Economic crisis - flying and plane ownership

[vanHorck]

Of course we had the fuel going sky high
Then there was the credit crunch in the USA and Northern Rock in the UK
This weekend we had the B&B a well as the Fortis collapses with governments stepping in left right and centre to try and prevent a meltdown

How does it affect you?

Are you a SE owner?
Are you a ME owner?
Are you a private pilot?

What are you thoughts?

I am a ME owner and although I've not put a stop to my flying, it seems much more often than before when I think of flying, the money side comes into my mind and I end up not flying.....

Any comments?

[Rod1]

I moved from an airways equipped 1978 AA5B to a glass cockpit brand new MCR01 I built myself. I am saving £10,000 plus a year and travel faster, short strips etc. Had I not jumped I would be restricted in my hours as I would be struggling to afford it. As it is I have no problems and the market for VLA type aircraft is very strong.

Rod1

[IO540]

I would hope that the fuel price rises have caused at least some pilots to take a second look at that strange red lever which their last instructor told them to never touch otherwise they will fry the engine :)

That one move is worth about 30% off one's fuel bill. The problem is that some decent instrumentation may have to be fitted: an EDM700 or similar, and a fuel flowmeter. That's a few k.

Flying a little slower also helps, disproportionately.

Personally I carry on as before, while squeezing every last drop out of my engine by very very carefully setting it to 25F LOP for each different stage of flight.

[scooter boy]

IO540, I echo your sentiments re leaning. I did Plymouth to Gloucester this morning and ran at 65% LOP best economy cruise as opposed to 75% ROP best power cruise. The trip took me 3 minutes longer and I saved between 3 and 4 usg.

I also buy pretty much all the avgas I burn in my Mooney in the channel islands - saves approx 30% of cost.

My Robinson 44 burns expensive mainland avgas but Plymouth has always been keenly priced for fuel and I am lucky to have them close by.

About the best decision I ever made was getting Monroy long range tanks installed in my Ovation. I can tanker 10h or so endurance with me if I run economically. The CI trips are also very worthwhile for maintaining currency.

The credit crunch has not hit my business (except in the increasing cost of moving around by car, helicopter or plane) and although the bank are encouraging me to sell my Mooney to lift a bit of my debt burden I will only do so if I get offered the asking price.

Rod1 - I had a Europa which like your permit aircraft was fast and economical. It was wonderful cheap flying and although I miss it I could not have used it for much of the fixed wing flying I currently do (night/IFR/v long range). Great fun though if you can pick when to travel.

SB still smiling (through gritted teeth)

[Squeegee Longtail]

"I am a ME owner and although I've not put a stop to my flying, it seems much more often than before when I think of flying, the money side comes into my mind and I end up not flying..... "

That's because you're Dutch!! (ie. Toight) :}

[Shunter]

Couldn't give a toss about the credit crunch because I don't need credit. Spending more on flying than I ever have and loving every minute of it.

[IO540]

Yes I must agree that this "credit crunch" business is massively over-egged. How many people are taking out an overdraft to pay for their flying, and then have the bank call it in?

[robin]

Well, I've told Mrs Robin that because of the credit crunch, there is no point in selling the toy. We have to hold on to her until the financial climate improves sufficiently for buyers to start crawling out of the woodwork.......

Mind you Mrs Robin might have a bit of value if I could find the right Internet Dating website......

[IO540]

If she is attractive, Mr Robin, then any dating website will do just fine ;)

[Gertrude the Wombat]

Hire charges are going up ...

... must have a word with my clients and put my rate up :):):)

[Fuji Abound]

The credit crunch has not hit my business (except in the increasing cost of moving around by car, helicopter or plane) and although the bank are encouraging me to sell my Mooney to lift a bit of my debt burden I will only do so if I get offered the asking price.

Do not under estimate the impact.

It is early days.

However the fallout from the financial sector will appear in terms of mortguages costing significantly more as peoples fixed rate deals expire, employment within the sector will be hard hit causing an increase in unemployment and taxes will rise to meet central government costs. Worse, much worse is to follow. I hope the worst effects of what is taking place never come to pass but do not under estimate how tenious we are.

The barometer is slowly falling. Most were saying a few weeks ago, things dont seem too bad. John Lewis, a long time sound barometer of the retail sector, have for the first time reported the sector is getting tough. Finishing trades in the building industry are still busy as projects complete over the next few months, but the ground workers are already reporting work is short.

Keep a close eye on the barometer, it is falling, you might not yet have noticed, but watch out the pace doesnt gather.

[eharding]

Credit crunch...housing crash...nightmare.

At the start of last year, having been lucky enough to celebrate my 40th year spending 12 months (and all my cash) at the airfield doing nothing but flying, I was strongly tempted to sell the house, buy a Sukhoi and a caravan, park both at the airfield, and continue to live the dream for another couple of years.

As it happens, I went back to an office job, and try to feed the flying habit out of a salary...but after 18 months in an office, I'm convinced I made the wrong decision....you only live once, and what with the housing price collapse and the price of avgas, it's going to have to be the Pitts and a tent rather than the Su26 and a caravan.

