Reprinted with permission from an article in the November NBAA ShowNew.
All editorial copyright the McGraw-Hill Companies, 2005.

How to Get Airborne in an Eclipse 500

The imminent certification of the Eclipse 500 means that a tidal wave of brand-new very light jets is going to swamp the capacity of owner/operators to get the most from their aircraft. Eclipse has now attracted over 2,350 orders, and even in the initial production phase it will be building four a day. With an eye on this coming boom, several VLJ operating concepts have sprung up around Eclipse's customers. Increasingly, attention is turning to the people out there who don't actually want to own a jet but do want to fly in one. Here at NBAA, Show News talked to the two leading service providers for Eclipse 500 fliers who are following two quite different concepts of operations,

"The VLJ Flying Club is an organization for people who are unwilling or unable to fly an Eclipse themselves." says TAG Aviation USA VP Marketing and Sales Michael Moore. TAG has joined forces with the creator of the Flying Club concept, Rolf Illsley, who has acquired a fleet of 10 Eclipse aircraft with a totally new user concept for the jets. I knew there had to be something clever we could do with this VLJ paradigm shift," Illsley told Show News. "What's lacking in the fractional operations concept is that it's all flying by the hour and we wanted to do flying by the day. That’s much closer to how an owner would think. So I went and looked for the best aviation law firm I could find and got to work."

That firm was Galland, Kharasch, Greenberg. Fellman and Swirsky-a well-known practice in the aviation field. The firm facilitated TAG’s involvement, bringing it on board to manage the aircraft sold by the VLJ Flying Club.

TAG Aviation's Moore explains how the Flying Club concept will work: "A customer will buy a quarter share in an aircraft from Vlj Flying Club Sales Inc., and sign a management agreement with TAG to crew and support that aircraft. Customers buy days of use per year on each aircraft, with four shareholders per jet. Flight operations are self-scheduled, with management and maintenance overseen completely by TAG. All you pay is a fee for that service and the fuel bill.

"The operational base for the aircraft will be dictated by where the shareholders live. I imagine the early emphasis will be on the West Coast. Estimated cost for a share is $500,000, but we are still refining the operational costs." The key discriminator between the Flying Club concept and a fractional operation is that customers here can fly unlimited hours on each jet. A 25% share in the Flying Club equals 50 days of total access to the aircraft. The Flying Club will not pick up and drop off at different destinations – it’s aimed at customers who live near the aircraft and want to fly out somewhere and then come home.

The first aircraft for the VLJ Flying Club is due for delivery in late 2006. With 10 aircraft in its initial fleet, the program will have room for just 40 shareholders at first. "I suspect we'll have a lot more than 40 people on board soon," says Moore. "We are confident in the aircraft and confident that we can provide an operational network. It’s going to be huge."

OurPLANE calls itself the grandfather and pioneer of general aviation fractional ownership. Founded in 1998, the idea was "to give GA pilots access to brand-new aircraft at a fraction of the purchase price and to remove the problem of private ownership with 100% liability protection,” OurPLANE sales associate Gary Kirke tells Show News. Based in Canada, OurPLANE now offers complete fleet access across North America with aircraft such as the PC-l2 and King Air. It will soon be the only fractional operator with an Eclipse fleet. During the 2005 Oshkosh show, OurPLANE announced an order for 20 Eclipse 500s. The first of these is due for delivery in October 2007, although earlier slots can be found if required.

Says Kirke, "A lot, of Eclipse order holders were looking for someone to join up with, so they have sold us their delivery positions with the intention of buying back 100 or 200 flight hours per year. In our program an individual or a corporation can fly the aircraft themselves or we will provide a pilot for them. We see it as air transport for small to medium corporations. The price for an equity portion [17%] of an aircraft is $300,000 and after that it costs you $349 an hour to fly That's the total bill Even' fixed cost has been calculated, hedged and included in that hourly fee. You'll never see another fee.

"If we receive three deposits of $5,000 at any specific airfield, then we will allocate an aircraft to that group. The first aircraft will be delivered to Toronto, and after that we expect operations in New York, Florida, California and Texas.”

-Robert Hewson