Twin operations up north

[marpoo]

hi all,
i have often read threads regarding someone buying a single and boring a hole in the sky to build hours. what i haven't read about is someone buying a twin and then getting subcontracted work from an operator up north. do any of the operators up north sub contract to owners of twins. has anybody bought a twin before to build hours like the mentioned way. any info regarding this would be great. i.e insurance needs, possible operators to contact, type of twin, running cost etc. i am not sure if this is viable or not and was hoping for input whether good or bad.

matt

[Mainframe]

Marpoo, yes, it has happened before, but usually you are compounding your chances of being exploited and ripped off.

As a low time pilot you are vulnerable (usually willingly so) to some of the shark operators "out there".

You will be lucky to get paid for your flying and more so for the aircraft hours.

Often you will get mixed up with an operator who has their own maintenance shop and quite surprisingly your maintenance bills will exceed what you are owed for the hours flown by the aircraft for that operator.

It has happened and maybe one or two of the victims will confirm this has happened.

So if Dad buys you a twin to get work, think about where and how you will maintain the aircraft, bearing in mind that the logistics of operating and maintaining an aircraft in a remote area will probably add $100/hr to your base operating cost.

You need to think about the fact that an aircraft (or any machinery) turns to S*#t ten times quicker up north in a remote salt laden atmosphere with mostly lots of dirt strip operations.

Ferrying to Darwin, Mount Isa etc for maintenance is expensive, so is the freight and downtime on parts, and you're probably staying in a motel during the unplanned outage and you're not earning money.

Probably ok for a capital city, bitumen runway venture, but otherwise, "up north", a great way to lose Dad a lot of money and give him a great tax break that he probably didn't plan on.

And what about the insurance company and their prohibitive premiums when someone outside their risk factors is going to fly their insured?

Please have a really good think about this, a great way to build twin hours, a great way to go broke quickly.

[ITCZ]

Be careful of any thoughts that amount to 'buying' yourself into a job or experience.

If you are just trying to break the 500 multi IFR barrier, then you might create more problems than you solve.

I know of a couple of blokes who bought into flying schools as Grade 3's who ended up in court suing their CFI/business partner. How could they have ever been 'equal' partners?

I know of a bloke who bought a Baron 55 in '94 to do what you are thinking, and he won't say so but I don't think he feels that he got any further especially with the number of dramas it caused him.

I know of at least one other bloke whose 'acorn to a big oak tree' charter business ended up in family lawsuits when all the family money 'disappeared'. The guy had 500 multi alright - 500 hours in multiple solicitors offices.

You are basically setting up your own business in an area in which you have by definition very little experience. What qualifies you to do a better job than someone who has been in light twins for decades?

Which twin? Baron, 55 or 58? C310? C402, B or C model? Aztruck? Navajo? Chieftain? Partenavia? Some are suited to different work -- short sectors of 15 to 20 minutes between islands, or running out to WA mining camps?

Clientele -- aboriginal folk or mining executives? IFR with greater capability, or VFR for lower maintenance and no enroute charges? Who will hold the maintenance approval?

Old or new(ish) airplane? Why is it for sale -- someone else trying to get rid of their millstone/money pit/bad idea? Whats on the market?

Will you form an association with a particular business or go it alone? If they think it is such a good business idea to have another twin in their fleet, then why are they not buying one themselves?

Who will supervise you as a chief pilot? Which AoC will you operate under (remember the rules got tougher on that a few years ago too)?

How will you feel if someone else runs a prop through a star picket on your day off and puts it out of action for a while?

Have you owned and operated an aeroplane before, and do you have a true understanding of how much it will really cost?

What if you solved all these problems and put it on line with an established charter outfit, who for whatever reason find it easier to indirectly use your financial resources instead of acquiring aircraft in their own right.

What if they are the people taking the phone calls and invoicing the customers and paying you, but instead of you getting your pitiful charter pilot wages every fortnight, you maybe get paid 90 or 120 days in arrears, but only after you have an argument with your 'business partner' who is busy trying to keep his own aircraft working and paying refuellers, etc, and naturally puts you, the boggie bush pilot, last.

And remember, if things go bad, YOU have to go hassle the engineers to fix your Baron instead of the other guys collection of twins and singles, while your employed 'colleagues' are merely bitching about the lack of flying while they drink coffee in the office.

And if the operator goes bust, owing tons of money left-right-and-centre, they, as employees, will get paid before you do and get better and faster treatment under the law, maybe with free legals from their union or state government dept of industry, maybe suing for underpayment of wages, while you have to chase your 10c in the dollar with a $250/hr lawyer that you pay for, no refunds, and most definitely at the end of the queue as an unsecured creditor.

What if in a year or so you have enough twin time to take the next step up the ladder but this beaut twin has two years to run on the finance and you can't find a buyer?

What if you get the multi time you want and VB (for example) offer you a job but you can't afford the 737 endorsement coz you are mortgaged to the max to the finance company, you still have that bill for a replacement TSIO-520 but the engine shop has put a workers lien on it because you haven't paid your last bill and the guy whose line you put it on has gone into receivership owing you the last three months of charter receipts?

And how much airline interview study did you get done while all this was happening? :)

Stop it ITCZ, stop it stop it [stamps feet] :mad: HOW NEGATIVE OF ME ;)

We have all seen it before, it stops being a surprise

If you are motivated and have the resources, by all means, have a go mate, but remember that there is probably a reason why most blokes don't go that way to get multi time.

