Buying to hire out [Archive]

bencoulthard

1st May 2006, 08:57

I've just embarked on my PPL, I was weighing up the price differences between the usual 3 options; owning, part owning or school plane.

Whilst I was at the flight school we got talking about a plane i viewed and I was interested in, the school said i fi got a plane he would be interested in hiring it from me. However the one i looked at was a 50% share and the other guy isn't interested.

They said if I get a plane and put it in the school, they will pay £35 for each hour they put on it, guaranteed 500 hours per annum. This seemed like a decent deal to me, however I am new to aviation and i'm sure i'm missing a few vital points.

They propose I insure, hanger and maintain the plane. They use it for flight school, I use it to do my PPL and I just pay for an instructor and my own fuel.

I have spoken to 2 people so far, 1 said sounds a crap deal to me, the other said yes this sort of thing happens regular sounds fine but get a contract.

I discovered today it needs to be registered as public transport or something and a higher standard of Cof A. I'm not sure what all this entails and i'm finding it hard to unearth information.

Any advice and information anyone could spare would be greatly appreciated as i dont want to end up with a white elephant.

IO540

1st May 2006, 09:14

As someone who has examined this in detail some time ago, the short answer is that I wouldn't recommend it unless

a) you buy an old wreck, and

b) you don't mind it wrecked some more

I have never come across anybody who has found otherwise.

Of course, what I call an "old wreck" may be many peoples' idea of a perfectly serviceable aircraft, and indeed most of UK's GA community have little choice but to fly these.

One example which worked for somebody was a PA28 Archer which was on permanent lease to a school, which was allowed to fall apart to the level where almost nothing apart from the altimeter (and other VFR-mandatory stuff) worked, but the owner had an agreement under which he was able to take it away for a few weeks each year for a holiday abroad and in this way he got a combination of cheap flying and the ability (not normally possible with self fly hire) to take it away for a few days or more.

Yes it needs to be a G-reg, maintained to Transport CofA standards, and insured for the ab initio training. You will no doubt want the school to cover it under its own insurance.

If you can afford your own plane, a much better way IMHO is to put together a small group of solvent people you know and trust, and either buy it together, or you buy it and rent it out to the others. If you don't insure it for ab initio (PPL) training and insist that everybody is legal on the type to start with, but the aircraft can be used for additional training like IMCR and IR, the insurance is pretty reasonable. Insurers don't like PPL training but are supportive of any additional training. This scheme (pure rental) can also have benefits on the VAT front, etc.

No matter what you do, you will never make money. There are too many people in the aviation training scene who are quick as foxes to exploit any opportunity to take advantage of a sucker. A properly managed, properly funded school will buy its own aircraft and maintain it to a decent standard.

But you can achieve cheaper flying for yourself.

bencoulthard

1st May 2006, 09:30

I was thinking about £15-20k, I agree, its not worth buying a sweet piece of kit for a school.

I did a few sums and came up with too good to be true, which it probably is.

500 hours guaranteed at £35 is £17500

So

£17500 minimum income
£ 1500 hanger fee
£ 5000 maintenance
£ 3000 insurance

thats £8000 spare for other stuff and i get to do my PPL at a reduced rate

does anyone think these figures are reasonable, please if you know better then i would like you to :mad: on my fire before i part with my readies.

Morgo

1st May 2006, 09:55

Do you have to pay the fuel for the hours that they fly?

bencoulthard

1st May 2006, 10:03

no, they pay the fuel

dwshimoda

1st May 2006, 10:19

500 hours is probably 25% of an engine, so you'll need an engine fund. It's also 10 50 hour checks, and your assuming nothing untoward is found.

Be aware though, unless it's a busy school, you will struggle to achieve 500 hours, what with WX cancelltions, no-shows, etc. For example, our 172 was first registered in 1973, and has TTAF of just over 4,000 hours - tha't's an average of 121 a year! I know that this is probably not representative, but if you're going to be spending £15k - £20k you will be getting a v. high houred machine, that will need some TLC

If it were that simple, I'm sure most people would be doing it, and why would the school not just buy the plane themselves at those rates, and have an assett?

I think you've already recognise that it may be just a little too good to be true!

Good luck though if you do go for it, and enjoy the flying!

