Learn how fractional ownership can save you a lot of money!
Just as it sounds, Fractional Ownership means you literally own a percentage of the aircraft. Fractional ownership has become so popular because you get all the benefits of owning your dream aircraft at a fraction of the price. You save a lot of money. You gain many benefits over renting and being the sole owner of an aircraft. There are very few drawbacks.
Here we will be exploring the pros and cons of participating in fractional ownership of the 2-seater amphibious ICON A5 light sport aircraft. We will also explain how you can pay €119/hour to fly the ICON, instead of paying the current going rental rate of €250-€300/hour.
Owning a €399K home is not equal to owning a €399K aircraft. Owning an aircraft comes with many additional costs to factor in including; larger down payment, hanger fee, inspections, engine overhaul, INSURANCE, inspections, avionic subscriptions etc.
Cost can be categorized into three (3): -
Fractional ownership takes what is unaffordable for many people, or perhaps what might be considered as financially irresponsible, and makes it very affordable and fiscally more responsible. Let's take a closer look at the costs to own an aircraft.
1) Purchase. If you purchase an airplane for $399K, a 15% down payment would be $59,850. Sharing the down payment with just four (4) owners would reduce your down payment to just $14,962. Still a lot of money, however, much more affordable. It's also comforting to know that if you sell your fractional share, you would get your down payment back.
2) Fixed Costs. If you bought an ICON aircraft on your own, the Fixed Costs might total €3,000/month. Divide ownership costs between four (4) like-minded individuals and your Fixed Costs are now reduced to about €750/month. Sharing ownership with more people will reduce your cost even more.
3) Variable Costs. The variable cost is for fuel and oil. Flying the ICON A5 aircraft will cost about €29/hour in variable costs.
Contact us for a detailed breakdown of all the costs involved in owning an aircraft.
For the following example, we'll use the numbers above. The purchase price will vary based on the specifications you choose to have.
The ICON A5 certified edition is a new, popular, high in demand aircraft. This is reflected in the rental rates. You'll find the ICON A5 aircraft rents for €250 to €300/hour plus other fees to cover items like rental insurance. For the calculations below we will assume the lowest and most affordable cost of only €250/hour.
Renters cost for 8 hours x €250/hour is €2,000
Owners cost for 8 hours x €29/hour is about €232
Why rent for €250/hour? As a fractional owner you can spend the same amount of money in a month, fly double the hours, and only be paying €119/hour as you'll see below.
The more hours an owner flies, the more the hourly rate drops. For example, if an owner spent the €2,000 a renter would spend, the owner could fly for 16 hours. That's double the time for the same amount of money in a month. 16 hours/month is only costing the owner €119/hour because the Fixed cost gets divided by more hours.
Not only is the hourly rate more affordable for an owner, there are MANY more benefits that a renter would never get, as we will discuss next.
Most often, taking a rental aircraft on an all-day or overnight trip is not permitted because the owner will lose out on rental income. If it's allowed, you have to contend with schedules and pay minimum daily fees to compensate for the rental income an owner would be losing. With a popular aircraft like the ICON A5, it's near impossible to go on an all-day or overnight trip without paying a huge bill.
In a fractional ownership, there are fewer people competing to schedule the aircraft. There's even a clause in the owner's agreement that gives each owner the right to keep the aircraft for extended periods of time at no extra cost. You could schedule the aircraft for a weekend retreat in a Balearic island beachside resort and only pay for the two (2) hours of engine time it takes to get there and back. Not only is this allowed, it's ENCOURAGED.
The ICON Aircraft company sells the dream of taking the A5 on remote trips. This isn't very feasible, or even possible if you're a renter. The good news, this becomes the REALITY when you are a fractional owner.
It can be difficult to rent an aircraft on the date and time you would like to fly because the owner's goal is to rent the aircraft for as many hours as possible to make more money.
Fractional ownership has a limited number of owners competing for the schedule. If there are four (4) fractional owners scheduling, each fractional owner has 90 POSSIBLE HOURS each month!
12 hours of daylight/day x 30 days in a month = 360 possible flight hours/4 owners = 90 possible flying hours, EACH. Even if you have 8 owners, there would still be 45 possible flying hours for each owner.
You can see how reserving the aircraft for a weekend trip isn't an issue. This is why fractional owners only pay for engine time with no minimum fees or extra reservation costs.
You can socialize, ask questions, share experiences, and much more with the other fractional owners in your very own Balearic ICON A5 Flying Club. There's a camaraderie between pilots, especially with members of the same flying club, flying the same aircraft.
Meeting up and social events are a huge part of staying current and being the best pilot you can be. Meetings include topics like, best places in the area to fly, how to leverage software like Skydemon, club housekeeping, and more. Meeting virtually or in person, there's always something valuable to learn from other pilots.
