Is there any profit in refurbishing aircraft?

Short answer to the original question....NO
I had a chance to buy a PA-12 that had been in the garage of my friends Dad for 20 plus years after he bought it as a refurb project. It had most of the fabric still attached with large holes, the engine case and every cylinder were cracked, everything there but some bent ribs. He wanted $9000! I told my friend (close friend that you can say this stuff to) is he going to pay me $9000 to haul it off?
I like doing fabric work. I started pricing everything that I could think of to restore. Hoping for no bent frame members but it would have to be blasted, new linseed oil in the frame etc. Long story short I figured I could restore it to pristine condition in two years and approx 42K to 50K and I am an A&P IA. I went on Trade A Plane and found the same year model that had been restored for 40K....how much is my free time worth?

The sunburnt, ratted out plane sitting on the ramp will be more expensive, even with free labor to restore than buying a serviceable and flyable aircraft almost 100% of the time. I agree with you that it is a sad fact but in my experience, those are the facts.
 
MD11Pilot said:
Short answer to the original question....NO
I had a chance to buy a PA-12 that had been in the garage of my friends Dad for 20 plus years after he bought it as a refurb project. It had most of the fabric still attached with large holes, the engine case and every cylinder were cracked, everything there but some bent ribs. He wanted $9000! I told my friend (close friend that you can say this stuff to) is he going to pay me $9000 to haul it off?
I like doing fabric work. I started pricing everything that I could think of to restore. Hoping for no bent frame members but it would have to be blasted, new linseed oil in the frame etc. Long story short I figured I could restore it to pristine condition in two years and approx 42K to 50K and I am an A&P IA. I went on Trade A Plane and found the same year model that had been restored for 40K....how much is my free time worth?
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Do the same thing with a PA18 that you pull out of a garage for $9000 and you'll clear a tidy profit. The work required between a PA12 and a PA18 is probably not that much different but you have customers willing to pay 75+ for the finished product.

Your experience also illustrates another problem with the commercial refurbs. They are competing with hobbyists who do the refurbishment because they are emotionally attached to the plane. When it comes to sell, they still sell at market rate. A creampuff PA12 is still a PA12.
 
Labor alone for a Cub restoration is $60,000. That's the average after doing three @$60 hr. The last one with 27 STCs and several field approvals with new Airframes Alaska fuselage and Dakota cub wings was $225,000. He could sell it for $250 pretty easy.
 
yakdriver said:
Labor alone for a Cub restoration is $60,000. That's the average after doing three @$60 hr. The last one with 27 STCs and several field approvals with new Airframes Alaska fuselage and Dakota cub wings was $225,000. He could sell it for $250 pretty easy.
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How much is a re-cover, strip+paint the metal and a reman engine?

What you describe is the building of a new aircraft around an old dataplate, not refurbishment of an existing plane.
 
That is correct it was a total and has very few parts from the original airplane. Labor to do a total refurb on a Cub would be a little less but if going that far most opt to get rid of the antiquated wiring, instruments etc. Also upgrade landing gear, engine, propeller and STOL devices. The one I just finished is one of the most highly modified certified Cubs around so it was spendy. Doesn't really stall and will fly straight and level in the low 20's.
 
Maybe the most entertaining PoA thread of all time
 
I got a good laugh out of the Alex Siemens account on the icing thread
 
Had this discussion this past weekend with my A&P... to put it bluntly... "if there was money in it I would be doing it.. but right now I need 36 hour 9 day week to keep up with the work I have."
 
Ventucky Red said:
Had this discussion this past weekend with my A&P... to put it bluntly... "if there was money in it I would be doing it.. but right now I need 36 hour 9 day week to keep up with the work I have."
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There's plenty of money in it...for Aircraft Spruce etc...
 
azblackbird said:
@MD11Pilot ... would I be offending you if I were to ask you some questions? Say the word and I'll PM you off board.
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btw...if you have buyers I could hook you up. Let me know your needs and I can quote you an FOB landed refurb cost. My hourly shop rate is $150/hr.
 
mtuomi said:
There's plenty of money in it...for Aircraft Spruce etc...
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Yes if you're an average Joe... but if you're making a business out of it I am sure you could by-pass the "jobbers" and go direct to manufacture or work a pretty deep discount with Spruce, etc... once the volume starts to pick up.

In my business some of my distributors practically give the products away at published cost plus at the most 3%. They do this to maintain an inside deeper discount level with us and to keep their customer's form going direct... think inventory management.
 
Ventucky Red said:
Yes if you're an average Joe... but if you're making a business out of it I am sure you could by-pass the "jobbers" and go direct to manufacture or work a pretty deep discount with Spruce, etc... once the volume starts to pick up.
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Any parts that couldn't be made in-house would be sourced from the same places that Spruce gets theirs. Thus the reason for staying with the 182/210 series. When setting up an account with most manufacturers they require a minimum buy to get the keystone. Not a problem. ;)
 
azblackbird said:
It must suck to be so naive... ehhh kiddo? You do know that any manufactured part you buy has a labor component built into it... right? You should have learned that in grade school. :rolleyes:
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let us know how that works out for ya....ya might want to do a lil research on who can produce aircraft parts. :D
 
This AzzBackwards guy knows more than the FAA and all the A&P/IA guys combined. Stop asking him questions because we're all too stoopid to understand his vast intellect. He was using the Internet before Amazon, don't forget. If he wants to manufacture aircraft parts in his shop then he can do it because he said so, and he'll fly them to customers on his private pilot ticket.
 
