Lots of us come up with New Year’s Resolutions. While most experts agree that the Dead of Winter Post-Christmas Doldrums are not the best time for these things, they live on as strong as ever. So here are a couple resolutions if you are in the market for an aircraft.
Resolution #1. I will do my research. I will have my mission performance parameters defined. I will be realistic – we all want more speed and more range. What do I truly need versus what would I like to have? I will know the difference between the two. I will use "required" and "desired" criteria. This typically involves things like payload, range, speed and take-off/landing capability. They are measureable. Required criteria are those performance items that the aircraft must meet in order to be successful at accomplishing the mission. Desired criteria are the nice-to-have items that, although not necessary for mission accomplishment, will enhance the ability of the aircraft to perform the mission. Desired criteria enable you to better differentiate between the various aircraft.
Resolution #2. I will look at the total costs of owning and operating the aircraft, not just the acquisition price. Older aircraft cost less to acquire, more to operate. The bargain price on that used model may not reflect the true cost of getting it into service. Does the aircraft have a low acquisition price but need paint, interior, and avionics upgrades and have high-time engines?
What about sales taxes? Property taxes? Will the aircraft be used for business so that we can take tax depreciation expenses?
If my engines are not on a guaranteed maintenance program, have I enough of a reserve to cover the major inspection or overhaul? Don’t forget rental engines and the possibility of unscheduled maintenance.
What am I going to do once I have this plane to maintain its value? Will those new avionics add value, or just add “fun” to my aircraft?
Resolution #3. Am I prepared to place the aircraft into service? Do I need training? Do I have the hangar space? Am I prepared for the maintenance requirements of the aircraft? Do I need to get spares or additional tooling or ground support equipment?
Resolution #4. I will get my acquisition team together sooner than the day of closing! I will need technical expertise in aviation and finance. I will also need legal and tax advice. If trading/selling one business aircraft for another can I take advantage of a tax-deferred exchange? Have I talked with my insurance broker to inform them of the aircraft choice?
Overall, I resolve to make my next aircraft acquisition go as smooth as possible. I realize that this takes advance planning and preparation.
Remember the 5 P’s: Prior Planning Prevents Poor Performance! (OK, some of you can add a sixth “P” if you know what I mean).