% of the charter amount. Segment Fees are $3.70 for each passenger on each flight leg.

Charter companies quote in different ways. Some quote on an itemized form breaking out each cost item. Others quote one total number that is all-inclusive, or specify what may be additional. Most important is to know what is included in the total quote, and what is not included. Some companies do not include taxes or ramp fees in their quotes in order to present a more enticing number, and then bill those items after the charter.

Comparing only the published hourly charter rates, as in item #1 above, can be misleading. Computer quoting programs are many and varied, and are tuned differently for flight times, airspeeds, taxi times, etc. Some programs add some padding, or extra flight minutes, to cover unexpected extra engine time or headwinds. Published hourly rates are not an apples-to-apples comparison.