It is no news that High Networth Individuals (HNI) and Ultra-High Networth Individuals(UHNI) fly private whether for business or leisure. In fact, in the last year, reports have revealed that more people –in Africa and elsewhere – from the HNI category and those aspiring to it have begun to favour private jets over its commercial counterpart.
Of course, this is largely due to the pandemic and the disruption it wrought on the travel industry. And as they experience the perks of flying private, it is apparent that more people will stick to it even when the need that brought them there is no longer in the picture.
Does this mean that everyone will suddenly try to own a private jet? Certainly not. But you can expect that more HNIs and UNHIs will look into owning one as the need increases. And it would be more accurate to assume that these people will mostly be concentrated in Europe and the Americas, right?
Actually, no. Not according to a recent Wealth X study.
The study, Spotlight on Private Jet Owners, revealed that while North America accounts for 69% of private jets, it is actually Latin America/Caribbean and Africa that have a higher private jet to owner ratio.
In North America, the percentage of HNI and UHNI that own at least a private jet is 1.4 per cent and 14.1 per cent respectively. In Europe – which has the second-highest number of private jet owners – it is 0.4 per cent of HNI and 5.6 per cent of UHNI. Asia, the third-highest, has 1.8 per cent of its UHNI population as private jet owners and 0.2 per cent of its HNI population.
However, in Latin America/Caribbean and Africa, the story chInges. While these two regions do not have as many private jet owners as the top three, the percentage of owners vis-a-vis the total population is higher than what obtains in the top three.
In Latin America/ Caribbean, you have 23.4 per cent of the UHNW population and 2.5 per cent of the HNI owning a private jet. In Africa, it is 18.8 per cent of UHNIs and 2.0 per cent of HNIs.
Why do more wealthy Africans own a private jet than almost all other regions of the world?
The short answer? VHNWs and UHNWs in North America and Europe do not need to own a private jet to have easy access to one.
This is because of the many available services that erase the need for one such as:
1. Fractional ownership
Here, individuals who need to fly private can buy shares or a portion of an aircraft. Depending on the amount you buy, you’ll have a specific number of hours you can fly that plane. The higher your shares, the more time you have.
This is usually a one-time investment which means you’re under no obligation to renew your part ownership with whatever company you choose to go with after you’ve exhausted your hours.
2. Jet membership programs
This works like any membership program really. Here, travellers pay a fee, either monthly or annually, that will give them access to the available flights the company has, as well as lock in hourly rates for that period. They can then pay for flight time as the need arises.
This is the most popular and traditional option for UHNIs and HNIs in other regions wishing to fly private. It is also advantageous if you are not a frequent flyer.
Traditional charters and charter brokers help travellers get access to their network of private jet operators while offering you available options on-demand. Some of them also have jet membership cards you can purchase if you would be using their services often, while others have a frequent flyer point program.
Charter open marketplaces are also on the rise. Instead of going through a charter broker, this new service connects flyers directly to the charter operators without added membership fees or any other commitments. All you need to do is pick your preferred aircraft and pay for your flight.
This option will allow travellers to book a seat on a private jet that already has passengers. In essence, you’re flying private and enjoying the perks of private travel, only that you’re doing it with other people.
With all these options, it is no wonder that private travel is on the rise in other continents of the world, without a corresponding increase in owning the actual aircraft. The question now is: why aren’t these options easily available in Africa?