NETJETS INC., a subsidiary of
Berkshire Hathaway , is an American
company that sells part ownership or shares (called fractional
ownership ) of private business jets .
NetJets was founded in 1964 as
EXECUTIVE JET AVIATION. It was the first private business jet charter
and aircraft management company in the world.
* 1 History
* 2 Operations
* 3 Taxes
* 4 Fleet
* 4.1 Orders
* 6 Affiliated companies
* 7 Accidents and incidents
* 8 References
* 9 External links
NetJets Inc., formerly Executive Jet Aviation, was founded in 1964 as
the first private business jet charter and aircraft management company
in the world. The founding members of the board of directors included
Air Force generals
Curtis E. LeMay and Paul Tibbets Jr. , Washington
lawyer and former military pilot
Bruce Sundlun , and entertainers and
James Stewart and
Arthur Godfrey , with retired Air Force
Brigadier General Olbert F. "Dick" Lassiter serving as president and
chairman of the board. EJA initially began operations in 1964 with a
fleet of ten
Learjet 23 aircraft.
Bruce Sundlun became EJA president
in 1970, and Paul Tibbets became president in 1976. By the late
1970s, EJA was doing business with approximately 250 contract flying
customers and logging more than three million miles per year.
In 1984, Executive Jet Aviation was purchased by mathematician and
Goldman Sachs executive
Richard Santulli who owned a business
that leased helicopters to service providers of offshore oil
operations. When Santulli became chairman and CEO of the corporation,
he closely examined 22 years of pilot logbooks and began to envision a
new economic model where several individuals could own one aircraft.
In 1987, the
NetJets program was officially announced becoming the
first fractional aircraft ownership format in history. Around the same
time, painted on every
NetJets U.S. aircraft was a three-digit tail
number punctuated with QS, symbolizing the revolutionary concept of
selling Quarter Shares of an aircraft—a feature that is still
representative of the
NetJets brand today.
One of the first quarter-share Owners of the Hawker 1000 was
Berkshire Hathaway CEO,
Warren Buffett , in 1995. He quickly
determined the fractional ownership concept was the future of private
aviation and in 1998,
Berkshire Hathaway acquired EJA and
NetJets soon expanded to Europe and then Russia, and by 2006 was the
largest supplier of business jets in Europe and the ninth largest air
carrier overall on the continent.
In early August 2009 Santulli resigned as CEO and was replaced by
David Sokol .
NetJets Inc. has moved its corporate headquarters from
New Jersey back to its original home in Columbus, Ohio, following the
departure of the company's founder, Richard Santulli.
Marquis Jet from founders Jesse Itzler and
Kenny Dichter. The prepaid
Marquis Jet card allowed customers to
purchase 25 hours of guaranteed flight time on the
In September 2014,
NetJets acquired approval to launch its aircraft
charter service in
China , having worked with Chinese authorities
since 2012 to secure the operating certificate.
NetJets aircraft all wear this paint scheme, and those based in
the US have the letters "QS" painted on the tail number signifying
NetJets sells fractions of specific aircraft, chosen from several
available types at the time of purchase. Owners then have guaranteed
access (50–400 hours annually, depending on share size) to that
aircraft with as little as four hours notice. If the Owner's aircraft
is unavailable for some reason, another aircraft of the same type, or
a larger aircraft, will be provided. Fractional Owners pay a monthly
maintenance fee and an "occupied" hourly operating fee. The latter is
charged only when an Owner or guest is on board, not when the aircraft
is flying to a pick up point, or flying to another location after
completing a flight.
For companies or individuals that require less than the minimum 50
flight hours and the five-year commitment of fractional ownership,
they can buy flight hours in 25-hour increments.
NetJets has been involved in a tax dispute with the US Internal
Revenue Service . Commercial airlines are charged a tax per passenger
ticket to pay for various Federal Aviation Administration activities.
General aviation operations are not charged the same tax. The IRS has
argued that the
NetJets fractional ownership model is really disguised
commercial aviation in some cases, and has assessed
unpaid taxes and penalties exceeding $366 million.
NetJets has sued
the IRS over this assessment and previously paid taxes and penalties
exceeding $643 million. The recent
FAA re-authorization bill contains
a provision that would (temporarily) address the issue by changing the
law to support
NetJets and other fractional ownership companies.