Anyone got a tent they can lend me?

[IO540]

I don't think the house price collapse affects anybody who bought a house to actually live in, and can afford to pay the mortgage (if they have one). And if one is moving up in the housing market, one benefits from any price collapse. It just feels psychologically unattractive....

A lot of people over-stretched themselves. The mandatory Mitsubishi Shogun (or whatever its present-day version) and the corresponding lifestyle, financed by a 2nd mortgage.

[wsmempson]

In terms of central London housing in the nice (expensive) bits of town, the price adjustment is happening pretty fast and promises to be brutal. Below £12 miliion (above which is the province of the uber-rich, and life continues as before) prices are down by 15-20% and promise to continue south. By the end of the year, house prices look likely to have fallen as much, in percentage terms, as they did in the three years of 1990-93.

However, given how steeply prices rose between 2005 and the end of 2007, even if prices fall by 50% from the peak of the market, this will simply put prices back to where they were in 2005. Thus, the people who will actually be in risk of negative equity will be those who bought with huge mortgages post summer 2005.

If I look at the demographics of the three flying clubs of which I am a member, I don't see many aircraft owned by under 50's or people who might have bought 'starter-homes' recently so, in a weird sort of way, I reckon the GA scene is curiously insulated from the current economic downturn.

More of a threat to the values of Cessna/Piper/Socata, 30 year old VFR tourers is the arrival of the modern generation of LSA from eastern Europe, which are nicer to fly and cheaper to run.

4 Seat IFR tourers are perhaps likely to remain a bit more robust, subjetc to the residual values and longevity of Cirrus's products.

[Pace]

10540

>I don't think the house price collapse affects anybody who bought a house to actually live in, and can afford to pay the mortgage (if they have one). And if one is moving up in the housing market, one benefits from any price collapse. It just feels psychologically unattractive....<

A big problem has been with "buy to let" where loads of people bought on borrowed money thinking that letting and the forever increasing house prices would allow them to build a portfolio of houses on borrowed money.
Spending more than you have got and encouraged by the financial institutes.

I am lucky I get other people to pay for me to fly their lovely machines well at least I think they are paying me until I dont get paid ;-( as has happened a few times.

I feel sorry for PPLs who have to dig into their pockets at a rate of £120 per hour and it is getting worse. More regulations more costs and fuel which is like liquid gold.

Gliding is sounding more attractive ;) especially as I can fly IFR in them. (only joking) Maybe a little engine for when theres no lift?

But then who knows as governments are prepared to pay billions to support the financial industries they may do the same with aviation.
Think of it no more landing fees, subsidised aviation fuel. Tax free aviation training ..........................

Pace

[PompeyPaul]

I'm affected by the "credit crunch" though. I hold savings in shares and have effectively seen them wiped out over the last couple of months.

I now fund everything from wages. Thus I have less cash to go around. Don't have a loan, a credit card, or even want any of that stuff. Still feel much poorer though. Although I'd probably go without luxuries like food before I stopped flying :ok:

[IO540]

More of a threat to the values of Cessna/Piper/Socata, 30 year old VFR tourers is the arrival of the modern generation of LSA from eastern Europe, which are nicer to fly and cheaper to run.

4 Seat IFR tourers are perhaps likely to remain a bit more robust, subjetc to the residual values and longevity of Cirrus's products.

A little contradiction in the above, as Socata haven't done any VFR-only planes, that I know of, for decades. And the values of used IFR tourers are plummetting anyway.

An interesting question would be to survey how many instrument capable owners of IFR machinery who actually use itare willing to make a permanent move to VFR-only, mainly to save money. I have so far not come across a single one. There are many pilots who could not keep their medicals and went to the NPPL or whatever, but that could happen to any of us and money is irrelevant to that one. There are also many pilots who stopped flying altogether - often because they climbed a long way up the mission capability ladder and eventually ended up with something too big, too complex, too full of hassle and downtime. A vital trick in the ownership game is to stick to a machine which is easily affordable and which is a good match for one's mission requirement.

[Pace]

10540

>An interesting question would be to survey how many instrument capable owners of IFR machinery who actually use itare willing to make a permanent move to VFR-only, mainly to save money. <

This really depends on what you use an aircraft for? If you are a guy/gal who purely wants to nip up for an hour on a sunny day then thats one thing.

If you like going places especially further afield then chances are that the weather is unlikely to be constant the whole route there and back. There is a chance you maybe stuck.

If you fly as a means of transport for business or pleasure then you have to build in a certain degree of reliability. The old saying " time to spare go by air".
You have to reduce the likelyhood of that phrase.

You need to look at IFR capability in both aircraft and pilot. Make flight more reliable still and you have to look at deice/anti ice and multiple systems.

When the Diesel engines came out they seemed to offer the way ahead for cheap flying with amazing range for both singles and twins but suffered with reliability issues.

I felt then that the way forward had to be in low cost, low power, throw away turbines I see the equivalent to 300 hp petrol engine turbine is being developed for the Mooney. Why not 100 hp or 200 hp equivalents in turboprops?