DW.

bencoulthard

1st May 2006, 10:23

even if they don't achieve 500 hours, they still pay for 500 hours

any ideas on what a 50 hour check costs?
or the engine at 2000?

dwshimoda

1st May 2006, 10:38

Typical 50 hour is about £400 to £500 for ours. New / zero timed engine - I believe (not entirely sure though - someone else will have a better idea) is £15k - £20k. You've also got to think about prop time, tyres, oil costs, and a whole host of other things.

It's a very brave school that will guarantee you to pay for time they don't use - there isn't much money to made in PPL training these days, so I'm surprised - will they guarantee it in writing?

Owning an aircraft is nothing like owning a car - don't be tempted to find comparisons...

DW.

IO540

1st May 2006, 10:47

The most common trick, deliberate or accidental, in flight training / leasing in of planes from private individuals, is to "promise" X hours but not achieve it.

A plane that costs £20k will cost rather more than £500 on the average 50hr check - unless it is a parachute with a lawn mower engine on the back :O

It is not unusual for Annuals to cost £5000+ on planes of this type / age / usage (e.g. a Cessna 150/152). To anybody who can add up, it looks ridiculous but it suits the average PPL training operation which has zero money in the bank and lives totally hand to mouth, hopefully with regular cash advances from punters who pay cash for a 45 hour block in return for a 10% discount.

Remember that no matter how clever you think you are, the flying school owner has been around the block 10 times and is way ahead of you. He's already worked it out.

bencoulthard

1st May 2006, 11:09

the price of a zero timed engine is a vital thing i need to know for sure, anyone got a definative price on this?
also how much is the public transport c of a?

IO540

1st May 2006, 11:12

Depends on the plane - £15k anyone?

If the plane is not already on a Transport CofA then forget it. The bill could be huge. Everything that was fitted, for which you don't have the JAR1 or 8130-3 forms, has to be removed (as I understand it). I once looked at this, and the prop (£7000) would have had to come off.

bencoulthard

1st May 2006, 11:27

i've got my eye on a

cessna 152c,
1978,
6581 frame hours,
899 engine hours,
passed uk transport c of a jan 2006

by my reckoning it will need a zero engine in 2 years

dwshimoda

1st May 2006, 11:34

Just another thought - would this not be classed as an income, and therefore attract the interests of the Inland Revenue? If so, that's another 23% - 40% you would have to deduct. (May be wrong on this, but it does seem like an income)

bencoulthard

1st May 2006, 11:37

yeah ive already looked into that, if i do it i'll start a new company to run alongside my current business, then ppl becomes staff training :-) and tax debductable, so not all is bad

IO540

1st May 2006, 12:27

No you can't do that (put PPL training through the business). Not in this case and not in most cases. You must see a competent accountant.

The income may be taxable but if so then so will be the operating expenses (allowable against the income), and rest assured the expenses will exceed the income :O

The creation of a limited company doesn't in itself change the above position. It does clean it up but the Revenue doesn't like arrangements like this, where a ltd co. owns one plane, leases it to one customer... and don't ask me how I know ;) To create a business that will stand up for Revenue (and VAT, if applicable) purposes you need multiple customers, all at arm's length. The Revenue are on a crusade against everybody to do with boats, planes, horses.

The main scenario where a ltd co. is worth doing is where others fly it. Then, if somebody crashes it and creates a huge uninsured loss, the owner (you) should be protected. Provided you acted properly in your capacity as a Director :O

dwshimoda

1st May 2006, 12:36

There's been many threads on here in the past of the ability to set tax against training fees - it just isn't possible any more. Can't be bothered doing it myself, but just use the search function - you'll find that whilst you may think it's a good idea, the Revenue won't allow it.

Whilst your searching, have a look for group share costs. You'll find that, whilst you dont want to believe it, this scheme is not going to make you any money, will possibly save you a little, but will porbably cost you a fortune.

Sorry to put it so bluntly, if you go ahead I wish you every success, and hope you don't meet a painful financial end.

Say again s l o w l y

1st May 2006, 14:10

First off, if you can find a school who'll guarantee you 500hrs a year, then they will soon be bust!

There is no way I'd agree to a commitment like that for even a busy club like ours, especially with something like a ropey old cess-pit.

Buying an a/c to lease to a flying school in order to earn money is a complete non-starter. Leasing may help you to offset some of the costs, but unless you are a maintenance organisation, then there isn't any money in it. Long term there may be, but there can be some disasters along the way.

