Pre-Paid Flight Cards – “What a deal”
Recently it was brought to my attetion that some of the pre-paid charter cards might have built in surprises for the end user. The numbers used in this example are the exact numbers presented to a potential client.
This particular example was a 25 hour card. The card made available by the card company sold for $155,000 plus an additional $1,100 per hour for assorted miscellaneous costs. Whatever that means!
The total cost for the card before taxes comes to $182,500. That is $182,500 for 25 hours before taxes. That equates to $7,300 dollars per hour…so I immediately pictured a Gulfstream of some type. That was completely wrong! The type of plane to service this card is the Cessna Encore!
At AC 360 we keep analytics on all charter rates for all aircraft all over the country, including the Cessna Encore. So we looked up the Cessna Encore to determine just what kind of a deal this potential card user was getting.
It turns out the current average charter rate anywhere in the country for a Cessna Encore is $2,530 per hour.
That means the cost to use the card is 289% higher per hour than any charter operator charges in the entire country without the card!
All it would cost a potential user to save $4,770 dollars an hour over a pre-paid charter card is a phone call to any charter operator. And if you just had to spend that kind of money, why not upgrade the type of aircraft you were chartering to a Gulfstream 4 or a Challengers 604 for $5,000 an hour or less. They will be at least $2,000 an hour less than the pre-paid charter card’s Cessna Encore. Then consider this, the Cessna Encore is less than half the size of the Gulfstream or the Challenger, and its block speed is slower, meaning that the cost per mile is much higher. “What a Deal!”
The per-paid charter card offers no other benefit, not even a baseball hat or a toaster.
If it is just the turnkey factor and the ease of use that you cannot live without…have your secretary, assistant, or any 12 year old call any charter company listed in any charter guide. Then upgrade to a Gulfstream or Challenger for less money, be in a bigger, faster, and more prestigious aircraft with a lot more range. And with the money you saved, take a two week golf vacation in Hawaii…you’ll thank me.
I am sure the pre-paid charter card company offers all kinds of different aircraft through their services. Maybe the Encore I heard about is an unusual case or is a one off, or a mistake. But if the charter card numbers are at the same proportions on all their aircraft as the Encore, and you absolutely have to use a pre-paid charter card, well, I have this bridge I would like to talk to you about!
Erudite Solutions for Business Aviation