But it is not only the cost of aircraft but all the other costs which go with it that are crippling. At the end of the day an aircraft is a mode of transport like any other. It has to compete on reliability of achieving the journey and the costs have to make sense in comparison to other modes of transport for the same journey.

Otherwise they become extravagant toys which have little practical use and which pilots will get their fix from for as long as they can afford to which will become less and less as costs esculate.

Pace

[Rod1]

“An interesting question would be to survey how many instrument capable owners of IFR machinery who actually use it are willing to make a permanent move to VFR-only, mainly to save money. I have so far not come across a single one.”

The problem with the above statement is the “mainly to save money”. There are 4 IMC (one ex IR) rated pilots at my strip (including me) who have moved to fast modern homebuilt aircraft with Rotax power from fully equipped spam cans (AA5B in my case). We all do long distance touring, including Europe. We all wanted to get more “bang for the buck” which is not quite the same as saving money. Our new aircraft are;

1 New! The aircraft they replaced were all 1970’s so 35 years old.

2 Faster! In every case we now travel significantly faster. My Old AA5, at 75% (lots of fuel even leaned off) would do 125kn, new machine 138kn at 15lph. The others are similar differences. Speed is the biggest restriction in my there and back fun trips.

3 More mission capable. All the new machines have much better STOL, so can operate from a much larger number of strips at MAUW. The aircraft can also operate on Mogas, so not restricted to airfields with expensive Avgas. A man with a can is available at almost any micro strip, anyware.

4 Less formal regulation (at lower cost) We all maintain our own aircraft, which is fun and adds to flight safety (3 of us built our own). We operate from a strip with zero formality and hanger our aircraft at less than 1/3rd of the cost of the local licensed airfield (which has no approach aids)

5 Equipment. We now have a mixture of state of the art glass and various toys which would have cost us £20,000 to £30,000 to retrofit into our old aircraft.

We have all given up;

1 Night flight, but none of us used it much anyway.

2 IFR. 15 years ago I would have balked at this. However, if you tour Europe in an IFR capable aircraft, but with only an IMC, then you are restricted to VFR. Two things fall out of this. Firstly, you manage to tour VFR with few problems and realize you can apply this in the UK. The VFR rules are very flexible and an IMC rated pilot in a well equipped hombuilt can operate in poor VFR conditions quite safely. Secondly, in Europe, if you replace the IFR tourer with a well equipped hombuilt it makes no difference unless you have an IR, which almost nobody has.

3 Money. In all cases our new aircraft cost us more than our old aircraft were worth. OK we are saving £10,000 a year plus, but we had to make the investment.

4 We have gone from 4 seats to 2. I keep a record of passengers carried and this has never been an issue. I originally intended to hire a local DR400 if I needed 4 seats, but I have never needed to do this.

I would however point out that we are all fun flyers, who almost never use our aircraft for work purposes. All the aircraft fall into the VLA category, so not Micros.

Rod1

[Pace]

Rod1

What do you fly? I take your point if you hold a UK IMC rating and tour abroad, but yours is fun flying rather than have to be there flying.

Do not see why the CAA cannot allow VLAs and homebuilts to fly in IMC as they let gliders do that ;) ? Double standards.

Pace

[Rod1]

I fly an MCR01 Club;

G-KARK (http://www.laaeastmidlands.org/GKARK.html)

IFR in hombuilts is quite likely under new rules being negotiated with EASA. The new LAA CEO was very upbeat in a recent article in the Light Aircraft mag. However the devil will be in the detail and it will be some time before we know what strings are attached. :ugh:

Rod1

[IO540]

This really depends on what you use an aircraft for? If you are a guy/gal who purely wants to nip up for an hour on a sunny day then thats one thing.

In that case, an IFR plane makes little sense to start with.

I just knew you would be in here, Rod1 :)

Your examples, IMC Rated, need an IFR machine if they fly instrument approaches in real "overt" IMC, otherwise they don't because IMC under VFR while enroute is totally unenforceable, and "VFR" departures into low cloud are generally allowed here, and a well equipped VFR-only machine with a decent big GPS and the usual instruments, with an instrument capable pilot, is fine for that.

It's different for going abroad. The moment you are going to enter cloud, you need an IFR clearance. Of course you can still hack this under "VFR" but if you add the old business of rising terrain / lowering cloudbase etc etc then one can get into a pickle, and airports do not allow UK-style VFR departures into sub VFR conditions, and this is why people go to the huge length of getting an IR. There is still no cheap solution to this capability.

It's fantastic to be able to do a VFR flight on a nice day, and then when it is OVC007 do a IFR departure, a flight in perfect sunshine above the cloud, under a constant radar service (not that there is any other traffic, ever, at GA levels) and an instrument approach. No CAS transits, no real suprises. Just you and the weather have to be played against aircraft performance. Priceless.

I don't think plastic planes are yet ready for IMC prime time. A friend has had some spectacular electrical problems in a well known "IFR certified" plastic plane, flying it in perfectly normal IMC.

[Danny boy]

hi I own a multi engined aeroplane,I am still doing about the same amount of flying,this bank crisis will be over soon..fuel will probably trend down as well,dont forget you can recover the duty on the fuel when you go foreign..

