We are available for consultation on the subject of aircraft finance

We would like to demonstrate our total cost of ownership model. It takes well-established values from published sources for a large number of variables, including financial, passenger driven and technical factors (some of them are itemized below) and enters them into a model that weights them appropriately and produces simple annualized figures for the aircraft that you are considering. It leaves no doubt as to the affordability of any given aircraft.

We are not aware of any other model that incorporates so many variables in order to produce such a comprehensive and unambiguous result.

Also, we can consult on the esoteric subject of equipment trust certificate (ETC) financing.

Some of the factors that we enter into our model:



  • principal amount
  • prevailing  interest rates
  • type of loan (secured line of credit, mortgage, equipment trust certificate, etc.)
  • term (service life – age of aircraft, typically)
  • credit rating
  • misc. fees
  • taxes
  • insurance

Passenger Driven

  • utilization (miles to be flown )
  • in-flight entertainment and communications (IFEC)
  • catering
  • flight attendant
  • cruise speed
  • periodic refurbishment
  • cleaning
  • security requirements


  • fuel price / fuel consumption
  • maintenance, repair and overhaul (MRO)
  • engine reserves (if on a plan)
  • engine overhaul (if no plan)
  • aircraft management fees
  • landing fees
  • parking fees
  • clearances / airways fees
  • hangar expenses
  • navigational subscriptions

Some thoughts on the general topic of aircraft finance

There is no standard, canonical, financial instrument used to finance the purchase of corporate jet aircraft


  • Airline-style “lease financing” (like ILFC) has never caught on in this segment
  • Large firms have charged aircraft to pools of revolving credit, sometimes even unsecured lines of credit – a move that virtually guarantees overpaying on interest expense
  • Aircraft make excellent security (collateral), as they are easily moved, it is easy to transfer ownership of them and they tend to maintain their resale value in a predictable way, thus, they are well-suited for various types of asset-backed financing
  • Many firms use ordinary bank loans, including “mortgage” type arrangements and secured lines of credit
  • The small handful of banks that advertise in corporate aviation media typically offer ordinary loan financing

The issue of aircraft age


  • Conventional lenders often shun older aircraft, which are now quite abundant and, in many cases, still have long service lives remaining
  • Older aircraft are often sought by smaller firms that can be less creditworthy than traditional purchasers of corporate aircraft (Fortune 500)
  • Their smaller size and lack of established credit, coupled with the age of the aircraft, present the lender with greater risk
  • A financial instrument that could reduce that risk could be a solution

Equipment Trust Certificate (ETC) financing


  • ETC’s are a financial instrument that has a well-established history based on over a century of use, dating back to the early railroads
  • They are a known quantity with known characteristics, at least, in transportation finance circles
  • To the best of our knowledge, there is no other consulting firm that is currently offering services related to ETC financing for corporate aircraft purchases
We are not tax advisors. This is not tax advice. Consult your tax advisor regarding all tax issues.