Shares in aircraft? good idea?
 

Hi, anybody have information on the cost of owning shares in different types of aircraft? i know there are groups out there of maybe 10-12 people who have 1/12 each for example, was just wondering how much shares would be in the following types:-

Single piston
Multi piston
Multi turboprop?

thanks people!

Danny, doing a search will find you loads of threads about this.

Regardles of type, the CAA limit is everyone must own at least 5%, so you could never have more than 20 in a group. Plus you'd probably never have any availability! :ok:

However, I have 1/10th share in a C-172, it's £60 / month & £65 an hour wet. It's on the expensive side, but it's in great condition and meticulously maintained.

DW

lol
 

Thanks for the reply!

60 a month is good, although 65 per hour wet is a lot more than i imagined !, any reason why?

thanks again :)

Look in the aircraft mags, find the price of these machines then divide by the number of shares (up to 20 as said), this will give the purchase price of the share. Running costs again depend on type and where kept.
We have a 5 member group around a PFA type kept at Goodwood, this works out at £85/month + fuel and landing fees (20l fuel/hour). We are looking to add a second CAA type (probably 4 seater), with 10 more in the group monthly costs will be about the same and hourly rates about £40-£50 so if you do a couple of hours a month you are saving loads over club hire rates and with better availability- or, even better, you can afford to fly lots more.:ok:

I think that, given the choice of aircraft types listed covers a range of operating cost of approximately 100:1, Danny might wish to first narrow down his mission profile.

The max-20 limit applies only to a G-reg (under UK CAA rules) and only if maintained under Private CofA rules. Under Transport CofA maintenance rules there is no such limit. In reality, a group of 20 or more will offer very poor access, albeit at obviously a relatively low cost. A further downside of such large groups, from what I've seen, is that it is so difficult to keep track of who has been hammering it down on the runway, and generally keep track of pilot competence and currency, etc, that the planes involved tend to be old and in poor condition, which in turn raises the maintenance costs out of all proportion to the expected inverse of the group size.

Every other sharing gotcha must have been covered by now elsewhere :O

I own a 1/12 share in a C-150

Share cost £1350, £40 a month and £40/hr wet.

HB

I've just bought my fourth share (serially, not in parallel).

My experience is that you get a better aeroplane, with more flexibility (for example to take it away for the weekend without paying a premium, or have a week's flying holiday), for around half the hourly rate if you fly at-least 25 hours per year.

BUT, be aware that as a joint owner you are jointly liable for sorting out any problems, and you must be prepared to roll your sleeves up occasionally and pull your weight - whether that's in sorting paperwork, finances, cleaning, maintenance. That's basically what's paying for your cheap flying.

Nonethless, flying in a good syndicate beats hiring any day in my opinion.

G

I would also make sure that you fully understand what form the group takes........ie, is it a Limited company etc....make sure that the aircraft is actually owned by the group members and that there isn't a silent owner in the form of a holding company etc.

I'd avoid at all costs any group that is part of a Flying Club or similar.....serious potential to get your fingers burnt there.

The thing is that you can't have it both ways i.e. get the benefit of

total operating cost divided by # of members

and at the same time

being able to walk away from unexpected bills

I am familiar with a "group" operating a very classy aeroplane, the like of which is just about impossible to self fly hire, where the hourly rate is extremely competitive, yet the renters (they aren't owners at all) aren't liable for anything. The owner does it just to recoup some of the fixed costs. Obviously he's very fussy about who flies it - a current IR or a working ATP is the minimum, and no way to get airborne solo without a number of check flights and a full understanding of ALL the kit.

Which really is how it should always be.

Shares are a very sensible way trying to reduce your costs, but there can be some expensive pitfalls if you choose the wrong group.

I have seen a few people who have been offered a share in an a/c , suddenly find that they are liable for a massive bill, basically they were offered the share to try and reduce the costs for other members who all knew about the big bill on the horizon. Not very fair really!

Be careful about the ownership split, if onr person has a significantly bigger share, then sometimes you can be treated as if you were just renting it, rather than as a co-owner.

However, if you do find a good group and a good a/c, then a share is a brilliant idea. You have some control over the a/c and how it's looked after, something you don't get when renting, though you will need to put a bit more work in than just turning up and booking out.

£65/hr for a 172 isn't too bad, ours for instance 172 XP uses at least 40-45 litres an hour so at nearly £1.25 a litre that's £56 straight away! then add in engine fund, maintenance etc. and with a machine like that on a Public Transport CofA then you won't get it for much less.

humm
 

Well in that case, what about starting up ones own group, that way i would get to choose who i fly with, the amount of people that i share also. I would imagine that this would have its benefits?