[Gertrude the Wombat]

A big problem has been with "buy to let" where loads of people bought on borrowed money thinking that letting and the forever increasing house prices would allow them to build a portfolio of houses on borrowed money.
Er .... and? The problem with that is?

Provided you had a "what if the Tories get back in and interest rates go back up to their favourite 15%" column in your spreadsheet, you didn't borrow more than 50% LTV across your portfolio, and are sitting on positive equity (with anything less than a 50% house prices crash) and a rental income that more than pays the mortgage. Rents haven't gone down. (Albeit you have a smaller portfolio than if you'd been completely mad and borrowed 120%.)

OK, so the particular reason for that column in my spreadsheet hasn't come to pass (... yet) ... but overall it worked, don't knock it.

[Pace]

Gertrude the Wombat

>As the UK’s biggest buy-to-let lender, Bradford & Bingley has had a torrid year
with repossessions and arrears at the bank soaring.

Bradford & Bingley could be the next bank to be pushed into a rescue takeover deal as the financial crisis shows no sign of abating.
The City watchdog the Financial Services Authority has begun searching for a buyer for the struggling buy-to-let lender.<

You seem better placed to know i was purely relaying what I had read in a number of newspapers

Pace

[Gertrude the Wombat]

I was replying from the point of view of the BTL punter - if you're sensible about it then, like anything else, it's a sensible business to be in.

From the point of view of the bank, of course, the same applies - if they never lent more than 50% they wouldn't be in the ****, would they.

[PompeyPaul]

> Bradford & Bingley could be the next bank to be pushed into a rescue takeover

Bankers, all of this crisis and turmoil, couldn't happen to a nicer set of people :ok:

[bigfoot01]

B&B were privatised on Monday... (well the mortgage business were and savings given to those nice Spanish people...)

[IO540]

B&B was history (dismembered) even before the above posts were written!

I still cannot believe they had 80% of their mortgage portfolio in BTL and self-cert mortgages. I am all in favour of capitalism but running this allocation right up to so recently is pure blind greed and stupidity.

Back to flying, I suspect flying is going to be like it has always been: a lot of people can always afford it, a lot of people could never afford it (but still went and got a PPL), and everything in between. And some 90% have always chucked it in within a year or two.

[Pace]

>And some 90% have always chucked it in within a year or two.<

That would make an interesting topic as probably most of us have at one time or another been close to that.

When I started flying all I wanted to do was to say I had flown an aircraft from takeoff to touchdown on my own ie first solo. I would then drop it all.

But then I went on and got the PPL. After that and the usual highs of impressing your friends with 1/2 hr jaunts there than came a point of what do I do now? add ratings.

I am sure had I not gone on into the commercial aspect and getting others to pay for it then who knows. but most of us must have at some time questioned whether to carry on.

Pace

[scooter boy]

Fuji, as my neighbour down in Maders, Cornwall observed to me the other day "we wouldn't know anything about a credit crunch if it wasn't on the news all the bloody time".
There is a certain truth to this rustic logic.
IMHO the media are guilty of propagating insecurity for the sake of "news".

I am aware that other sectors of the economy are feeling pain but remain entirely confident that the economy, house prices etc... will recover given time.

As previously a new government on both sides of the Atlantic is sure to follow and bring with it more optimism and security in the markets.

In the meantime I remain the busiest that I have been in several years - it makes little sense to me but I'm not complaining
Go figure...

SB

[Pace]

>we wouldn't know anything about a credit crunch if it wasn't on the news all the bloody time".<

Scooter I was married to a Cornish Girl and thought you had carrot crunchers not credit crunchers down that part of the world :) xcuse my joke.

Used to fly a company into Davidstow about ten years ago in a Cessna 303 crusader. they were on a contract with the food factory there.

I had to select patches of the runway which were landable on checking for sheep and other wildlife which frequented the broken up runways. There was a microlight group there and a small clubhouse.

Your other airfields were Bodmin which I never landed at, Perranporth which was and is a great location, St Mawgan where I have flown into in biz jets and Truro a grass strip which I visited even longer ago in a 182

Beautiful part of the world

Pace

[gyrotyro]

"I fly an MCR01 Club;"

Would that be the same mcr that has a tendency for the tail to go AWOL ?

[Rod1]

No, different version, and it has only happened once to an aircraft which had been crashed and repaired.

Rod1

[scooter boy]

Pace, youa re quite right in that we have "carrot crunchers not credit crunchers down that part of the world" that must be why I have been immune to the recent goings on - the price of root vegetables has remained stable!:ok: lovely part of the world (in the summer).

I was planning to head back to Plymouth this evening but may drive back instead - the wind looks like it would be a bumpy old ride.
SB

[youngskywalker]

Scooterboy- I thought that a surgeon would always be busy? Or is it mainly cosmetic surgery you do and therefore an expensive treatment that people dont' need to do?

[Fuji Abound]

A number of "my" consultants in Harley Street have never been so busy. Business is literally booming.

