Sport Pilot Talk

So I know there are a bunch of folks with strong feeling about allowing their plane for rental or not, but instead of the benefits/pitfall discussion, for which I have seen plenty, I would like to find out what planes are allowed to be used as rentals for getting ones LSA license.

Of the 3 I know of which may I rent out:
S-LSA: I kinda think this one is an obvious yes.
E-LSA: ?
EAB that meets the limitations of an LSA: ?

And for bonus points, how is the maintenance handled on each once used as a rental?

As far as I know you cannot rent out an "experimental" aircraft.

SLSA is the only one you can rent out without any issues. The FAA announced a possible change to allow for the rental of a ELSA under certin circumstances, but I think it will be for specialized training in specific make and models.

Having done 1,000 plus hours of flight instruction in LSA, with most of it in Flight Design aircraft, I would say get the simplest LSA you can get. You don't need a fire breathing triple glass panel for flight training. Speed doesn't matter, because it is hours that you need, not distance flown. Look for good factory support, and parts availability. The more rugged the airplane the better. Also watch for useful load. Many of the LSA become limited with instructor, student, and fuel.

As mentioned, SLSA is the only one that can easily be put in a rental fleet.

I have seen Experimental-Exhibition and Experimental-Amateur Built get a Letter of Authorization from thier FSDO to provide training if they filled a specific niche. In those cases they were a Sukhoi SU-29 and Pitts Model 12 that were used for aerobatic training.

The aforementioned NRPM that will ease the path of ELSA to get a similar LOA is still a ways off. So right now the fastest solution is SLSA.

Don't forget the light classics, Cubs, Champs, etc.

An S-LSA with enough useful load to carry a student, CFI, and fuel. Unless it's a vintage aircraft, be prepared to spend $60,000 or more and $4,000 or more per year for insurance. Also, unless it's a metal aircraft, you will need a hanger. If you really want to do this, check your local FBO's and see if they are interested in doing a lease back.

Make sure you understand the potential liability issues. As owner, even if you do an LLC, you can be held liable if anyone gets killed in the airplane or on the ground. I would never enter into such a situation. Of course, that's why you have insurance, but you can never have enough insurance to protect yourself in all situations.

For, instance, a young doctor gets his Sport Pilot certificate and takes his doctor friend for a ride. They go out and buzz their hospital and crash killing themselves and several on the ground. Your life, as you know it, is over. At least that's a possibility, because you never know what a jury will decide and award. I have nothing against doctors, but juries will take into account their lifetime earning potential in awarding damages to the widows.

Someone will say that this is a "glass half-empty" viewpoint, but it is reality. It's also why you should think twice about who you take for a ride in your airplane.

EDIT: I will also add, do you really want new students learning to land in your LSA? Some of these have fragile landing gear, especially the nose wheel. A collapsed nose gear will likely result in an engine tear down. Obviously, I'm not a fan of renting out your aircraft unless you're in the airplane rental, flight training business. I would rather buy what you can afford to own and fly yourself.

PS: Rental aircraft require 100 hour inspections in addition to annual inspections.

Yes, running a business comes with risks. With risks come rewards.
Most of us rented airplanes for all or most of our training. Most training aircraft are 50 years old. Still flying. Havn't killed anyone.
Flight schools are in desperate need of rental light sport aircraft.
Run your numbers.
Purchase a used solid aircraft such as the Tecnam P92 I own.
My airplane has over 2000 hours of student flying since 2006.
It is in excellent condition.
If everyone was scared of going into business, there would be no businesses.

Usually, a viable business would have significant profit potential. I'm not sure renting out your LSA has enough profit potential to justify the risk potential, but that is obviously a decision each person needs to make. If it was a great idea, there would be no shortage of LSA available to rent. I'm just pointing that out to the OP as something he needs to consider.

We have had several fatal accidents at my airport in the last couple years, including the CFI who checked me out in a SkyCatcher. It happens more often than you might think. The SkyCatcher I almost bought 2 years ago was totaled last month by a licensed Sport Pilot.

And yes, you can stick your head in the sand and justify almost anything. My point is be prudent and evaluate all the angles, pro and con.

TimTaylor wrote:
And yes, you can stick your head in the sand and justify almost anything. My point is be prudent and evaluate all the angles, pro and con.

Who was advocating that he should “stick your head in the sand and justify almost anything”?
Wasn’t the Op being prudent and attempting to evaluate all angles by posting to this forum?

I have never seen a lease-back financial analysis. Maybe someone here has one they can share with you. After you cover your variable cost including fuel, oil, maintenance (planned and repairs), engine hours, aircraft wear and tear, FBO fees and profit, etc., is there much left to apply toward your fixed cost? Of course, you would get the tax benefit of writing off some of your expenses and depreciation. However, as you know, the depreciation gets washed out when you sell the airplane.

Type47 wrote:

TimTaylor wrote:
And yes, you can stick your head in the sand and justify almost anything. My point is be prudent and evaluate all the angles, pro and con.

Who was advocating that he should “stick your head in the sand and justify almost anything”?
Wasn’t the Op being prudent and attempting to evaluate all angles by posting to this forum?

I simply advised him to consider the potential risk, and pointed out what they might be. You seem to be saying to ignore the risk.

"If everyone was scared of going into business, there would be no businesses."

Not every "potential business" is a good idea. What is the EMV of renting out an LSA? Are the benefits worth the risk of a "worse case scenario?" To me, they are not. I have much more to lose than the small benefits would ever justify. I have owned 3 airplanes and never had any desire to rent them out.

This is an opinion I should be able to express here.

I have not said,nor would I say, to ignore the risk.
Thank God some people think it is worth the risk or many here would not be flying.

TimTaylor wrote:I have never seen a lease-back financial analysis. Maybe someone here has one they can share with you. After you cover your variable cost including fuel, oil, maintenance (planned and repairs), engine hours, aircraft wear and tear, FBO fees and profit, etc., is there much left to apply toward your fixed cost? Of course, you would get the tax benefit of writing off some of your expenses and depreciation. However, as you know, the depreciation gets washed out when you sell the airplane.

I failed to mention insurance as one of your variable expenses. It might be the largest. It's variable because if you don't rent your aircraft it will be much less than if you do rent it out, so in that regard, it's a variable expense.

EDIT: And another risk I failed to mention is that renters may not take as much care of your airplane as you would. For instance, would they over-rev the engine or allow it to become over-heated? Would they tell you if they made a hard landing? Probably not. These are all factors to consider if you plan to rent out your airplane.

My approach is not foolproof, but it does minimize risk. I will only rent my plane to my own graduates. And, I will only graduate those students to whom I would be comfortable renting my plane...

And, as has been indicated above, insurance is indeed my largest single operating expense - slightly more than consumables, and almost twice as much as office and hangar rent.

drseti wrote:My approach is not foolproof, but it does minimize risk. I will only rent my plane to my own graduates. And, I will only graduate those students to whom I would be comfortable renting my plane...

And, as has been indicated above, insurance is indeed my largest single operating expense - slightly more than consumables, and almost twice as much as office and hangar rent.

Paul,

What is your formula for a successful aviation enterprise?