buy or rent a 2006 182

"Andrew Gideon" wrote in message
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On Fri, 25 May 2007 11:08:26 -0500, Dan Luke wrote:

So I ran a few
numbers to see how buying and renting the same model airplane would
compare, based on costs here in Mobile:

I've a problem with your numbers; I don't see how they can be correct.
It's not any specific number you've described, but the overall sum.
Essentially: how can the two work out to anything but the rental costing
the same or more?

Both aircraft are insured (and, apples to apples, I assume they're insured
identically). Both would have the same hourly into engine/paint/interior
reserves. Both use the same fuel and oil. both get the same annual, etc.

Renter's insurance is an added expense on the rental side, as is funding
the 100 hour inspections.

You're right that the renter avoids financing costs (whether aircraft is
bought for debt or cash).

The renter pay ALL costs, including financing (unless the club/owner paid
cash).

What would be different, possibly by way of being more diversified, would be
the fixed costs. For instance, how many rental aircraft are hangared? Fixed
costs are going to be lower per hour as a rental aircraft is used more
often, usually by orders of magnitude. It's this that makes renting more
economical if the utilization is MUCH less with ownership.

But the owner of the rental presumably knows
this and figures it into the hourly, making the per hour charge for the
rental slightly higher.

A rental aircraft is still owned and the owner needs to recoup their costs
as well as make a profit.

What am I missing that would "break" what I've described?

Possibly insurance, as a rental aircraft has to be insured for various level
of pilot experience. If you have 2000 hours as an owner, the rentor still
has to cover for someone with 100 hours. Also, possibly, the 100 hour
inspections that an owner isn't required to perform...

"Matt Barrow" wrote in message
...

A rental aircraft is still owned and the owner needs to recoup their costs as
well as make a profit.

This is unfortunately not always true. Ask most any leasback owner. Most
of them lose money in the deal. The lucky ones make it up in tax advantages.

Also, I have seen many flight schools come and go over the years.

Vaughn

"Vaughn Simon" wrote in message
...

"Matt Barrow" wrote in message
...

A rental aircraft is still owned and the owner needs to recoup their
costs as well as make a profit.

This is unfortunately not always true. Ask most any leasback owner.
Most of them lose money in the deal. The lucky ones make it up in tax
advantages.

Also, I have seen many flight schools come and go over the years.

So...let's see: They're pricing it wrong?

"Matt Barrow" wrote in message
...

Also, I have seen many flight schools come and go over the years.

So...let's see: They're pricing it wrong?

Often a school's rental price structure has more to do with local market
forces than it has to do with costs and a proper return on capital investment.
Another factor is that great aviation folks are (way too often) not great
business people.

Vaughn

"Vaughn Simon" wrote in message
...

"Matt Barrow" wrote in message
...

Also, I have seen many flight schools come and go over the years.

So...let's see: They're pricing it wrong?

Often a school's rental price structure has more to do with local
market forces than it has to do with costs and a proper return on capital
investment. Another factor is that great aviation folks are (way too
often) not great business people.

And that can make renting more expensive in other ways than direct costs
(i.e., losing the aircraft availability).

"Matt Barrow" wrote in message
...
And that can make renting more expensive in other ways than direct costs
(i.e., losing the aircraft availability).

Then most of us just move on to the next flight school/FBO. A quick check
flight and you are on your way. (Of course, if you live in a small town your
choices may be somewhere between limited and nonexistent.)

Vaughn

"Vaughn Simon" wrote in message
...

"Matt Barrow" wrote in message
...
And that can make renting more expensive in other ways than direct costs
(i.e., losing the aircraft availability).

Then most of us just move on to the next flight school/FBO. A quick
check flight and you are on your way. (Of course, if you live in a small
town your choices may be somewhere between limited and nonexistent.)


I used to (ten years ago) live in a medium size town (170,000) and there
was one FBO and one club. I recently moved from a small town (30,000), where
there was one FBO and one club with three aircraft.

The point is that renting has to be more expensive than buying (and using it
100+/- hours) as the costs are the same. That FBOs and clubs are
inefficient business people is only peripherally a factor.