Friday, August 1, 2003
Project Bonanza Part I
By buying a used airplane and weighing its pros and cons, you can settle on a plan to make an “almost” airplane into one that’s “just right”
Now that we were well-settled into our carefully planned aircraft ownership, up popped our first annual, which turned out to be quite an experience. If you’d like the first hint on how things went, it was scheduled for September 11, 2001. To see how this Bonanza fared, read the next installment of “Project Bonanza” part II below.
The Downward Ownership Cycle
As the buyer of a used aircraft, you should be aware of the downward ownership cycle. The most important point of this cycle to a buyer is the last year or two with the previous owner. As aircraft usage decreases in the typical scenario, the maintenance also decreases and, unfortunately, the new owner gets the associated problems. So, knowing about the cycle is helpful in thinking about your budget. Here are a few tips that we’ve gleaned from our Project Bonanza experience about the unpredictable ownership cycle:
• Most airplanes seem to follow a three- to five-year ownership cycle. The first year is full of activity. The plane is flown often and the owner spends money on airworthiness and upgrades.
• In the second to third year of ownership, aircraft use typically drops off dramatically. Either the cost or the time commitment of airplane operation overwhelms many owners. The airplane starts to suffer the effects of lack of use—seals begin to dry out and corrosion (of the airframe and inside the engine) begins, as moisture is not regularly “flown out.”
• In the third to fifth year of typical ownership, it becomes harder and harder to justify the expense for the number of hours flown. Those new avionics installed in the first year begin to be out of date. Usage drops further; the airplane suffers and the pilot suffers from lack of recency—which makes him or her less comfortable flying the airplane, causing usage to drop even more.
The result is that mostly minor, but sometimes major, maintenance is postponed. Of course, some owners don’t fall into this spiral. But many do. The emotional pilot may keep the airplane, turning it into a “hangar queen” or one of those you see tied down on the ramp with flat tires and weeds growing up to its belly. The more logical (or financially desperate) owner will sell the airplane—and the cycle begins again.
The buyer’s concern is to know as much about these potential problems as possible, so always spend the time to study the maintenance history of the aircraft and look for a strong continued maintenance program. For your own good, know what to budget for healthy maintenance.
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