Transcript of Tom Haines, Editor-in-Chief AOPA Senior Vice President, Media.
- Slide 1
- Tom Haines, Editor-in-Chief AOPA Senior Vice President,
Media
- Slide 2
- Agenda 1. Realities of ownership Reality check Mission
assessment 2. Finding the right ride 3. The purchase process 4.
Q&A
- Slide 3
- Assumptions Youre not an owner Youve never been an owner Youre
evaluating whether aircraft ownership is right for you.
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- Top three most important things to consider when buying an
airplane: 1. Mission 2. Mission 3. Mission
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- Reality check Are you a good candidate for aircraft ownership?
Investments: Time Money Emotions.
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- Reality check Time Time to fly regularly Time to manage a
potentially large asset Think of it as owning a second home Money
Youll need plenty, and a gotcha fund Emotional fortitude Joy and
guilt.
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- Reality check Did I scare anyone away yet?
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- Mission assessment Be realistic about expected missions Buy an
airplane that meets 80 percent of your missions Do you really have
the time to make weekend trips twice a month? How many seats do you
need? How long will most of your missions be? Most GA flights are
less than 500 nm.
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- Mission assessment Be realistic about costs Can you afford this
particular type of aircraft Financing Maintenance Fuel
Hangar/tiedown State sales tax Are you insurable and at what price
and with what limitations? Are you disciplined enough to have a
contingency fund and to build reserves?.
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- Lets go shopping! Where to look for the right ride Manufacturer
AOPA Online Classifieds Trade-a-Plane (trade-a-plane.com) Aircraft
Shopper Online (ASO.com) Local FBO Local broker, dealer
eBay.com.
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- Shopping Things to consider Ageairframe and engine Features and
capabilities of a model can vary dramatically over the years. A
2005 Cessna 182 is vastly different than a 1965 model Hoursairframe
and engine Average number reported in price guides.
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- Shopping Things to consider Installed equipment What meets your
mission? Always cheaper to buy someone elses work, but it wont
exactly match your needs Airworthiness directives (ADs) Repetitive
One-time.
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- Shopping Things to consider Damage history When, where, how was
it repaired Logbooks intact and complete? Paint and interior
Location.
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- Shopping Whats it worth? Perform an aircraft valuation online
through Vref at AOPA Online Other sources: National Aircraft
Appraisers Association (NAAA) Aircraft Bluebook Price Digest
Remember your mission A bargain twin will eat you alive in
operating costs especially if it doesnt fit your mission.
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- Your ride... 1986 Cessna 182 Average number of airframe
hours3,000 hours Mid-time engine750 hours Upgrade: Garmin 430/530,
XM datalink weather, 3-blade prop, S-Tec 50 autopilot, 7 paint
& interior Vref says $105,400 wholesale; $128,300 retail. Youre
a good negotiator and get it for $110,000.
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- Costs Financing Get pre-qualified at www.aopa.org/loans Loan
Term 5-20 years (depending upon loan size) No pre-payment penalty
Simple Interest Rate (fixed for the life of the loan) Rates range
from 5.69%-12.75% Maximum Loan to Value 85% AOPA works with AIC
Title Services Provide the Title Search Obtain Bill of Sale from
Seller Register plane with the FAA
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- Costs Insurance Hullrepairs or replaces the airplane
Liabilityprotects your assets Two types of Liability coverage
Combined Single Limit (aka Smooth) coverage and Sublimits
Deductible or no? Get a quote to help determine overall costs Well
assume $110k hull, IFR pilot w/ 800 hours,
$1million/$100k/seat--$1,100 per year premium.
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- Fixed vs. Variable costs Fixed costs dont change based on hours
flown Finance charge (recouped with resale) Insurance costs
Hangar/tiedown fees Annual Inspection Variable (or Direct) costs
change based on hours flown Fuel costs Oil costs Reserves Routine
maintenance.
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- Fixed Costs Annual Inspection$1,300Annually$1,300
Insurance$1,100Annually $1,100 Tiedown/Hangar$390Monthly$4,680
Total Fixed $7,080 Fixed per hour 120 hours$59 Fixed Costs: 1986
Cessna 182
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- Variable Costs Fuel consumption14 gph$5.39/gal$75.47 Oil
consumption0.20 qts$5.40/qt$1.08 Oil changes$17550 hours$2.92
Engine/Airframe maintenanceper hour$18 Avionics maintenance per
hour$5 Engine, Avionics Reserveper hour$13 Total variable costs per
hour 120 hours$115 Variable Costs: 1986 Cessna 182
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- Total Costs--120 hours per year Fixed$59 Variable$115 Total$174
Fixed, Variable/Year$20,880 Loan ($653/mon.)*$7,836 Total per
year$28,716 *Partially recouped at resale. Assumes $110,000
aircraft, 15% down, 5.69% interest for 20 years. Total Costs: 1986
Cessna 182
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- Forms of Aircraft Ownership Individually owned (or in a
corporation or LLC) Partnership (Visit the new AOPA Partnership
Program at Booth 653; aopa.org/aircraftpartnership/) Fractional
Ownership Flying Club
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- Check out the airplane Review the paperwork Logbooks complete
and intact Airworthiness certificate Equipment list Weight and
balance Placards FAA-approved flight manual or owners handbook
Thoroughly inspect it yourself Fly it Try all of the avionics,
autopilot, intercom.
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- Check out the airplane Get a thorough pre-purchase survey by an
A&P A thorough pre-purchase survey is equivalent to an annual
inspection Airplane should be in compliance with all ADs Thousands
of dollars for a complex single.
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- The art of the deal Negotiate your best deal Contingent upon
passing the pre-purchase survey Contingent upon clear title.
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- Purchase documents Title search $200 to $400 for most airplanes
A clear title assures that when you own it you actually own it
Consider title insurance Chain of ownership Accident/incident
report 337 report.
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- Purchase documents Sales contract Outlines terms and conditions
Specifies any warrantiesusually none Specifies equipment on the
aircraft Specifies aircraft location and delivery location See AOPA
Online for a fill-in-the-blank sample.
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- Purchase documents Escrow Service can help facilitate a closing
Not always necessary Helpful if buyer, seller, and airplane are not
co- located Helpful if liens must be paid off to clear a
title.
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- Purchase documents Bill of Salesubmit to FAA Aircraft
Registrationsubmit to FAA Retain pink copy as temporary
registration Do not travel internationally on a pink slip Make sure
your insurance is effective on purchase date FCC Radio Station
Licensefor international flying only File with International
Registry for aircraft with an engine over 550 horsepower.
- Slide 30
- Maximizing flight time Business flyingwhats your company policy
and reimbursement? Charitable flying Angel Flight Young Eagles
LeasebackA flight school or FBOs pays you for flight time on your
aircraft.
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- Resources Dont go it alone! Type clubs AOPA AOPA Online.
http://www.aopa.org/members/pic/ownership/
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- Other AOPA Summit Forums 2 p.m. FridayWhat You Should Know
About Aging Aircraft, Room 23 3:30 p.m. FridayHow Successful
Business People Rely on General Aviation, Room 23 10 a.m.
SaturdayTax Benefits of Aircraft Ownership, Room 23.
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- Enjoy! Dont be daunted by the purchase process Dreams and
lifelong memories await you as an aircraft owner!
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- Questions? thomas.haines@aopa.org