NetJets' fleet is the largest private jet fleet in the world with
nearly 700 aircraft worldwide. Jets in their fleet are classified by
* Cessna Citation Encore
Embraer Phenom 300
* Cessna Citation XLS/Excel
* Hawker 800/800XP
Cessna Citation Latitude
Cessna Citation Sovereign
Cessna Citation X
Bombardier Challenger 350
* Dassault Falcon 2000/2000EX
* Bombardier Challenger 650
* Gulfstream IV/450
Gulfstream V /
Bombardier Global 5000
Bombardier Global 5000 /
Bombardier Global 6000
On June 11, 2012,
NetJets placed the largest aircraft order in
private aviation history totaling $17.6B.
NetJets placed a firm order
for 30 Bombardier Global 5000/6000 jets, 25 Bombardier Challenger 650
jets, 75 Bombardier Challenger 350s, 25 Cessna Citation Latitudes and
50 Embraer Phenom 300s. As a part of this purchase agreement, it also
placed conditional orders for an additional 40 Bombardier Global
5000/6000s, 50 Bombardier Challenger 650, 125 Bombardier Challenger
350s, 125 Cessna Citation Latitudes and 75 Embraer Phenom 300s.
* Executive Jet Management, Inc.: Manages on-demand air charter
services, charter aircraft management, and aircraft management
services. Based in
Cincinnati, Ohio ,
NetJets Aviation, Inc.: Operates all aircraft in the
fleet. Based in
Columbus, Ohio .
Marquis Jet Partners, Inc.: Sells the
Marquis Jet Card prepaid
flight hours package. Became a wholly owned subsidiary of
NetJets Europe is a partially owned subsidiary based in Lisbon,
ACCIDENTS AND INCIDENTS
* On May 2, 2002,
NetJets Flight 397, a Citation 560, landed more
than halfway down the runway in Leakey, Texas. The aircraft overran
the departure end of the runway and collided with trees. A post-impact
fire consumed the aircraft after the crew and four passengers were
able to evacuate.
* On November 25, 2003,
NetJets Flight 632 landed with the nose gear
retracted for undetermined reasons.
* On August 18, 2004, Netjets Flight 961 experienced a landing gear
failure in landing at Jackson, Wyoming. The two passengers and two
crew members were not injured.
* On September 26, 2005, Netjets Flight 669 experienced a landing
gear failure while taxiing for departure in Columbus, Ohio. The two
crew members were not injured.
* On January 5, 2006, the crew of Netjets Flight 391 failed to
maintain adequate airspeed during landing at the Woodruff, Wisconsin,
airport. The right wing contacted the runway; the aircraft departed
the runway and impacted a snow bank. The two crew members and five
passengers were uninjured.
* On August 28, 2006, Netjets Flight 879, a Hawker 800XP, collided
mid-air with a glider over Smith, Nevada, while on approach to Reno,
Nevada . Flight 879 landed safely with only minor injuries on board;
the pilot of the glider parachuted to safety.
* On May 27, 2011,
NetJets Flight 749, a Gulfstream G-200, landed
with the landing gear retracted in Newburgh, New York.
* On July 23, 2014,
NetJets Flight 731, a Gulfstream G-200,
experienced a tire failure upon landing in
Aspen, Colorado .
* On September 19, 2014,
NetJets Flight 322, an Embraer Phenom 300
Nashville International Airport , slid off the runway at
Lone Star Executive Airport (IATA: CXO) in
Conroe, Texas . The area
had recently been inundated by the remains of Hurricane Odile .
Neither the pilot nor co-pilot was hurt.
* ^ "The history of fractional Aircraft Ownership NetJets
History". NetJets.com. Retrieved February 19, 2017.
Hermann Simon mentioned this company in his correspondent book
as an example of a "Hidden Champion " (Simon, Hermann: Hidden
Champions of the 21st Century : Success Strategies of unknown World
Market Leaders. London: Springer, 2009.- ISBN 978-0-387-98147-5 . P.
* ^ p. 58 in: U.S. Congress, House Committee on Banking and
Currency. (1972). The Penn Central Failure and the Role of Financial
Institutions. U.S. Government Printing Office, Washington, D.C. 336pp.
* ^ "Homage to Dick Lassiter". International Air Bahama Crew
Association. Retrieved 10 July 2009.
* ^ A B "Netjets History". Retrieved 5 June 2009.
* ^ "Paul Tibbets: A Rendezvous with History by Di Freeze". Airport
Journals. Retrieved 5 June 2009.
* ^ "Cuts at
NetJets delay expansion plans in Ohio". Retrieved 3
* ^ "Netjets History". Retrieved 3 November 2009.
* ^ "
NetJets wins approval to launch
China service" (Press
release). Reuters. 23 September 2014.
* ^ Andrew Harris. "Buffett’s