Owning more expensive than renting

wrote:

If we
sold the plane for fair market value and put the proceeds in a safe
investment paying 6% interest, the (lost) income would work out to about $28
per flight hour, which would put the total cost very much in line with
renting.

Safe investments (like bonds) these days are bringing in about 1.5%, and have
been for nearly two years. 2001 was the last year you could count on something
like 6% from one of those accounts.

George Patterson
The desire for safety stands against every great and noble enterprise.

wrote in message
news:Qx1xd.2733$tG3.1799@trnddc02...

My two co-owners and I recently tried to calculate the actual per-hour
cost
to fly our Arrow IV. At our current annual usage of around 170 hours,
this
number came to just under $100/hr (tach time), which is well below what an
Arrow would rent for in this area. We thought we were doing pretty well,
especially since we pay the extra cost to keep our plane hangared (which
is
rare for rental planes around here).

Using a rental aircraft for business flying is tenuous at best.

IAC, I calculate that my B36TC runs $165 an hour for everything -- 430 hours
in the past 12 months including hanger fees of $3000 annually. One big
factor is your location; it's going to be much more expensive in an
expensive town/city/state.

I don't recall EVER seeing a B36TC for rental. Also, when we need to travel
its often (about 1/3 of our flights) on an hours notice.

Lastly. one thing missing in many rentals is the ability to do a RON.


Matt
---------------------
Matthew W. Barrow
Site-Fill Homes, LLC.
Montrose, CO

On 18-Dec-2004, "Matt Barrow" wrote:

Using a rental aircraft for business flying is tenuous at best.


You got that right!!
--
-Elliott Drucker

Matt Barrow wrote:

Lastly. one thing missing in many rentals is the ability to do a RON.


RON?

xyzzy wrote:

RON?

Remain OverNight.

George Patterson
The desire for safety stands against every great and noble enterprise.

I have rented / owned / owned and rented / leased / borrowed (never
stole though / airplanes my entire adult life... I could teach an
entire PhD course in the uneconomics of airplanes... Among the several
things I have learned along the way is that owning is more expensive
than renting - period! There will be the occasional bright guy, like
Roger, who can make the numbers work out in favor of owning - I have
never been able to make that happen...

But, renting affects me... Every time I have flown a rented airplane I
am concious of the Hobbs meter running... It affects my decision
making... If I am on the way somewhere and the thought comes up, "Gee
if I deviate a half hour to the West we can fly over the St. Louis arch
(or some such)... In a rented plane it doesn't happen because both
conciously and subconciously I can see that &*^$@# meter running... In
my own airplane, it's a slam dunk - we ARE going to fly over the arch
(or whatever)... I will drive 20 miles out to the airport just to make
two circuits around the field with crosswind landings, 20 minutes of
flying just for fun... I won't do that in a rented airplane... I will
go to the airport on a really bad weather morning just to vacuum the
carpet and polish the spinner... I won't do that in a rented
airplane... I will go to the airport at 2AM just to go fly lazy
circles for 40 minutes to look at the moon and the stars (stress
relief)... I won't do that in a rented airplane... I wll arrange a 3
day weekend to fly down to Florida and sit on the beach for a day... I
won't do that in a rented airplane...

Bottom line "for me" is that I have to own... For you it may be
different... I would urge those who rent to consider a club ownership,
or a partnership deal... Owning makes a huge difference in how you see
the airplane and in how you use it... How many of you would consider
renting your car? Not many... But for those who have cars on lease,
how many of you are always concious of the miles accumulating on trips?
Every one of you, I bet, because going over mileage on the lease
contract carries a big $$ penalty..

Cheers ... Denny

On 19 Dec 2004 06:02:40 -0800, "Denny" wrote:

I have rented / owned / owned and rented / leased / borrowed (never
stole though / airplanes my entire adult life... I could teach an
entire PhD course in the uneconomics of airplanes...

Good one, I'd never heard the term ueconomics before.

things I have learned along the way is that owning is more expensive
than renting - period!

I have been fortunate, my ownership costs have been around $68/hr for
a Cherokee 180, but this is not including engine overhaul reserve,
aircraft depreciation due to increased TTAF, the new paint job,
avionics updates, Knots2U mods, opportunity cost of money, and the
countless hours I've spent working on the plane (which I enjoy).

A nice Cherokee 180 or early Archer rents for ~$90 wet in Chicago
area, so there's no way I'm coming out ahead. On the other hand,
that's not why I own.

This is for ~200hrs / year of flying.

-Nathan

Nathan Young wrote:

On 19 Dec 2004 06:02:40 -0800, "Denny" wrote:


I have rented / owned / owned and rented / leased / borrowed (never
stole though / airplanes my entire adult life... I could teach an
entire PhD course in the uneconomics of airplanes...


Good one, I'd never heard the term ueconomics before.


things I have learned along the way is that owning is more expensive
than renting - period!


I have been fortunate, my ownership costs have been around $68/hr for
a Cherokee 180, but this is not including engine overhaul reserve,
aircraft depreciation due to increased TTAF, the new paint job,
avionics updates, Knots2U mods, opportunity cost of money, and the
countless hours I've spent working on the plane (which I enjoy).

No, your ownership costs have been way higher than $68/hours. Your
direct operating costs may be $68/hr, but not your ownership costs.


Matt

"Denny" wrote in message
ups.com...
I have rented / owned / owned and rented / leased / borrowed (never
stole though / airplanes my entire adult life... I could teach an
entire PhD course in the uneconomics of airplanes... Among the several
things I have learned along the way is that owning is more expensive
than renting - period! There will be the occasional bright guy, like
Roger, who can make the numbers work out in favor of owning - I have
never been able to make that happen...


Let's have a show of hands from all those who drive a Hertz (okay...Budget)
rental car instead of your owned/leased vehicle?

Anyone? Anyone at all?

The economics and justifications are the same -- UTILIZATION and frequency.

If we drove once every six months using Hertz might make sense.

Way too many people use aircraft for pleasure or marginally "profitable"
business. If you make $25-50 an hour, you can't justify too much for flying
expenses, or if you make $200 an hour, but only for a day or so.

When I started my business back in 1996, I tried using rentals while getting
the business started. It worked, but was very constricting. In the first
year I got a T182, then a T210, then four years ago a B36TC. I started with
a radius of business of 150 miles, then 300 and now I go from Great Falls
down to North Texas, from SLC east to Omaha. I build houses and usually
never more than ten in any one town, usually smaller towns. I couldn't do
that with rentals or airlines/commuters. The aircraft I owned never cost me
more than about $85,000 a year (everything included), but enabled us to
build the company into a $4.5M business. As I mentioned in another post,
what I use/"am looking for next", don't come on the rental market.

Now I'm looking for all weather capability, thinking of a turbo-prop. We're
putting together two projects to build a total 55 houses in two
towns....more than we now build in a year. Budget looks like $9.75M. There's
usually three or four of us that have to travel together, 550nm and 600nm .
Any suggestions?

Too many people let their ego get in the way of making a sound justification
for an aircraft purchase. The economics don't pan out unless you can have
the tax man help you,


--
Matt
---------------------
Matthew W. Barrow
Site-Fill Homes, LLC.
Montrose, CO

Matt Barrow wrote:

If we drove once every six months using Hertz might make sense.

Exactly. During that unfortunate period in my life when I was living in
Philadelphia, I drove once every few months. I rented.

- Andrew