However, consider the point, however you approach it, the cost of what is (and has) taken place in the financial markets has to be paid for however you cook the books. The Government is meeting the cost out of borrowed money because when they looked the chest was empty.

Of course the pot is stirred by the press. The same press that are as opposed to increased regulatory control as they were when their freedom was questioned during the McCartney trial. The press doesn’t want regulation any more than the City or us pilots. They claim both the press and the City is still capable of regulating itself despite what has happened.

Those of us who have paid for our aircraft and do not have any or any significant borrowing will not feel an immediate consequence. However tax will rise, the cost of living will increase and the economy will slow in many key segments. Of course we hope it will be short lived but some people will suffer, and suffer greatly. Since GA is largely a leisure pursuit experience suggests these are the areas that suffer most during times of economic slow down. That can bring advantages. Some engineers will be open to more competitively pricing for work and larger airports that priced GA out during the busy times might want to encourage them back. I recently had an aircraft cleaned. I was confronted by two engineers who had become cleaners for the day and indeed spent the whole day on the aircraft. When I asked why, they said they had nothing else to do. The year before they were snowed under with work. I hope it doesn’t bring too may disadvantages. The knee jerk reaction can equally be to increase prices to make up for the work lost. Simple - if the number of landings fees has halved, double the charge and you, the operator are back where you started. Of course if this happens we are on the road to the end of GA - at least at the larger GA airports.

[scooter boy]

I thought that a surgeon would always be busy? Or is it mainly cosmetic surgery you do and therefore an expensive treatment that people dont' need to do?

Hi Youngskywalker, I perform both reconstructive and aesthetic surgery. The insured market has fallen off in the last year or two because the NHS has become far better at getting on with things - shorter waiting lists etc... which is a good thing. Most of my income comes from private work which is self funded (non-insured) and I am as yet unaffected (in fact at present 30-40% busier than last year and getting busier by the week). Historically even the non-essential aesthetic type surgery has not been affected by economic slowdown, although we may be witnessing a downturn bigger than anything in recent history and I may well eat my words (and have to sell my hard earned toys!)

Anyway, I'll keep crunching the carrots (keeps my eyes sharp!) and sharpening my scalpel - :ok:

SB

[skua]

Danny Boy said
"hi I own a multi engined aeroplane,I am still doing about the same amount of flying,this bank crisis will be over soon..fuel will probably trend down as well,dont forget you can recover the duty on the fuel when you go foreign.."


I am not sure I am on the same planet as you. The effects of what we are seeing now will be around for a long time. Many Western governments will find their budgets blown apart, not just from the cost of bail-outs but because of lower tax revenues. The inevitable consequence will be higher rates of taxation, and more stealth taxes - such as OFCOM's ridiculous frequency taxes.

as for duty drawback - have you not heard the rumours about that being ditched shortly? Why would a bankrupt third world government want to give back money to its citzens when it can hang on to it and spend it desperate attempts to win the next election (eg nursery education for two year olds).

Have no fear, we pilots will suffer.......

Skua

[Fuji Abound]

as for duty drawback - have you not heard the rumours about that being ditched shortly?

There is apparently no truth in these rumours - or so say MHR&C.

I am pleased to have some good news for a change. :D

[IO540]

The bulk of the X Billion spent on rescuing some bank(s) will come straight back to the Govt, in the form of direct and indirect taxation, and the rest will find its way back into the economy as soon as the dealer(s) start to spend their bonuses :)

The economy contains a huge amount of traditional manufacturing companies - contrary to all the hype about "most" stuff being made in China - and these carry on more or less as normal. The "economic meltdown" media hype is hugely overdone, but one cannot prevent a lot of people panicking and battening down the hatches (cutting discretionary spending) just in case the worst happens. And this is bound to affect GA activity to some degree.

[Squeegee Longtail]

I am still looking for a 4(+1) seat IFR single capable of Cannes - England/Holland regularly. Although there are a few around, nothing has dramatically dropped to "bargain" levels yet in the UK. I am looking for N-Reg and can see some "good deals" appearing on the US GA market though. Still nothing that indicates panic selling.

I can't hear anyone feeling sympathy for the bankers in this, but don't forget the pension holders or private investors (GA aircraft owners?). They ultimately will directly suffer much more than the guys & gals who took massive bonuses from selling the toxic investments into the market.

There is still a lot of downside left in this situation.

[Golf Echo 30]

Hmm, I think that IO540 might be underplaying the "economic crisis" just a tad.

Squeegee Longtail is almost certain to find a bargain in the UK sooner rather than later and if the US politicians don't vote in favour of the bill tonight and Libor spreads don't start to narrow, then a gallon of avgas may well get you a free 4 seater......:(

[Fuji Abound]

IO - on this occasion I cannot agree with you.

Roy Ayliffe today said today manufacturing was suffering the worst operating conditions since the survey started 17 years ago.

The FT said today:
Many economists now think the outlook is so bad that companies that have refrained from cutting staff as they wait to see how the economy fares will soon start making large redundancies – pushing the economy into a deeper recession than appeared likely only a few weeks ago.

I am far convinced this is hype.