A couple of our machines are leased in this way from private owners, but they certainly don't see it as a money making scheme and I have made that clear from the start.

One a/c we have we lease with a commitment of 30hrs a month (360 per year) not particularily onerus, but during the winter it can get pretty interesting!

bencoulthard

2nd May 2006, 08:09

Ok so I think its agreed the best i'm going to do is save money on my PPL, I'd really like to know what a cessna 152 full engine job is likely to cost, any confirmed prices anyone?

potkettleblack

2nd May 2006, 08:40

If you are getting £35/hr then what is happening with the rest of the cash? By my reckoning the going rate per hour for a PPL is £125ish based on 45 hours at £5,500 for a package. So Mr Flying School has £90/hr to pay an instructor (say £10-20/hr) and pocket the rest towards his costs such as overheads/marketing etc. Looks like he is making a fair wedge out of this deal, and you need to get his rate up in order to make your numbers stack up and give you some comfort over engines funds etc as mentioned above.

Say again s l o w l y

2nd May 2006, 09:39

So you would get £35/hr, but have to cover all the fixed costs, hangarage, insurance etc.
Doesn't sound like a very good deal for you to be honest. It would mean the other 40-50 quid per hour goes to the school. Hmmm, I think you need to renegotiate the rates a bit there.

An example, we pay £20ish/hr for a 150, but we are responsible for parking and Insurance. Good for both us and the owner. Your deal sounds a bit one sided.

JW411

2nd May 2006, 09:51

Your other problem is what happens if the flying club goes down the pan. The unpaid landing and parking fees are down to you. This happened to me and it cost me £3000 to bail my aircraft out.

FlyingForFun

2nd May 2006, 10:53

Ben,I'd really like to know what a cessna 152 full engine job is likely to costBest to speak to your favourite engineering company for realistic prices. If you don't have a favourite engineering company yet, PM me and I'll put you in touch with a Cessna specialist (although I can't claim to be independant on this one, because I work for the flying school division of the same company).

On a more general note, though, please re-read this thread thoroughly. I think you will find that the grand total number of positive posts, excluding yours, is zero. Take a step back and try to think about that from a neutral point of view - which I know is difficult, because you are very deeply involved in it. I know what conclusion I would draw.

FFF
----------------

charlie-india-mike

2nd May 2006, 11:04

Having been there and done it and got done over in the process, I would say don't go there.

C-I-M

LowNSlow

2nd May 2006, 11:19

I did it once and also would not do it again. As has been mentioned before the hourly rates need to be higher because 500/year is optimistic at the very least. Your aeroplane will probably be treated as the runt of the family if the school also has their own aeroplanes, guess which one will be the last to fly? If they are responsible for the maintenance it will get the bare minimum and on the other hand if you are responsible for it then you will be blamed for the downtime as a reason for not making the mythical 500 hours. I'd advise against it. Regarding the engine I would assume that a good zeroed engine from a reputable source is going to cost you upwards of £12k plus around £2,500 to remove and replace. Plus of course all the other little bits and pieces that can be sorted while the "big" job is being done......

Beware of the taxman as they will be wanting benfit in kind off you. You will only escape this if either you:
a) never fly it yourself
b) have more than one aircraft owned by the company and available to you (a la pool car)
c) have more than one client for the aircraft.

Even the above will not guarantee immunity. You MUST go and see an accountant who is familiar with this scenario or you could have years of grief. Don't ask me how I know. :* :*

IO540

2nd May 2006, 12:09

guess which one will be the last to fly

Excellent point. I recall the CFI explaining to me rather forcefully that such and such plane is not to be flown unless necessary, because they lease it in and it costs them more to fly it as a result, than the rest of their fleet.

As regards Benefit in Kind

never fly it yourself

is not an issue provided you get invoiced at the same rate as outsiders.

However, the Revenue is attacking all these businesses right now. I've had to put up with several enquiries in several years - they do it just for fun, to p1ss you off. They drive £10,000 cars and don't like anybody who they see as "rich". Mine has been properly set up from the start so I have been OK so far. But it has cost thousands in the accountant's fees to deal with it, not to mention my time in drafting long responses, rebutting 5-page attacks point by point. They know that if they keep attacking you and mounting enquiries then eventually you will get fed up with it, strike some sort of a compromise deal, and close the business.

