The Essential Luxury for the Super-Rich: Private Jets

Billionaires are often associated with extravagance that knows no bounds. From bidding on masterpieces by Picasso to owning yachts equipped with movie theaters, spas, and even submarines, the realm of the ultra-wealthy is a playground of opulence. Yet, amidst this overwhelming wealth, one essential emerges: the private jet.

The Findings of Forbes

In a fascinating survey conducted by Forbes, 40 billionaires were asked to identify which luxury item they considered indispensable. The overwhelming majority—a whopping 12 billionaires—highlighted their private jets as a crucial part of their lives. What was it about these flying machines that captured the attention of the super-rich?

Right behind private jets in the hierarchy of luxury were other items like luxury cars, smartphones, and second homes. Some respondents even humorously listed their spouses as their greatest luxury. Charles Koch, chairman of Koch Industries and worth an astonishing $67.5 billion, quipped, “Liz for 57 years!” while Stephen Smith, founder of Canada’s First National Financial, expressed his passion for heli-skiing.

However, many billionaires pointed out something even more intangible: privacy. With a private jet, they can escape from the prying eyes of the public, allowing them the freedom to travel without interruption.

Time: The Most Valuable Resource

When it comes down to it, the biggest advantage of using a private jet is time. Commercial flights come entwined with a host of inconveniences: lengthy airport journeys, prolonged security lines, and the unpredictability of flight delays. In stark contrast, a private jet can be operational in mere minutes, offering flexibility that commercial airlines simply cannot provide.

For instance, in Texas, there are 389 public airports, yet only 25 are commercial. This means executives can land much closer to their business destinations, saving critical hours in their busy schedules. Billionaire David Hoffmann, who invests in luxury transportation and real estate, emphasizes this point: “We have a large number of locations, and it would be impossible to reach them all without a private plane.”

Overcoming Logistical Hurdles

For some billionaires, the need for a private jet arises out of geographical challenges. Samir Mane, the first billionaire from Albania, explained that the air travel infrastructure in his region is quite limited. “I bought a jet because we don’t have good connections to many of the countries where we operate.” He elaborated that a flight from Tirana to Sarajevo takes only 20 minutes in his jet, while commercial travel could consume an entire day.

Hugh Chatham, VP of aircraft brokerage CFS Jets, succinctly captures the practical necessity: “Many of these companies would struggle to operate if their executives could not attend meetings across the country on the same day.” Investor Larry Connor further solidified this notion by stating, “It’s not a luxury; it’s a business tool.”

The Price of Freedom in the Skies

Of course, private jets stand as one of the most expensive acquisitions for billionaires. Four respondents in the Forbes survey indicated jets as their most significant expenditures. While jets depreciate at a rate of 5% to 10% per year, the demand for used models saw a spike during the pandemic.

Currently, a basic used jet can set one back around $1 million, while high-end models, like Bombardier’s Global 7500, can reach upwards of $75 million. New models may cost even more, sometimes exceeding $80 million. The Global 7500 features distinct cabin areas designed for work, dining, rest, and leisure. And some billionaires go even further: Roman Abramovich purchased a Boeing 787-8 Dreamliner for about $350 million, while Alisher Usmanov bought an Airbus A340-300 valued between $350 million and $500 million.

Luxury or Necessity?

It’s important to note that not all private jet ownership is simply about luxury. “There is a certain stigma around owning a private plane,” notes Hugh Chatham. “Often, it’s not as luxurious as it seems. These executives travel cramped for two or three hours just to save time and money.”

However, the luxury of owning a jet comes at a hidden cost: the loss of privacy. Apps like FlightAware enable the public to track private flights, often making billionaires feel exposed. As a response, some owners resort to intermediary companies, registering their aircraft under various subsidiaries to maintain a degree of anonymity.

Exploring Shared Ownership Models

Interestingly, not every billionaire opts for full ownership of a private jet. The rise of fractional ownership—where clients acquire a percentage of an aircraft—has gained popularity. This model allows owners a specific number of flight hours per year, making it a more manageable financial commitment.

Billionaire Hoffmann shares that he commonly uses both his owned and fractional jets due to high demand. Some billionaires even favor subscription models, paying a monthly or annual fee to access entire fleets without the burden of full ownership. Samir Mane illustrates this shift by mentioning how he recently sold his used Citation XLS+ for $11.8 million after purchasing it for $10.8 million. Now, he utilizes services like Vista and NetJets without sacrificing comfort.

In essence, private jets serve as more than just status symbols for billionaires. They are critical tools that allow these ultra-wealthy individuals to regain control over one resource that money can’t buy: time.