Luxury jets are becoming more and more common among high income individuals and corporations in the United States. Luxury jets do not only offer the owner travel convenience but it is also a symbol of a luxurious lifestyle and social status. To understand why private jets are not the best investment, people must first understand the comprehensive costs of purchasing and servicing this luxurious asset.
First, luxury jets are incredibly expensive.
For example, the Gulfstream 550 Jet cost is $59.9 million, the Bombardier Global Express XRS cost is $47.7 million and the Boeing Business Jet can cost from a range of $50 million to more than $300 million dollars. In addition to the cost of acquiring these luxury jets, the owners also have to pay for fixed cost such as hangar cost, insurance and frequent avionics software update.
Annual fixed costs can be as expensive as $1 million. Third, luxury jets also require many variable costs such as crew cost, fuel cost, as well as landing and parking expenses. For every hour in the air, the luxury jet owner will spend approximately $3,000.
As shown below, the costs for acquiring and servicing luxury jets are tremendously big and hard to sustain. Even though it is true that private jet give its owners the convenience and privacy as well as the social status, the cost of a luxury jet outweighs its benefits. Besides, luxury jets are depreciating assets; they do not make any money but its value decreases by age and usage.
Luxury jets carry material value, but reducing global poverty offers immaterial value.
The Millenium Challenge Account, a project to improve agriculture in developing country, only cost around $90 million per year; the Save the Children Foundation annual budget is only $112 million. The cost of a single luxury jet is enough to feed more than 1,500 people per hour for one day.
The number and scale of global poverty seem to be hard to eradicate, but due to the exchange rate between developing countries and developed countries, everyone is able to support this cause. Every dollar counts, for only fifteen dollar, a family of four can be fed for a whole week. It only costs $3.50 to provide clean water for a person, so every hour in the air luxury jet can supply more than 850 individuals with clean water to prolong the life span and reduce related diseases.
– Phong Pham