Ariel Zilber from NY Post – Reports
Goldman Sachs has abandoned a plan to buy a pricey private jet equipped with its own shower, sources close to the situation told The Post.
The Wall Street giant refuted an earlier report that the bank had planned to add a third private plane to its fleet — and denied that CEO David Solomon had been pushing for the firm to acquire a plane with its own built-in shower.
The source, who spoke on the condition of anonymity, instead explained that Goldman’s idea had been to upgrade one of the bank’s two existing Gulfstream jets with a shower-equipped model.
“There was never an intention to own more than two planes,” Tony Fratto, a Goldman spokesperson, told The Post.
“There was an option to have a replacement plane where a newer model would replace one of the existing planes and a decision was made last year to cancel the replacement.”
Insider reported on Monday that Goldman has considered purchasing a Gulfstream G700 — a $75 million aircraft that has its own shower — as a third jet in its fleet in addition to its Gulfstream G280 and Gulfstream G650ER.
The report added that, in canceling the order for the shower-equipped model, Goldman likely forfeited a big deposit, with one industry expert estimating it was likely equal to 5% of the purchase price, or $3.75 million.
A source close to Goldman denied that it cancelled the plane order as a cost-cutting measure.
Goldman staffers who looked into getting a private jet with a shower decided against the move when they realized that having one on board would reduce the aircraft’s range, according to Insider.
“There was never a plan to purchase an airplane equipped with a shower,” Fratto said, declining to comment further.
Goldman executives made the decision not to upgrade one of its jets last year, according to the source, who spoke to The Post on condition of anonymity.
Earlier this year, Financial Times cited sources familiar with the matter as saying that Goldman was re-examining the cost of private jet trips that were frequently taken by CEO David Solomon.
According to FT, the bank tapped chief administration officer Ericka Leslie to conduct a line-item probe of the company’s expenses, including its private jet flights, which are considered “one of the more sensitive areas.”
“We’re looking at expenses in every corner of the firm, so it’s ridiculous to focus on any single segment or line item,” a Goldman Sachs spokesperson told The Post earlier this year in response to the FT report.
For decades, top bankers at Goldman were loathe to fly on a company-owned private jet — instead opting to assume fractional ownership in an aircraft offered up by Berkshire Hathaway-owned NetJets.
But Solomon’s ascendancy to the CEO position ushered in a new era at Goldman.
A year after replacing Lloyd Blankfein, Solomon decided that Goldman would break with tradition and buy its own private jets after the company’s NetJet planes broke down and left him and another executive stranded in Alaska.
Goldman staffers chafed at Solomon’s use of the private planes for his personal enjoyment, including frequent jaunts to exotic destinations such as the Bahamas and Montana, according to Bloomberg News.
Solomon’s moonlighting as an amateur deejay has also been a source of angst at the investment bank, according to reports.
A Goldman spokesperson insisted that Solomon “continues to work” and “pays for his travel” whenever “he’s away for a weekend.”
Solomon’s stewardship of the bank has come under intense scrutiny, particularly after recent layoffs that eliminated 3,200 jobs — the most extensive round of job cuts since the Great Recession of 2008.
The CEO admitted earlier this year that he should have instituted the job cuts sooner.
Goldman announced earlier this year that Solomon’s pay would be slashed by 30% this year.