It's not worth doing unless you are buying a new plane for £250,000+VAT and want to get the £43,750 VAT back on it - then it's (arguably) worth setting up a proper business around it, rent it out, etc and pay the ongoing costs, accountancy fees, etc, invoicing yourself, etc, of running it as a company.

For a £15000 spamcan, no way.

Find a good mate or two and share it.

bencoulthard

2nd May 2006, 17:01

Here's the update after making some more enquiries.

My accountant thinks Limited company is the only way to go and he highly reccommends I buy 2 or more. 2 Planes i've seen are available and the right price/hours/condition etc.

If I put these 2 into the flight school they will be the only 2 "2 seaters" so using the other planes 1st isn't really an issue.

Thanks for all the feedback so far, albeit guite negitive. Has anyone ever made this pay or break even?? Or are you just keeping it to yourselves you sneaky dogs?

Tonight i'll sit down with cash flow forecast and see where that leads.

Keep the comments coming.

fishtits

2nd May 2006, 17:11

Lol...

You can bring a horse to water and all that!

Ben - I don't think anyone here is trying to hide anything from you mate - these are guys who have tried to do what you're contemplating with the resultants outlined in the above comments...

However, good luck with the training!

Regards,

FT

007helicopter

2nd May 2006, 18:24

My advise is find somthing you enjoy flying, hire it, park it at the end of the day and walk away until you are ready to fly again - keep things in perspective it will cost you money to buy and keep 1 plane flying let alone 2.

Or take 540 good advice with a few mates.

Disregard your accountants advice totally unless he has done this before, which I doubt.

www.007helicopter.com (http://www.007helicopter.com)

bencoulthard

2nd May 2006, 18:25

oh come come FT, don't you see, all these problems that are arising are a good thing, I need to look at these things.

I have an idea, anyone who has done this and found a problem, rather than just saying don't do it, share with us what problems you had, then we can point and laugh but also you might save others a few quid.

Ben

dwshimoda

2nd May 2006, 18:43

I have an idea, anyone who has done this and found a problem, rather than just saying don't do it, share with us what problems you had
Ben, that's exactly what most of these posts have been doing! People are only trying to help you stop being drawn into something you are patently very naive about. You will make your own decision, but you won't be able to say that you were'nt given plenty of advice beforehand - the fact that it isn't the advice you want seems to be leading you to disregard it. At the minute it looks to me like the school is trying to rip you off, and your accountant is eyeing up many more billable hours - are people who have plenty to gain the right people to take advice from?

It is of no ones interests in here to see another student ripped off (it happens in lots of places, more often than you may think) - in fact, most of the people on this forum only want you to have a good experience, and continue to be a pilot for a long time, hence the time and trouble they take to asnwer you! Flying isn't cheap, and there are very few ways of making it so - if there were, we'd all be doing it!

Something worth checking out for your flying career: Confirmation Bias (http://en.wikipedia.org/wiki/Confirmation_bias) :ok:

I'm not going to post on this thread again now, but again - good luck whatever you decide to do.

DW.

slim_slag

2nd May 2006, 19:40

I've just embarked on my PPLWhat do you do if you don't like this flying lark? Do you know how many people give it up within a year? It's a lot, how do you know you aren't going to be one of them? You are going to spend a load of money if you own a plane, spend/lose a load more money if you lease it to a flying club, and then you might find out you don't even want to fly it yourself. Get your PPL and decide what you want to do with it afterwards, right now your plans should not include leasing a plane to a flying club. That's all the advice you're getting from me, no point in you coming back with some counter, as I've seen it before and there is NOTHING you can say to change my mind.

potkettleblack

2nd May 2006, 19:43

Before I add my 2p worth I need to add a disclaimer that I have never done anything like this before but with my financial hat on here are some thoughts for you to consider:-

- I like the idea of two companies or even a company and an overriding trust owning a company. Trusts are inherently difficult for people like the IR and creditors to break down and get infomration on as they have limited disclosure rules whereas companies are pretty much transparent. Anything that keeps the ownership of the aircraft separate from the main trading entity will give you a measure of protection but not necessarily be cast iron.

