It’s been 21 years since Richard Santulli opened the doors of NetJets, having figured out a way to lower the barriers to entry to business aviation by selling fractional shares in corporate jets. Now all sorts of industries that sell expensive products have latched onto fractional shares; the latest are companies that sell specialized manufacturing equipment to factories that need to switch production lines to new products quickly. Whatever the product–high-end real estate, yachts, airplanes, machinery–fractional shares lower the cost of buying an expensive product, albeit only a portion of the product, and attract new entrants who might never afford to buy, operate and maintain the whole product.
The fractional industry took years to take off, but a dozen years ago new companies joined the field and the airplane fractional share market began fragmenting into subsegments. Buyers could opt for shares of new or used jets, turboprops and piston-engine airplanes. Jet cards also became an option. Fractionals spread around the world, too, with NetJets opening in Europe and branching out to a partnership operation in the Middle East. The company is seriously studying the market in China and Club Air One has opened a fractional operation in New Delhi, India.
More In Charter & Fractional