Buy a cheapER aircraft, initial share price goes down, decide where it is based for cheaper hangarage?

Or maybe mopve to the US, and buy a share over their with the cheap gas?

thanks people!

True, and also your monthly donation is also smaller, but your availability goes down.
We have 5 shares in our group and we are looking to increase to 6 or even 7 as the aircraft is under utilised, I think with many more than that for a single aircraft you could start to find availability starts to get more awkward.

lol
 

Hi, any info on the aircraft, type, share cost, wet cost, monthly etc.?

thanks

Is there any way to protect youself from this? I'm thinking of buying a share, but don't want to buy in and a week later the engine to go bang and get a £15,000 bill which I have to fork out 25% of.....

The other option I'm considering is to buy an aircraft myself, with full engineers report of course, base it where I want to base it then try and sell 3-4 shares. The downside of this is that if I don't sell the shares, I have £30-£40k invested in an aircraft plus all of the fixed costs.....

Anyone for Compton abbas or thereabouts? (just thought I'd ask ):D

I don't think there is any way to protect oneself from a huge bill if the only person who knows about the problem is keeping quiet (assuming the maintenance engineer who told him about it is also keeping quiet).

I am sure this has been done to death already in the many "group" threads but it would seem to me essential to meet all the present owners, and look at the maintenance records, and also meet the maintenance firm and ask them to confirm (in writing if possible) that they are not aware of any problems other than those listed.

The problem, as I have found out in another context, is that maintenance records are usually spread far and wide. It is common to get work done (especially expensive avionics work) by a firm far away from base and perhaps never use that firm again. The records of the work done should of course be kept but if they aren't then nobody will know about it, as there is no systematic way to locate the stuff. The only way to find out is by stripping the plane down and comparing the number on any part that carries a serial number with the s/n given on the original build documents (if you can find those) and even that isn't foolproof because e.g. a dodgy ADF (£3000 a pop) could have been repaired any number of times.

With a private owner (not ltd co.) it's just as easy to pay cash for work done.

With many avionics firms preferring to generate typed-up A4 logbook certificates (over writing entries into the airframe logbook), and with these notes being easy to "lose"....

If a plane is dodgy, the selling member keeps mum, and the remaining members keep mum (which they usually will; it's not in their interest to have a member who wants out but can't), there may be no way to avoid ketting shafted.

The one thing which should be apparent is a plane that's got a long good or a long bad history. But a huge one-off just around the corner cannot be guarded against.

All this stuff is very negative of course, and I suppose it means that the people in the group matter more than anything else, because you just have to trust them.

Most shares are great, professionally run and good experience.

As to the above quote, how would you avoid the bill if you bought the whole plane.

The great thing is that you only have to pay 25% of the bill not all of it which is why the group model works so well. Remember also the limit of your liability is the cost of the share. If it costs more than that to fix you can always walk.

Caveat emptor, do not pay into a share what you cannot afford to lose.

If you bought the whole plane you would first spend best part of £1000 on an inspection, equivalent to an Annual but obviously with no remedial work done.

This should include a borescope of the engine; essential as many planes spend months standing around rusting away externally and internally. Other things e.g. oil tests could be done.

Whereas the buyer of a share won't be able to do any of that. Not without appearing like he thinks the rest are a load of crooks.

You've got to know and trust the others.

Just a further thought - in my experience big syndicates are the way ahead!

For some reason, a great many people are very content to buy shares and then fly single-figure hours per year.

This is great for the rest of us, since they are still apparently content to pay their monthy subs, and have no choice but to pull their weight with aircraft cleaning occasionally (actually, this last may not be true) - but effectively subsidise the rest of us who actually want to fly the machines.

G

I've been in a group of four with a C120 for 7 or 8 years now, the other members have come and gone over that time; I'd say it's a great way to go if you keep a sesible head on. We paid £17K for the aeroplane and currently charge £35 pm and £25 per hour wet. Lots of fun and very cheap flying.

Make sure you know who you are geting involved with, keep the number of shares low (both to improve availability but, more important to reduce the risk of people you don't know very well doing things which will cost you lots!) and be prepared to do your shere of the comunal work (I do the accounts and am the group FI, another guy does the engineering etc etc). I'd recommend a simple aeroplane too as this reduces the risk of expensive mistakes.

Happy landings

3 Point

Englishal :
Could be interested - what sort of type did you have in mind ?