- there have been many bankrupt flying schools over the years that have miraculously risen from the ashes as an illustration of how effective the use of company in aircraft ownership can be

- you need to consider how you will offset any risks in order to ensure they aren't deal breakers. Landing fees not being paid (as noted above), aircraft being banged into other aircraft, students injured, some old ladys roof crashed into etc etc. With respect to the landing fees one thought is you would need to draft a rock solid legally binding agreement that is signed between the airfield and the school that rents the aircraft off you. It it likely that the airfield might want you as a signatory. Resist this at all costs, however, if you are pushed then you can try and get away with having the trading company (ie: the one that doesn't own the aircraft) as signatory. Can the aircraft still be impounded? Don't know is the answer so you would need to find this out.

- if you plan on utilising the flying schools maintenance providers I don't necessarily see this as such a downside. Again a proper maintenace schedule could surely be put together and signed. But this needs to be detailed down to how many quarts of oil, who is responsible for what etc. An engineer would need to have input into this agreement if you head down this path.

- be careful with the CAA bits and pieces and that you don't inadvertently infringe on their rules about flying for reward. Remember a PPL is meant to be about cost sharing and not making a buck whereas that is reserved for the CPL'ers, albeit those with an AOC presumably as well. The company/trust structure might get you around these rules. I think there is plenty of information in the private flying forum on the use of companys for aircraft ownership if you do a search. If you go ahead then it might be worthwhile confirming with the CAA (in writing) that the scheme of arrangement complies with the ANO etc.

Thats all I can think of for now. Good luck in whatever you decide.

IO540

2nd May 2006, 20:43

Jesus christ what next.

I like the idea of two companies or even a company and an overriding trust owning a company

What are you planning to crash into? Other than when taxiing, it's very hard to do 3rd party damage accidentally and then even harder without killing the pilot. With a body in the wreckage, they will find the aircraft owner soon enough. Confidentiality is irrelevant; if you want protection from another pilot causing an uninsured loss then a single limited company should do it. Shareholders are not normally liable for anything.

there have been many bankrupt flying schools over the years that have miraculously risen from the ashes as an illustration of how effective the use of company in aircraft ownership can be

Not really. Aviation just has a lot more crooks and conmen in it than most forms of business. In GA training you can defraud a number of PPL students for £5000 each. You can do it totally above board, but there is no need to keep the money, because you won't need it. It won't be there anyway because you used it all up to pay the rent, and your salary. The planes were never owned by the school (of course). No other assets are required for flight training.

The company/trust structure might get you around these rules.

Not until the nearest AOC holder reports you to the CAA and they will be around right away. Which will take under an hour - the speed of rumour around the average airfield is about 150kt. CAA absolutely loves going after alleged AOC breaches. They get good fees from AOC holders.

This kind of "rent to a school" scheme is best forgotten, for all the reasons already listed in this thread.

bencoulthard

2nd May 2006, 22:37

DW quote "You will make your own decision, but you won't be able to say that you were'nt given plenty of advice beforehand - the fact that it isn't the advice you want seems to be leading you to disregard it."

I'm not disregarding any info, its all going in very well and i see where this is leading. I know people don't want to see others scammed and I really do appreciate all this feedback i've caused/received.

I'm still on the fence with this my mind is not made up but if i had agreed with everything people said right away then it would have been a short thread. Imagine............. I'm thinking of buying a plane to rent out...........don't do it....................ok bye

I've spoken to my accountant who is well up on this area (luckily) he explained a few things, his final words were don't rush into anything. He has been my accountant for a while and is trustworthy (that's why he runs my other business affairs).

As for the response about many people giving up within 12 months, well I have wanted to do this for several years and I have just suppresed the desire but it has finally got the better of me. Its not something I just thought of doing on a whim. I will get my PPL and have a plane of my own. If you knew me you would also know I'm a good businessman and I always like to see a good plan come together. If I can fit the desire to do my PPL in with a business idea then that's great. If not its PPL only.

bencoulthard

2nd May 2006, 23:01

Sorry another thing I forgot to add

breakdown of lesson prices

£115 lesson in a cessna 150

£35 avgas
£35 plane hire
£16 VAT
£20 Pilot

that leaves £9 for the school

and yes that's 1 hour engine time not 1 hour from stepping through the door, I think the government and shell are making more than the school!!!

stiknruda

3rd May 2006, 06:52

Ben - I've NEVER leased any of the machines that I've owned to flying schools.

I have allowed safe and trusted friends to play with them for a fair remuneration - the friend benefits from lower costs, I benefit because the a/c is used and all my costs are covered.

There is a lot of talk on here about unscrupulous folk..............

all I know is that there are a lot of used car salesmen in the world, unfortunately a lot are in aviation!!

