Why do engine prices climb?

[Mike H]

Running engines are available as removed from damaged aircraft in the $8,000-$10,000 range. One just needs to do thier due diligence and personally inspect the core and logs....and buy from a reputable parts dealer or someone who is trustworthy. I disassembled and inspected a parallel valve IO-360 last winter that was bought for $8000. It was removed from a wind damaged aircraft and it turned out to be in great condition.

[ijustwannafly]

Originally Posted by Kyle Boatright

$8k was for a mid time used engine, circa 2000. At that time, new 4 cylinder engines were in the mid to upper teens, IIRC. At 3% inflation over 15 years, those $17.5k engines are in the mid- upper $20k region now.

You must be using the same math for this as you used above to explain how an engine rebuild cost $22k

You forgot with that retailers are also making profit on your 12k of parts as you stated above.

Just an FYI A commutative rate of inflation of 38.2% with a 15k new engine makes an engine today cost 20.7k and change not 29-32

[airguy]

The only real alternative today is some of the new diesel technology, which is coming out at the $60k-$80k price point. There is no economic incentive for Lycoming and Continental to keep their prices down. If you don't like it, what choice do you have?

[rbibb]

Costs to manufacture anything goes up each year.

Consider that the cost of labor is maybe a third, materials I'd guess 10-25%, outside subcontracted processes maybe 10% (or equivalent if done all in house. Then there is overhead - rent (or property taxes), electricity, water, gas, etc. Each of those goes up each year. Lately labor costs probably stagnate as wages have but when was the last time you heard of electricity going down or local taxes. And in labor its not just wages - what about that little thing called benefits, e.g. health insurance. Care to guess its trajectory? Some costs are fixed - as in rent or property taxes - they get allocated over the volume produced - produced more individual cost load less, fewer - more, etc. Think volumes are growing in last few years, I doubt it.

Last cost item is profit - which consumers hate to hear about until the company ceases to exist because it didn't make one.

Such is basic economics - something our political leaders often know nothing about.

So prices go up unless unit costs come down. Free lunches only exist in minds of DC pols. Thus endeth the lesson.

[ijustwannafly]

Originally Posted by airguy

The only real alternative today is some of the new diesel technology, which is coming out at the $60k-$80k price point. There is no economic incentive for Lycoming and Continental to keep their prices down. If you don't like it, what choice do you have?

Bingo was his nameooo

[mv031161]

Originally Posted by bret

For a rough estimate it looks like the average price of this prop turning thing has gone up 1,000.00 a year for the last 10 years? any economist care to jump in and explain? has inflation been this high or is there another factor at play here?

Textron which owns Lycoming and many other brands (including one I represent overseas) adjust their prices 3 to 5 % annually.

As a reference only: a 1997 Cessna 172S use to cost factory new delivery/ basic price $124,500. Move forward to 2015 and the same aircraft (newer avionics) cost $364,000. Reasons? Inflation is #1. Cost and availability of materials #2, believe or not TORT is #3 and Labor cost #4

[LettersFromFlyoverCountry]

Has anyone done on a survey on the value of RVs lately? If the value of a new engine is going up, does the value of a used engine go up too?

[ijustwannafly]

Originally Posted by mv031161

Textron which owns Lycoming and many other brands (including one I represent overseas) adjust their prices 3 to 5 % annually.

As a reference only: a 1997 Cessna 172S use to cost factory new delivery/ basic price $124,500. Move forward to 2015 and the same aircraft (newer avionics) cost $364,000. Reasons? Inflation is #1. Cost and availability of materials #2, believe or not TORT is #3 and Labor cost #4

I was just having this exact conversation the other day.
Just plane silly! All pun intended

I wonder how much of this is attributed to avionics.

The 172 has not changed much in a long time. Other then avionics i find it hard to believe cessna's cost has more then doubled for a 172.

I think cessna is going to have a real winner with the new 182 diesel but at a cost of $569k i don't know who they think they are going to sell it to.

One might argue its not exactly a fun airplane to fly (like an rv) but surly a capable one with a diverse mission profile.

[Jordan1976]

Originally Posted by ijustwannafly

I think cessna is going to have a real winner with the new 182 diesel but at a cost of $569k i don't know who they think they are going to sell it to.

The 182 Diesel they delayed, delayed, delayed, and then cancelled 6 months ago?

[Dbro172]

You might be better off finding a used plane, that happens to have an engine, than finding a used engine. Look at the twins for a double whammy! Yeah, Whammy, you stay classy San Diego