Lachlan said:
This AzzBackwards guy knows more than the FAA and all the A&P/IA guys combined. Stop asking him questions because we're all too stoopid to understand his vast intellect. He was using the Internet before Amazon, don't forget. If he wants to manufacture aircraft parts in his shop then he can do it because he said so, and he'll fly them to customers on his private pilot ticket.
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Out of the mouth of babes. :rofl:
 
azblackbird said:
Any parts that couldn't be made in-house would be sourced from the same places that Spruce gets theirs. Thus the reason for staying with the 182/210 series. When setting up an account with most manufacturers they require a minimum buy to get the keystone. Not a problem. ;)
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Again, you would be better off working with the Spruce, Chiefs, etc... of the world in getting a discount and let them be your inventory manager. Understand that sitting inventory cost money along with you start dealing with a variety of vendors, now your spreading your OTB and creating additional expense with administrative work.

Regarding making "parts in house" why would you open yourself to liability with these parts, when you can pass this on to someone else..

Case study.. a buddy of mine runs a yard that works on boats... we're talking the big oil rig service boats, tug boats, fishing boats, tourist cattle boats etc.. in the Los Angeles harbor. They have stuff coming in from all over the west coast to be worked on.. they are pretty big and very well known for what they do... you with me??? They work all most exclusively with West Marine's distributor arm called Port Supply.... they can buy direct with many of the manufactures but go this route for about 90% of the stuff they need. Why do you think they do this? Inventory and logistic management is a big factor.. Also, they use to do the yearly life boat/raft inspections and service in house... not any more.. two reasons, "liability pass through" and not their expertise.

AZ.. I would like very much for you to succeed in this... but let me part some words of wisdom my father gave me at an early age... "a smart man learns from his mistakes, a wise man learns form a smart man" got it?
 
Ventucky Red said:
Regarding making "parts in house" why would you open yourself to liability with these parts, when you can pass this on to someone else.
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How many lawsuits do you know of right now that are pending or have been settled on those manufacturers that offer parts or STC's for sale or license? Please let me know your answer. I'm too lazy to pull the data right now.

Lachlan said:
Better than out of the opposite end of a donkey.
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@Lachlan ...instead of going through life as a naive DA who thinks he’s the Kool Kid on the block by hurling ad hominems at people who broach a subject that’s out of his realm or knowledge base... how about I give you the opportunity to impress all your Mensa buddies here (you know, the WE that you always speak of), and ask me the tough questions.

Here, let me get you started...

AZBB you said you were going to manufacture your own parts. What FAA regulation gives you the authority to do so?

Read this

"Owners and operators may produce articles for installation on their own product without a PMA. The installation of these articles must comply with applicable airworthiness standards to preserve the regulatory compliance of their products and ensure continued safe operation. If an owner or operator intends to sell an article for installation on another owner’s aircraft, then they need a PMA".

AZBB do you plan on purchasing/licensing STC’s from various manufacturers?

Yes, there are many manufacturers that offer STC’s for engines, performance upgrades, etc. We’ll be researching those that we want to implement on the planes we plan to refurbish.

Just an FYI... I got a pretty thorough grilling by one of the board members here yesterday who graciously offered his consulting services. Unfortunately due to time constraints we were only able to barely scratch the surface. I look forward to his findings and much further questioning on whether this would be a viable businesses venture... or not! ;)
 
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azblackbird said:
How many lawsuits do you know of right now that are pending or have been settled on those manufacturers that offer parts or STC's for sale or license? Please let me know your answer. I'm too lazy to pull the data right now.
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Have at it dude... let us know when your first plane rolls off the line.. you seem to have it all figured out..
 
Checkout_my_Six said:
yer gonna make parts?...using shop labor?:popcorn::lol::goofy:
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Apparently those are going to be produced through the 'owner manufactured parts' exemption. Maybe that makes sense if you have A&P labor at $25/hr available to you.
 
azblackbird said:
"Owners and operators may produce articles for installation on their own product without a PMA. The installation of these articles must comply with applicable airworthiness standards to preserve the regulatory compliance of their products and ensure continued safe operation. If an owner or operator intends to sell an article for installation on another owner’s aircraft, then they need a PMA".
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Owner produced parts are fine for an aircraft that you own, it would be interesting to see whether the FAA has ever weighed in on the circumstance where the aircraft is owned by a commercial venture, using the parts for the purpose of eventually reselling the aircraft. Does anyone know if that is possible?

I do wonder what that would do for the long term resale value, though. A number of owner produced parts in the logbook.
 
CMongoose said:
Owner produced parts are fine for an aircraft that you own, it would be interesting to see whether the FAA has ever weighed in on the circumstance where the aircraft is owned by a commercial venture, using the parts for the purpose of eventually reselling the aircraft. Does anyone know if that is possible?
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Yeah... let's ask the Mensa's here. :rofl:
 
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