Stik

distaff_beancounter

3rd May 2006, 09:08

Ben
A very rough calculation for a zero-houred engine for a C152, including fitting would be £15,000. If an engine does a total of 2,500 hours, then it costs £6 per hour flown. So for your 500 hours per year, you have a notional engine cost of £3,000, on top of the other costs that you have already budgeted.
Insurance - what is the policy 'excess' and who pays it? e.g. if there is an excess of £500 per accident, would you or the school bear this cost?
I am an accountant and a PPL, and I have flown regularly for the last 19 years.
I have done the figures - I would never buy an aircraft to lease to a flying school :ok:

drauk

3rd May 2006, 09:18

One thing I really dislike about aviation as a hobby is how negative some people are about things. There is too much elitism in it and too many people saying don't do this, don't do that. If I listened to the advice I received I'd never have rented a plane and flown half way across America when I had only just got my PPL in the UK, nor done the various ratings at the times I did them, etc. A bit more altruism would really help the hobby/sport/past-time develop. So I am not generally inclined to be negative. But on this particular topic, I'm with the the nay-sayers 100%.

I've not done it, but I did look in to it. I've never come across anybody who has made money doing it. And after all, how could you? If it was that great then the school wouldn't want to do it. I've met only one person who has done it who recommended it, but he admitted he didn't make any money, plus he was a FI at the school so he had some advantages in terms of taking care of it, scheduling etc. AND he was trying to sell me that exact aeroplane.

But even if you think you could break even on the plane, or even make a small profit, so what? If you have "business interests", a long-term accountant, the means to buy 1 aeroplane yesterday and 2 today, and so on, are you in such a financial position where you want to make all that effort to save, say, £30/hour on your PPL. That's £1,500 on the whole thing. Is all the time and hassle and risk worth that much? And once you've got your PPL you probably won't want to own an aging 152. So what's the point? Big downsides, (perhaps) small upside.

FlyingForFun

3rd May 2006, 10:40

Drauk almost makes a very good point when he says:One thing I really dislike about aviation as a hobby is how negative some people are about thingsWhen it comes to buying to rent, though, we are not talking about a hobby any more, we are talking about business. And, in business, things are frequently far clearer than they are with a hobby. Either it's possible to make money (in which case the school, assuming it is financially stable enough to borrow the initial outlay, would do it themselves) or it's not.

FFF
-------------

IO540

3rd May 2006, 11:23

I think drauk is right on the mark.

One thing, not exactly on the topic, is that this is a hobby where some financial commitment is a good idea. When one gets one's PPL, one is standing on the edge of an abyss. One has received the official flight training and passed the skills test, but the training isn't enough to allow you to confidently fly from A to B. It never will be because the system is driven by the flight training business which is just that.... a business! They don't get extra money if the graduate finds it useful or fun. So, the PPL scene doesn't have a "support system" for new pilots, which I am sure is a very big reason why so many chuck it in right away.

A big part of the problem is the very poor quality aircraft which is generally available for hire. While many would rapidly point out that they think it is perfectly OK to climb into some piece of wreckage, the fact is that pilot forums are packed with people who will climb into anything that gets off the ground, but most people don't exactly like it. I really hated flying that 30 year old knackered crap, but I accepted it as a temporary situation which would last only a year or so. Passengers like the old wreckage far far less than most pilots would imagine (ever wondered why, after 1 flight, somebody politely turns down your offer of a free flight somewhere?)

Very early on, I started looking around to see what I could get into, to fly after the PPL and also to do the IMC Rating in.

Immediately I encountered a lot of negativity, and some downright crookery. Obviously, a student will tend to ask the people he trusts: instructors. Unfortunately, unless you can get one quietly on your side and he knows what he is talking about, he will be grinding an axe for the school he works in. Or for a mate who owns a share which he wants to dispose of. That was when I first realised that just about everybody one stumbles across working in GA cannot be taken at face value. Almost nobody employed in UK GA is making so much money they can afford to be charitable.

The negativity posted throughout this thread is entirely correct for the specific situation. These leasebacks are a mug's game. However, a lot of people are also very negative about a new PPL buying an aircraft in general, and I think this is much less of a clear cut case. While many people doing their PPLs don't have a clue what sort of flying they want to do (just as, utterly inexplicably to me, the majority of people I encountered on my engineering degree at univ had no idea what they wanted to do in life) there are many who have a reasonable idea regarding their flying objectives, and there is no reason why they should not buy something early on.