Unfortunately Britain has coupled these problems with unprecedented levels of personal debt which many were already finding difficult to service. The spectre of negative equity is once again a real threat for many.

The politicians are well aware of the consequences and doing everything possible to soften the landing. At the moment the rapidity of the slow down and the actions of the politicians is masking its seriousness. However, equally the consequence of their actions and the lag inherent in the system risks a chain reaction.

Forgive me for my pessimism. Hopefully the slow down is manageable and hopefully it will not be too painful.

I am not surprised it has not translated into aircraft prices - yet. Psychologically we all hope to realise the same value that assets were worth six months ago. Consider for a moment how many houses are unrealistically priced. Even the agents will talk you into advertising your property at x+ the true market value - and of course it wont sell unless discounted. In short it takes time for the headline prices to fall.

Mooney has now laid off a significant proportion of its work force - a company that was booming a year ago. In the States GA movements are down by more than a third. You will get at least 20% off the headline price of almost any aircraft for sale if you are a serious buyer.

[BeechNut]

Well, in Canada you practically need a subprime mortgage to fill the tanks. At 225 liters capacity, and $1.80 per liter, filling the tanks on the Sundowner can pinch a bit! But to you guys in Europe that probably seems cheap.

My biggest fear is the loss in value of my asset, my plane. My house is paid for, my wife has a recession-proof job (physician), I also work in the health care sector (in IT). So if the plane plummets in value, I can think of no other solution but to keep flying it :)

I would like to trade down to a two-seater though, to cut costs now that the kids are growing and slowly leaving the nest. Have my eyes on a nice one, but have to sell the Sundowner first, and that will be tricky in today's market especially when you can cross the border, with our currency nearly at par, and pick up a bargain. It will still cost you about $5k to certify it in Canada, but you will likely come out ahead anyway.

So, I sit tight and fly, trying to save on gas: shorter flights, lower cruise speeds like I do in my car, etc.

[IFMU]

My flying is a lot like the rest of my life. I have what I can afford, with comfortable margin. I own a 30 year old glider. I tow for my glider club which costs me nothing but is a lot of fun. I belong in a club with a C140. The 140 is cheap to run, no more than 5gph of car gas. I belong to another club with a PA28R, with very reasonable rates. The Arrow is by far the most extravagant thing I fly, I'm getting my instrument rating in it. I'm scratch building an experimental single seater, a hummelbird. Credit costs have no sway over my flying. Gas costs have had little impact in my flying. Some of the airplanes I would like to fly and own would cost a lot more money, and if they weren't over my means they would at least be pushing them. So, I fly what I can afford and am happy with it.

-- IFMU

[IO540]

I am still looking for a 4(+1) seat IFR single capable of CannesAssuming the 4+1 people are "British average" weight, a genuine 5 seater with a ~ 600nm+reserves is never going to be cheap - even if somebody gave it to you for nothing in the first place.

Do note that advertised prices have been about 20-30% above what is actually paid, for a few years now. But no broker is going to print realistic prices because the moment he does, the whole market gets marked down to the new published price. And individuals do the same. I see specific planes which I know a fair bit about, on the market for a year or more. They won't sell at the advertised prices. It's a bit like a falling housing market - sellers are in denial for a long time, but eventually some have to move.

Mooney has now laid off a significant proportion of its work force - a company that was booming a year agoTheir problem is that while they make high performance aircraft, their customer base was getting squeezed year on year. They never innovated, only eventually screwing a G1000 into their panels. You can keep selling an air cooled Porsche 911 for only so long. Their latest model achieves the amazing quoted TAS at an eye watering fuel flow rate, but that TAS will not be achieved except at an altitude at which oxygen is verging on impractical. Very capable but one has to be realistic about how many pilots fly those mission profiles. With Cirrus etc chipping away around the edges with car-like interiors, eventually, something had to give.

Well, in Canada you practically need a subprime mortgage to fill the tanks. At 225 liters capacity, and $1.80 per literBetter not come to England then :) It's twice that here; more in some places.

I do not doubt that there is going to be a violent emotional reaction to the present doom and gloom, which is of course a self fulfilling circular argument. But how many people are going to stop eating corn flakes, etc? High fuel prices will affect a section of GA but these came long before the banking crisis. And "cheap" airline ticket prices are creeping upwards fast right now.

[Fuji Abound]

Their problem is that while they make high performance aircraft, their customer base was getting squeezed year on year.

That is very true but a year ago they were still selling lots. Pilots havent just decided in the last year that the opposition has crepted up and overtaken them - their sales have collapsed because of the slow down in the economy.

Of course buinesses like Mooney will feel the impact first - it is only the most robust that are able to survive difficult times. I think Mooney are far from the worst effected.

I have said it before but the other regrettable aspect to this is when most pilots hang up their headsets they dont come back and dust them off - they are gone forever. So when fuel prices go up, even if the price fallls some while after, those pilots who find it was getting too expensive are gone for good.

