Buffett started hawking little-money-down, low rate, quick-approval loans on a lifestyle-changing purchase.
No, America’s wealthiest man isn’t selling subprime mortgages, he has introduced a financing arm to his NetJets unit aimed at helping the well-heeled keep up their luxury-jet lifestyles by loaning them cash to fly on his fleet of 800 planes, which lost a ton of money last year but posted pre-tax profits of $158 million in the first nine months of 2010.
Buffett’s NetJets, which sells air travel by the hour aboard posh private jets and turboprops, yesterday began selling loans virtually on the spot with no outside financing hassles, to help customers climb into their own private planes in “just a few days.”
Sounding a lot like the familiar late-night TV used-car commercials espousing — “Just a dollar and a job is all you need,” NetJets embarked on a possibly risky business model of basically lending to itself, in hopes of offsetting its dismal 2009, in which it had to lay off pilots as corporate business plummeted.
While announcing NetJets Direct Financing, the company said that it would make fast-track loans only to “qualified clients” and not subprime losers. The financing arm can ground Buffett’s recovering corporate jet business should the economy worsen.
A similar strategy failed at Harley-Davidson, whose bottom line and shares suffered last year after its financing operation lowered qualifications, wrote loans to less-deserving customers to churn sales and then got stuck with billions in bad paper when the motorcycle owners defaulted.
The Private Jet Company offers private jet sales & acquisition and private aviation consulting services in major markets throughout the world. Founded in 2005 with headquarters in North Palm Beach, FL and regional offices in Paris, France and Mexico City, Mexico, TPJC has completed over $2 billion of private aviation transactions for individual and corporate jet owners. In addition to assisting clients buy and sell private aircraft, the company works with aircraft management companies to reduce the burden of private aircraft maintenance costs and create income through chartering jets. TPJC also partners with aviation attorneys and tax experts to help clients maximize depreciation, reduce tax burdens and assist in import and export Certificates of Airworthiness.
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