The result will be excellent access, with a very low marginal (hourly) cost, which encourages currency. And currency is what it is all about. Lose your currency and you are well down the road to chucking it in. Also currency = safety.

The easiest cases are where the pilot wants to go places, or wants to do aeros.

For touring, your budget directly determines the aircraft capability.

Aeros I know next to nothing about but clearly one can buy some nice stuff to play with.

Say again s l o w l y

3rd May 2006, 12:11

There should be no problem with a newly minted PPL buying an a/c, but the fact is that many are seen as cash cows by the many unscrupulous individuals in this industry.

Unfortunately, many PPL's let their heart rule their head when it comes to buying a/c (Old and New PPL's) and they often end up buying something wholly unsuitable for their actual needs.

I would suggest that people would be better buying into a good share initially (or just continue renting) until they have a bit more experience and understanding of some of the problems involved in a/c ownership.

You wouldn't buy a car without reading a price guide or what to look for article in a magazine and yet I see it constantly with people charging into buying a machine that proves to totally hopeless. I try my best to warn or advise people, but it's sometimes like trying to stop a runaway train.

I spend so much time talking about this to people and then being totally ignored that it doesn't even bother me any more. I try not to say "I told you so" when the poop hits the rotating object, but if people won't listen to experience, then no wonder there are so many sharks out there looking for easy marks.

IO540

3rd May 2006, 13:19

Do you find people buy an old wreck which delivers "maintenance suprises", or buy something that isn't suitable for their intended usage?

Say again s l o w l y

3rd May 2006, 21:35

A bit of both, but mainly it seems to be people buying a/c that won't suit what they want to do with it, ie buying a TB10 for short bimbles, or a C150 for long distance touring!

There are many who have fallen into the trap of thinking that something cheap is a good buy............ And then finding some pretty nasty surprises. Gut reaction and a damn good survey are the absolute minimum requirements for a successful purchase! Not rushing in because it looks alright, but hasn't had the spar mod done and nobody checked to see if it was necessary when looking at that type.

bencoulthard

3rd May 2006, 21:37

I decided early on that anything I buy will get an engineers inspection. insane not to

just spotted this

http://www.cabairaircraftsales.com/rentback.htm

stiknruda

3rd May 2006, 21:44

Having read drauk's excellent post and then seen that the last poster was Ben, I have come to the conclusion that Ben can write but not read !!:ugh:

bencoulthard

3rd May 2006, 21:48

that's just plain/plane:) nasty

englishal

4th May 2006, 05:49

I would consider it assuming the following:

The flying club contributes towards routine maintenance and required checks
The flying club pays for fuel used (of course)
The flying club provides free parking / hangarage
The flying club pays all home base landing fees
The flying club is responsible for all fees incurred by their students
The flying club pays for insurance and will pay any insurance excess
The flying club pays for all repairs above normal wear and tear (spilled coffee, ripped seat covers, bust trim, flat spotted tyres etc....) casued by their students

Sounds fair to me.

LowNSlow

4th May 2006, 07:24

This line from the Cabair ad sums it all up:

It also gives the owner an opportunity of receiving a revenue which can be used to assist in covering some of the costs involved in aircraft ownership.

My bold / underline / italics.

bencoulthard

4th May 2006, 11:23

On another note, a 50% share i've been offered, £200 per month each.

I pay £115 per hour lesson right now.

If I had this 50% I'd pay £22.50 for an instructor.

£22.50 instructor
£35.00 fuel
£ 9.70 landing fee

£67.20 hourly rate total assuming 1 hour lesson

that's £47.80 saving so if I had 5 or more lessons per month i'd be saving.

wet wet wet

4th May 2006, 12:08

Ben

It's important to appreciate that aircraft ownership involves both fixed costs (that you incur even if the wheels never leave the ground) and flying costs that arise out of each hour flying. Your £200/month will only cover the fixed costs (insurance/hangerage/annual check etc). The hourly costs not only include the fuel but engine replacement (say £6/hr for a C152) and maintenance (50 hour checks), say £10/hour. So you need to assume another £16/hour cost on your figures. Then there is other wear and tear costs, e.g. tyres which will take a hammering when you are doing circuits. Remember everything that is aircraft related costs much more than you would expect, even replacement light bulbs are a significant expense!