[Squeegee Longtail]

"Assuming the 4+1 people are "British average" weight"
No, they aren't, otherwise I would have said "5 seater". I mean 4 (+1) (as in your TB20 can have a fifth seat, but isn't really a 5 seater).
I am 3 adults, 2 small kids (1 & 3 yrs).

If someone is "going to give me one for free" I will take it and say "thank you". My running costs will be paid for by my (generous) employer, so I just need to buy the rocket. In the 8 months since I started looking, at lot has happened in the financial world. I just can't see that it has affected prices too much just yet, hence writing this in this thread.

[Fuji Abound]

If the running costs are not an issue the why dont you "invest" in a twin?

MEP prices are at rock bottom. You can get a decent twin at half the price you could a few years ago. Moreover if you bought an Aztec for example weight will cease to be an issue.

An MEP rating is pretty stright forward if you have already got a few hour sunder your belt (assuming you havent got the rating already).

I thought very seriously about going this route myself and looked at a couple of really well sorted Aztecs at rock bottom prices. Moreover properly maintained and used by one careful owner (in contrast to being bashed around but IR students) there is every reason to hope for reasonably low maintenance costs. In my case I dont fly with more than two people enough nor do I have the time to travel over any significant distance regularly.

Just a thought.

Perhaps we could steer you in the direction of an odd bargain or two if we had a better idea of what you want from an aircraft. Do you want all weather capability, what about speed and / or range and how regularly will you be carrying a load over distance?

[Squeegee Longtail]

...Well yes there are also twins, but also turboprop singles, & twins, and why stop there? there are old Citations etc at knockdown prices and then there's VLJs.

I do get your point though. I have traditionally thought of light twins as t*ts on a bull - no great increase in speed, disproportionately high maintenance costs, safety from second engine cancelled out by assymetric accidents etc.

I have looked towards the newer technology ie. Cirrus, Columbia etc but get stuck on the 5th seat aspect. I may have to settle on only 4 seats in the end. It is a shame the DA42 doesn't have more reliable engines!

Getting back to the thread, I cannot see panic selling, or any noticable drop in prices. Prices may be 20-30% discounted in reality, but they have been that way for 3 years, as IO-540 says, so no recent change. Time is on my side! I can wait and see things develop. I am happy to be a buyer, not a seller.

[Fuji Abound]

Forget all the nonesense you have heard about twins.

It is true that some twins perform very badly on one engine. Perhaps these are best avoided.

An Aztec does not suffer from these disadvantages. A Twinstar requires an experienced hand at MTWO if the critical engine fails at the worst possible moment and in any event it is not a five seater. I have got a lot of hours on both including two engine failures.

If you are current on an Aztec it is a very pleasant aircraft top fly. It has bags of performance, will cope with almost any weather and to boot provide you and your passengers with a comfortable ride. Whatever they say there are times when that extra engine is one hell of a comfort. Accident in twins IMO happen when pilots are not flying the aircraft regularly, it is a twin with a marginal performance or things go wrong in IMC (and twins are likely to be doing a lot more IMC work than singles.) I fly a 22 a lot, and it is true they are quicker than most twins but they are also exceptional. On the whole most twins are quicker than most singles or to the extent it matters the difference over a typical journey is marginal.

Of course twins cost more to run, significantly more, hence my earlier observation, if running costs is not the issue, buy yourself a really decent Aztec. You are not going to find a single that can carry the same load (or even close), will cruise at a very comfortable speed, is properly de-iced and always a pleasure to fly when the going gets a bit rough, has very good single engine performance and yet taking into account the huge difference in capital cost over a five year period will probably cost less to run than a 22. If you are not paying the running costs but having to find the capital it wins hands down - no competition, and because of the concerns over the cost of fuel, the huge fall off in pilots with MEPs, and the general unfounded perception that twins are less safe than singles prices are on the floor to the extent that it is difficult to see they can fall much further.

[IO540]

Squeegee Longtail

A Seneca should fit your requirements. OK the design is an old dog but a T should be able to make FL250 at a push, which ensures VMC on top a good 99% of the time. in Europe.

Obviously you need an IR for any real mission capability around Europe - unless you and passengers are willing to stay put and wait for a nice day, for anything up to a week.

In singles, much depends on your weight situation. A TB20, with the 5th seat (was the GT ever built with the 5th seat?? I don't know; mine certainly hasn't got it) will carry MTOW from south UK coast to Cannes on hardly more than half a tank. I've done south of Spain in one leg, landing with 23.5USG.

But a 4+1 type is not going to be nice on these 4+hr trips. Unless you studiously dehydrate everybody :) somebody is bound to need a wee, and some people (especially children, and women) don't like doing that in public. This is where a "6 seater" with club seating comes in. Only the biggest and thirstiest can actually carry 6 with junk, but something like a Mirage (or the Matrix unpressurised version) may well do it, weight-limited as they are.

If you can make £1M or so, a Jetprop is the biz in the "cheap class".

The rest of the old (and cheap to buy) "6 seat" iron doesn't usually have any altitude capability, and IMHO European airways flying is very hard if you can't make FL160 or so, to stay VMC on top.

