E/AB buyers guide

Are you building/buying/flying an Experimental Amateur-Built (E-AB) or Experimental Light Sport (E-LSA) aircraft? Converting an S-LSA to E-LSA? Changing or adding equipment, or otherwise modifying an S-LSA? Need help with Letters of Authorization? Or maybe designing your own aircraft? This forum is the place to discuss All Things Experimental.

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Atrosa
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Re: E/AB buyers guide

Post by Atrosa »

Thanks to everyone for sharing thier experiences. I do not get offended or upset very easily so don't worry about what you write. I understand that everyones situation is different therfore i expect a significant range of costs of flying. I do however want to hear everyones experience. I'm a data guy so the bigger the data set the better my estimates.

A little about my thoughts. Whatever plane i choose will be a toy in my mind. And for all my toys I will not go into debt. My geneal rule in my household is we dont borrow money. That said once i drop 40-70k on this toy i will not include depreciation as an expense as i consider it fully depreciated the day i wire the cash.

What I'm first trying to understand is how much does it cost to own if i dont start the engine. Im thinking $300 per month. Local airport has tiedown space for about $100 per month. Insurance seems to be about $100 per month. The annual needs to be done by the passage of time so about another $100 per month there.

For the variable stuff...starting her up i think will cost me about 60-80 per hour for consumables&rebuild funding. I'm hoping to understand all my cost to limit surprises.

I also realize there are AC specific costs such as ADS-B costs to be 2020 compliant, rotax 5 year rubber, zodiac wing upgrade, Arion MK2 elevator upgrade, sportcrusier front gear upgrade, BRS repack cost.......and so forth. Those i will save for when i get closer to an actual offer.

But please please please keep the information coming. Do not change your experience to influence a desired outcome. 2 months ago i did not have anywhere near this knowledge and 90% of my learning is coming from this site and more importantly each contributor.
TimTaylor
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Re: E/AB buyers guide

Post by TimTaylor »

Since you are a new student pilot, I think you should at least double, maybe triple, your insurance estimate. Also, unless you purchase a metal airplane, you will probably want to keep it in a hanger to prevent UV degradation. Also, find out what property tax will be where you are.
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drseti
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Re: E/AB buyers guide

Post by drseti »

Atrosa wrote: What I'm first trying to understand is how much does it cost to own if i dont start the engine. Im thinking $300 per month.
My fixed expenses are significantly greater than that - but mine is a flight school aircraft, in commercial service, so we're comparing apples and kumquats.

In my fixed expenses, I have to include hangar rent, commercial insurance (the dominant cost item in my budget), annual condition inspection, taxes, 5-year Rotax rubber reserve, and mandatory service bulletins. All told, they come to $900/month (half of which is just for insurance). I do not include depreciation as a fixed expense, since that is dominated by Hobbs hours.

Of course, the more hours my plane flies, the less the hourly impact of fixed expenses. So, my business plan includes a minimum acceptable utilization figure. I know my variable operating expenses ($60/hr). When my fixed and variable expenses are equal, I can rent the plane for $120/hr Hobbs (roughly what the local market will bear), and break even. That break-even figure amounts to 180 hours a year of aircraft rental. Anything over that level of utilization, and I'm profitable. Anything less, and eventually I go out of business.

Fortunately, for the past 9 years I have been averaging
240 rental hours a year, which suggests a modest $3600 annual profit (one never gets rich from aircraft rental). The rest of my income comes from instructional fees, DPE fees, UAS training courses, maintenance, and income from administrative functions.

None of this is relevant to private aircraft ownership, of course, except that holding fixed expenses and variable expenses roughly equal is kind of a sweet spot.
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chicagorandy
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Re: E/AB buyers guide

Post by chicagorandy »

Now I understand how the issue affects ME.

All MY money is tied up in groceries in the pantry and meat in the fridge.
lol
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TimTaylor
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Re: E/AB buyers guide

Post by TimTaylor »

chicagorandy wrote:Now I understand how the issue affects ME.

All MY money is tied up in groceries in the pantry and meat in the fridge.
lol
Unfortunately, Randy, that's reality for an ever increasing percentage of Americans. That's the real reason general aviation is dying. The percentage of people who can afford this hobby is getting smaller.

That said, if you can afford to rent and fly a couple hours a month, it's great fun. You don't have to own an airplane. You can also take a year or two to get a pilot certificate. There is no need to be in a hurry if you just love flying (Learning to fly is flying). It took me a year to get a Private, but I was in high school with little or no income.
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drseti
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Re: E/AB buyers guide

Post by drseti »

TimTaylor wrote:It took me a year to get a Private, but I was in high school with little or no income.
Hell, it took me 19 years from first lesson to Private! But that includes time in High School, College, and the Air Force (which strangely didn't require so much as a Student Pilot certificate).
The opinions posted are those of one CFI, and do not necessarily represent the FAA or its lawyers.
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FastEddieB
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Re: E/AB buyers guide

Post by FastEddieB »

TimTaylor wrote: In fairness, I should add that opportunity cost is a real cost that should be included when evaluating a purchase.
I stipulated to that.

Maybe we should include opportunity cost every time we make a purchase, be it dining out, buying a candy bar, buying gas, going to the movies - or buying an airplane. One can be aware of the concept of opportunity cost, but not consider it in day-to-day purchases.