Bahn-Jeaux

4th May 2006, 12:10

Are you the Ben Coulthard who runs Sweeper Hire?

Not been personally involved with any form of aircraft ownership but do know that my current school leases all of its aircraft on the same sort of basis that you seem to be wanting.
I dont know what terms and conditions these are operated under but it obviously works out for somebody as they have been on the school now for some years.
I cannot offer any advice yay or nay but offer my observation that it is possible.

bencoulthard

4th May 2006, 14:27

That's me, who are you?

IO540

4th May 2006, 15:01

A share is a very good way to cut flying costs and/or get into a plane of reasonable quality, but again there is no free lunch.

1. You are liable (to the extent of your % shareholding) for all maintenance costs, and big-cost suprise items are normal on old planes

2. There are botchas to watch for. People sell their shares for a reason and they aren't likely to tell you if the reason is for example advance knowledge of a major expense, or a dispute within the group. You have to really know and trust the rest of the group.

potkettleblack

4th May 2006, 15:29

2. There are botchas to watch for. People sell their shares for a reason and they aren't likely to tell you if the reason is for example advance knowledge of a major expense, or a dispute within the group. You have to really know and trust the rest of the group.

Ain't that the truth! Also if you need to sell your share be prepared for a long wait. I have recently started looking for a share to do some hour building and one thing that has basically put me off is that many of the shares have been on the market for well over 6 months meaning that when it comes time for me to move on I could be stuck having to pay the monthly fees or take a considerable loss to get rid of it. So it is starting to look like a trip over to the US is going to be the easiest and least painful way to get hours.

7gcbc

4th May 2006, 16:07

Ben,

Outstanding effort and achievement on the sweeper hire thing (gods own google) but slow down on the aircaft thing, my suggestion is to just do the PPL at rental rates, (if you are indeed fed up of the GBP rates , then wait a few months , save and do it in the USA), but buying an affordable , marginal clapped 152 for PPL , mate , you're going to end up learning the hard way, and unless you have capital to burn, then I'd listen very hard to what people have said here.

do the PPL, get it over with, decide what you want to do, then buy/share something "interesting" like a moth or a cub and maybe a year and a 100/200 hours or so later, a pitts or something like that, then you can have enjoyment and income (albeit small) at the same time!

trust me, the PPL is the least expensive thing you will ever do in this game :D

FlyingForFun

4th May 2006, 21:09

Owning a share sounds like a much better way of doing things!

Be cautious, as others have said, but if you can find your way into a successful, friendly and honest group, it's probably one of the best types of flying around, because as well as the financial benefits, you also get a group of like-minded people to sit in the bar and talk to about your aeroplane, and to go flying with once (or even before) you get your license.

FFF
-----------------

bencoulthard

4th May 2006, 22:17

the group I found is as good as you could want, 50% so can you class 2 people as a group? the other guy is an old retired fella and availability is great, the other guy is selling to fund his commercial school fees and the plane is the tidiest 150 ive ever seen with only 4000 hours frame and just over 200 on the engine, new paint and plenty kit to do IF. and night etc

yes there are costs but i think it would be hard to own a plane and pay less with such a good machine with such low hours

englishal

5th May 2006, 05:56

There are certainly cheap ways to fly. I fly a 4 seater, which cruises comfortably at 95 kts. I share it with 3 other older gentlemen, who each own other aeroplanes, including some fun stuff (Yaks, Aerobatic biplanes, etc....).

The plane is around 25 years old but has just benefited from a complete re-build and is effectively a new aeroplane with 200 hrs on the engine. I paid under 10k for the share and first years insurance etc.....I fly from an unlicensed airfield and don't pay any landing fees. As a resident I can come and go as I please, even after the airfield has "shut". We pay £20 each per month hangarage and £40 per hour in fuel and split all other bills. Normally the annuals are taken care of by the excess in the fuel (billed by hobbs). It also helps that one of the group members is an engineer :)

The other chaps are always happy to fly with me and to go on adventures. As they are retired, they are nearly always available and they are also happy to take me on adventures in their aeroplanes, and hopefully I'll get to do a bit of free (or very cheap) aerobatics this year, with the unofficial tutoring of an experienced aero's pilot.

As far as availibility is concerned, it is excellent and is available 90% of the time.