[PompeyPaul]

I'm amazed there are people on this forum suggesting the credit crunch is all "hype". You just need to look at the world stock markets to see it's much more than that. Whether the newspapers have hyped it to get us here or not is debatable, we are though, very much in difficult situations.

I don't believe anything I read in papers, I just believe what the red numbers I hold say. Anybody who holds money in the form of stocks & shares has just got an awful lot poorer. That means, the majority of us whether by direct share ownership, or pensions or anything else, have lost out recently

Whilst it's true that the vast majority of people are carrying on with their lives as if nothing has happened, it will start to bite more and more people. I'm fine right now, can afford to fly and carry on as before. However, I hold my wealth in shares, property and raw cash. If I need money for any reason, an expensive service or a new boiler then I'll dip into cash savings. Once that's gone though, which depending on how long the economic gloom will carry on for, could happen I'm then going to siginificantly cut my spending if any further emergencies occur. I reckon I can probably take another 6 months, to a year, of shaky stock markets before I start to feel it. I suspect there's plenty of people feeling it already (especially if they were hand to mouth in th boom times). Although, I am already feeling it as house prices drop. The idea of picking up a bargain has become very real, so I've cut spending to save more so that I can pick something up if things go very wrong. Either way, I'm spending less.

This is bound to have an effect of flying, probably not right today, or tomorrow, but if things haven't turned around in a year then I garauntee it will have a tangable effect. If nothing else Farnborough Radar should be quieter :)

[Fuji Abound]

PP

I agree, it is a very serious issue.

IO

Why would you want to buy a Seneca over an Aztec?

[englishal]

I wouldn't buy a Seneca or an Aztec. I'd either go for a fast single like the TB20 or go for a modern Jet-A twin like the DA42 (but it doesn't fit 5...sorry)but of course the DA42 is not any quicker than the TB20 but it does have several advantages that I like: A) Jet-A, b) FADEC, C) G1000, d) 2 engines. The new engines with be 170HP Turbo Diesel engines meaning it should cruise at 190kts.....that will be a cool machine.

Also I have just has the pleasure of being introduced to the G1000 synthetic vision. Amazing piece if kit- you can fly a WAAS GPS precision approach down to 200 feet by flying down the tunnel and plonking the flight path marker on the end of the synthetic runway. The TAWS turns the synthetic landscape red and indicates the point of impact if you don't do something about it, and the integrated AP can fly the vertical nav too......

Oh to have several hundred grand burning a hole in my pocket!

[IO540]

Why would you want to buy a Seneca over an Aztec?

I wouldn't buy either (would have to re-do all my bits of paper for ME, and think twins are a waste of fuel) but for me the Seneca wins on

- operating ceiling (25k for turbo version, IIRC) so would fit my "always climb to VMC on top" IFR strategy

- certificable at 1999kg (if going IFR, worth some £200-300 on a long leg)

- uses less avgas (2xIO360 v. 2xIO540) for same or higher speed

Obviously an Aztec can carry a lot more weight, but a 737 can carry even more :)

I am sure one can run a SE turboprop on the operating cost of a piston twin, these days, so that would be my step up if I was doing one.

[Fuji Abound]

Not that it matters, but comparing like with like the Turbo Aztec goes just as high (24,000 certified), is quicker and carries vastly more load.

The capital cost of both a 42 and a SET is significantly more than either an Aztec or Seneca. The poster said he wasnt bothered about the running costs but wanted a lower initial capital cost.

A TB20 cant carry the load.

As always it is about matching the aircraft with the mission and the budget - if you neither have a mission or budget all sorts of possibilities become available.

[Fuji Abound]

I'm amazed there are people on this forum suggesting the credit crunch is all "hype". You just need to look at the world stock markets to see it's much more than that. Whether the newspapers have hyped it to get us here or not is debatable, we are though, very much in difficult situations.

I wish this had not come round to bite us quite so quickly but as some of us indicated earlier unfortunately what is taking place is not press hype and will effect every one of us in the fullness of time, even if things start imrpoving tomorrow.

It will turn the aircraft market on its head - not instantly but in time.

It is indeed a bad time.

[IO540]

The time to buy FTSE100 will be when one sees 10 consecutive posts on pprune forecasting the end of the world.

Today is pretty good - down about 8%. After yesterday...

[Fuji Abound]

Is that the PPruNe technical definition of recession then? :O

[Fuji Abound]

Time moves on - and looking back I wish I could have said I was wrong.

A friend has just purchased an aircraft - I and he reckon it would have been twice the price a year ago. Mind you there are those who said the biz jet market would remain buoyant - they got that wrong as well, unless your are fortunate to be at the very very top end of the market - a client has just sold his aircraft for more than he paid five years ago.

[IO540]

TB20GTs in very good condition (basically, ~2002 versions) are still fetching prices which suprise many. About 70-75% of the new cost in 2002. This suggests that people with money who know what they are looking for are still around and they will pay for something they really want. Same, I gather, with Mooneys.

It is the common stuff which has seen a bit of a collapse in values. This stuff tends to be bought by people who are financially stretched so this is to be expected, IMHO. Something a bit knackered which might have fetched 50k a year ago might fetch 30k today.