Tim is right to consider it in the big picture. But most don't include it in a spreadsheet of costs. And that lets folks compare apples to apples. I'll venture there's no right way or wrong way. For what its worth.
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FastEddieB
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Re: E/AB buyers guide

Post by FastEddieB »

TimTaylor wrote:
chicagorandy wrote:Now I understand how the issue affects ME.

All MY money is tied up in groceries in the pantry and meat in the fridge.
lol
Unfortunately, Randy, that's reality for an ever increasing percentage of Americans.
There have been surveys that show that half of all Americans could not come up with $400 cash in an emergency.

I suspect that while members of this forum vary greatly in income and assets, I daresay most are heavily weighted towards the upper end of of the bell curve.
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TimTaylor
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Re: E/AB buyers guide

Post by TimTaylor »

If someone wants to know the true cost of anything, opportunity cost should be included. If I choose to include it in my spreadsheet, it's because I have a finance degree and 34 years corporate experience in doing so. If you want to know your out-of-pocket expense, ignore opportunity cost as well as any other fixed cost you choose. I know it's not a factor for you or most others on this site.

I try to paint the total picture because not everyone who is contemplating buying an airplane is as wealthy as some others. They may be asking their spouse or children to make sacrifices to support their aviation hobby. Or, they may not realize the impact this purchase could have on their future income and ability to live a comfortable retirement.

Why does it matter to you if I include this cost in my analysis? I have posted multiple analyses for people to read for themselves. They can download the spreadsheets and put in their own numbers. I'm not attempting to trick anyone or hide anything. And, there is nothing wrong with comparing apples and oranges as long as you know they are apples and oranges and you know the difference.
Last edited by TimTaylor on Wed Dec 19, 2018 5:45 pm, edited 5 times in total.
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TimTaylor
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Re: E/AB buyers guide

Post by TimTaylor »

FastEddieB wrote:
TimTaylor wrote:
chicagorandy wrote:Now I understand how the issue affects ME.

All MY money is tied up in groceries in the pantry and meat in the fridge.
lol
Unfortunately, Randy, that's reality for an ever increasing percentage of Americans.
There have been surveys that show that half of all Americans could not come up with $400 cash in an emergency.

I suspect that while members of this forum vary greatly in income and assets, I daresay most are heavily weighted towards the upper end of of the bell curve.
Unfortunately, maybe Randy is not one of them. He is still welcome here, I believe. By virtue of the fact that income inequality is skewing more and more toward the top, general aviation will continue to die. It's not because anyone is trying to discourage someone from buying an airplane, as has been stated by one poster here.
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drseti
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Re: E/AB buyers guide

Post by drseti »

TimTaylor wrote:they may not realize the impact this purchase could have on their future income and ability to live a comfortable retirement.
Ah, but my definition of a comfortable retirement includes having an airplane! ;)
The opinions posted are those of one CFI, and do not necessarily represent the FAA or its lawyers.
Prof H Paul Shuch
PhD CFII DPE LSRM-A/GL/WS/PPC iRMT
AvSport LLC, KLHV
[email protected]
AvSport.org
facebook.com/SportFlying
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TimTaylor
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Re: E/AB buyers guide

Post by TimTaylor »

Never mind. To much information.
Last edited by TimTaylor on Wed Dec 19, 2018 6:58 pm, edited 1 time in total.
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Warmi
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Re: E/AB buyers guide

Post by Warmi »

TimTaylor wrote:
FastEddieB wrote:
TimTaylor wrote:
Unfortunately, Randy, that's reality for an ever increasing percentage of Americans.
There have been surveys that show that half of all Americans could not come up with $400 cash in an emergency.

I suspect that while members of this forum vary greatly in income and assets, I daresay most are heavily weighted towards the upper end of of the bell curve.
Unfortunately, maybe Randy is not one of them. He is still welcome here, I believe. By virtue of the fact that income inequality is skewing more and more toward the top, general aviation will continue to die. It's not because anyone is trying to discourage someone from buying an airplane, as has been stated by one poster here.
The rich are getting richer and the poor are getting richer , just not as fast, so the gap is growing but ultimately a typical American can afford a lot more than 30 or 40 years ago so the aviation is not dying because of that - that’s actually complete nonsense.

You don’t need anything else - just a quick look at the Census data is plenty sufficient to dispel that myth.
https://www.aei.org/publication/yes-ame ... me-groups/

Aviation is dying because , for whatever reason , US manufacturers are unable to produce affordable planes - plain and simple. Is the utterly broken legal system, ridiculously overbearing FAA or a combination of multiple factors - who knows ?

Now, aviation will never be truly affordable but a 100K or so plane is within reach of many people who really want to fly and have a decent income - on the other hand a 400 k Cessna or 700 k Cirrus is basically a toy for ultra rich only.
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TimTaylor
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Re: E/AB buyers guide

Post by TimTaylor »

Never mind. I don't want to get into a political argument.
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Re: E/AB buyers guide

Post by TimTaylor »

I think I am going to stop posting here. My values are far different than most here and my "more liberal" viewpoints are at odds with most here. Expressing my opinions and views here is little more than pissing in the wind. I've tried to leave before, but keep getting sucked into threads that interest me. I'll try to resist in the future. I find posting here is more frustrating that rewarding.
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