So let's look at some figures.
Present rates seem to be aout £25, rising to £30 - £35 in some places.
Assume 500 hours a year is a sensible maximum, bearing in mind briefings and the weather.
At the £25 hour rate, that's £12.500 a year, that's £4,500 below the minimum adult wage, if you're full time.
Say you think a living wage is £20,000. You'd need an hourly rate of £40.
A lot of full-time instructors struggle to do more than 400 hours a year. That would need a rate of £50.
In order to break-even, a VAT registered school ( and most have to be, even with only 1 aircraft) would need to charge you out at £65 (£50 + £10 VAT + £5 just to cover the admin)
Tuition is only a part of the total cost. A 4-seat aircraft operated with due regard to long-term maintenance and eventual replacement costs at least £170 inc VAT to run. That's a rate of £235 before you've paid for non-flying ops staff and attempted to make any profit. How many schools charge this much for PPL training in a PA28 or C172?
If you were to charge this much, how many customers would you lose?
I remember in Economics at college learning about elasticity of demand. We've always assumed that PPL training is quite elastic, in other words, if the price goes up, demand falls. Is this true? Is there proof? Should we as an industry take a step and increase prices to a proper economic level, say £270 an hour and see what happens?
We operate just under £200 an hour, but we're run by unpaid volunteers (though instructors get £25 an hour) on the basis of being a member's club. If we were a commercial enterprise, we'd be out of business at that rate.
TOO