Owning, managing, and maintaining an aircraft on your own can be daunting. Sharing responsibilities with other owners makes the workload much easier. We follow the AOPA guidelines co-ownership club organization and dividing responsibilities. Additionally, members have each other to lean on for help or assistance of any kind.
For a nominal monthly fee, Fly EPT Spain with its pool of certified ICON flight instructors in Ibiza and in Palma de Mallorca, offers to fully manage A5 owner's aircraft, arranging hanger space (you can park it in your home garage), maintenance inspections, engine overhaul, insurance, avionic subscriptions etc. Allowing you to absolutely not worry about anything whatsoever. You just enjoy the flying. We’ll take care of everything.
Fly EPT Spain offers aircraft owners the opportunity to lease back their ICON A5 and allow the flight school's instructors to perform demonstration flights and flying lessons in their airplane, helping to offset costs and earn a return on their investment, even generate a profit. Rented out at €250/hour, even with only 12 hours rental per month, it’s easy to see how a little rental usage can help pay its way.
Above we discussed the advantages of sharing the flight schedule with only four (4) people. That gives each member about 90 possible flying hours each month. This is great, however, it's still a 'shared' schedule. If one of the members likes to fly every Saturday from 8:00 AM to 12:00, the schedule is blocked for the other three (3) members. This is why there are rules/bi-laws for the club. The rules prevent a member from causing 'schedule lockup'. Additionally all members enter the partnership with a clear understanding and even a desire to be fair to everyone.
Renters have the option to not fly every month of the year. Even though owners pay lower hourly rates, they still have to cover fixed costs during the winter months with lower flying time. If you don't plan on flying often, then owning an aircraft will not make financial sense. The 'break even' point is different for each pilot. My personal break even point is to fly an average of 8 hours/month (Ibiza-Mallorca = 1 hour). Without diving deep into the numbers here are a couple of calculations for owners...
4 hours/month = about €267 an hour to cover fixed and variable costs.
6 hours/month = about €201 an hour to cover fixed and variable costs.
8 hours/month = about €168 an hour to cover fixed and variable costs.
An owner still needs to cover the fixed costs during the winter months even if they don't fly. Fractional ownership make this much, MUCH more affordable. The best strategy is to have a monthly flying budget and understand the budget will still apply during the winter season. For example, if you have a €1,000 a month budget, you don't need to constantly concern yourself with the above details.
Contact us if you'd like to take a deeper dive into the cost details and apply them to your goals. We're happy to help.
If you were the sole owner of an aircraft, you can choose the hanger location. If you move, you could move the aircraft with you. As a fractional owner, other individuals share in this decision. If you choose to relocate and move to another area, you will need to sell your ownership percentage to another individual, adhering to the club guidelines.
Fractional ownership is the most affordable way for most people to fly an aircraft if you're flying more than a few hours each per month. Fractional ownership also offers you more flexibility than you will ever see as a renter.
If you have never owned an aircraft, wrapping your brain around all the moving parts might seem daunting until you dive in and gain an understanding. If this is you, please feel free to reach out for a conversation. We're happy to talk about the moving parts and share numbers, calculations and spreadsheets with you.
Don't forget, Fly EPT Spain are always on hand to provide you with full aircraft management services, taking away all the concern you may have about owning your own airplane.
The bottom line is, if you're serious about owning an aircraft, fractional ownership can save you money, time, headaches, and from trying to figure everything out on your own.
The benefits that come with owning an aircraft are truly a great luxury that not everyone is able to experience in their life. As pilots, we can't help our desire to fly. Leonardo da Vinci said it best.
"When once you have tasted flight, you will forever walk the earth with your eyes turned skyward, for there you have been, and there you will always long to return." ~ Leonardo da Vinci
The Icon experience is all about freedom, fun, and adventure, and the A5 is the ultimate expression of those values. Press play, strap in and get ready for the ride of your life.
The Balearic Flying Club provides a pathway to low altitude adventures flying the Icon A5 in the Balearic Islands.
Pilots can access the A5 aircraft through an exclusive membership program, allowing you to explore Ibiza, Menorca and Palma de Mallorca, creating new adventures in the air and on the sea.
Our commitment is to safety while providing a concierge service, offering a complete aircraft management service, a tailored flight training program along with on-going pilot training support using the club's very own Icon A5 certified flight instructors who are ready to train you to proficiency for water operations. Empowering you to enjoy this 2-seater amphibious light sport seaplane experience. Flying low, slow and splashing down on water is what it's all about.
If you love to fly, we'll make it possible ..
Contact us for membership details