[marpoo]

ITCZ andd MAINFRAME,
two fantastic replies. somewhat negative mainframe (not my dad's money mate ), but still very informative. many, many things that i did not think of have now been brought into focus. i am trying to explore every avenue. not to get there quicker, as i understand that you have to 'pay your dues', but just to get there. once again guys thanks for the informative replies.

matt

[nasa]

ITCZ and MAINFRAME....How true you speak.....However.....Like any other walk of life, do the numbers properly and check the background of where you head, and things can work out for you.

I was speaking with an acquaintenace the other day, and I was reminded of when he was but a young pup, (arrogant, cheeky, ugly, spoilt, brash, couldn't fly a bad story) (that should just about do the description and if nothing else, get me a phone call :D :D) and he purchased a Parts of Avia and headed north.....He now owns the company he started with on the same conditions of which you speak, and has some 12 or so aircraft to his name, including one he cross hires from me.....Now I didn't say he was making a fortune, but he is doing what he likes and gets to pretend he's flying :eek: (at least that's what he calls it).

Come to think of it, we both agreed that we would be better off if we owned a pub with a brothel on top and a pool in the back yard, but wouldn't have as much fun.

Like anything else in life, there are those out there ready to rip you off if you drop your guard, the difference here on PPrune is that you get the warning up front. :cool: :cool:

Good luck.....

[ITCZ]

Marpoo, perhaps the best advice that can be given is that what you are proposing is starting a BUSINESS career in the flying industry, rather than starting a PILOT career.

If that is what rings your bell, then nobody should stop you.

However, as someone who grew up as part of a family business and started a couple of businesses of my own (all with varying degrees of success :)) the thing that strikes me about charter aviation as a business is that it is probably the most highly goverment regulated small business there is -- AoC requirements, CofR, CofM and everything.

The equipment is expensive and complicated, requires intensive maintenance, there is high exposure to risk and damage, the employees require specific training and high supervision requirements (yet they are all looking to move out of your business within months or one or two years), etc. Most importantly, the margins are thin, and you are a service industry to other fickle industries such as agriculture, mining, tourism, and government services in which a bad season or a change in policy sees you badly affected.

My 2c worth.

Good luck!

[Mainframe]

Marpoo Sorry if my response sounded negative, probably cynical after seeing similar things before and being approached by pilots with their Dads asking "If I bought a twin for my son would you opearte it and let him do most of the flying in it".

Also personal knowledge of Dads buying twins to kickstart son's career.

Didn't realise you were considering self funding, but the cheaper twins have proved to be financially unviable in charter.

If you study the resale/for sale price of GA twins you will find that the most financially successful and practical charter aircraft are also the most expensive, market forces at work.

So a good twin is going to hit you around $250,000 or more, and is going to cost you around $400/hr to operate before profit, loan repayments, $50 landing fees at most aboriginal community airstrips, and you probably want to earn something for yourself as well, so you need to budget on achieving a minimum of 700 hrs/year.

In two years you're most likely up for two engine overhauls @ $50,000 each, and two prop overhauls @ $8,000 each. (this is included in the $400/ hr cost above, but you probably won't have zero time engines or props on what your budget says you can buy.

You will need to budget $20,000 every 6 years for repaint and reupholster, and expect your 1st 100 hrly to cost around $12,000 if you take it to a maintenance shop that hasn't already been working on it before.

You're better off flying someone else's and spending your money sensibly on wine women and song instead of frittering it away on frivolous things such as aeroplanes, even a divorce is cheaper than owning and operating a twin.

Seriously though, if you win lotto, give it a go, it'll keep you in your comfort zone instead of you spending all that money on something that might give a reasonable return on investment.

So please, at the risk of again being thought negative, I'm really being positive and trying to stop you becoming an undischarged bankruptee.

[AZTRUCKER]

HI marpoo, I had bought my own single to get my PPL 2 years ago, When i got my PPL i bought my self a twin
and got my CPL and MECIR. I saved myself an absoulte SH!T load of money by doing it this way. In fact i have almost got my flying training for free because i would hire out both aeroplanes while i was doing my training. Buying a plane is exactly the same as buying a car... You can end up with a dud so for god sakes get it checked out by LAME that you can trust!! ..... this is very important. Always take the plane for a test flight longer than an hour and test all the nav aids and Radios e.t.c .

Owning an aeroplane isnt always gloom and doom if you did your home work prior to purchasing it. Its also not red roses all the time either, like anything you take the good with the bad and just enjoy.

The things to check out for are the costs on where your going to park it and insurance.

Dont buy a plane if you cant afford to run it without it earning you an income. It is an excellent way of building hours and doing the odd charter if you have it online with a charter company. Most charter companys will use your plane as a last resort because they are obviously going to want to use their own first.

I have copped the odd smart @ss comment about being an aeroplane owner, However nine times out of ten you would find that these people have never owned aeroplanes themselves and that they are probably just jealous.

You learn a hell of alot when owning your own aeroplane aswell as having such an apreciation for them . If i was ever an employer of an aviation company i would look at hiring people who have owned there own planes for this reason.


Oh and by the way Daddy didnt buy my planes for me either!