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Do builders that sell profit or lose?

sleeper-319

I'm New Here
Just a curiosity here... but do builders that build and sell Vans aircraft profit or lose money on average? I get the sense that typical sales prices for used aircraft (even low time aircraft) are often not much more than the cost of kits and components, meaning owner/builders don't get compensated for their labor. But then there are some folks who build lots of experimentals. Do the people who build multiple aircraft make money on the sale?

I'm pretty new here, and I did search, so apologies if this is a well worn topic that I just missed.
 
I think most get their money back out, but not time invested. Maybe if you paid yourself $2/hr you could make a profit.
 
My opinions only:
First, remember that building an EAB if your sole intent is to sell and make money, is a violation of the FARs. But ‘intent’ is tough to prove.
Second, there are a few who do just that. (A) by the time you’re building your 4th or 5th airplane of the same type (say, RV-10), the amount of time needed goes down drastically. You’ve gotten good at it, you know all the choices to be made; (B) If you are very good, there is a market for Oshkosh award winning planes. There are buyers who will pay a large premium for perfect looks.
 
My opinions only:
First, remember that building an EAB if your sole intent is to sell and make money, is a violation of the FARs. But ‘intent’ is tough to prove.

Yeah, understood. I think "get compensated for" was a poor choice of words on my part. I really meant do they recover costs of building, and your comments make sense. Like all walks of life I suppose, reputation for excellence and credentials like a show winner will command a premium.
 
The real answer is that it depends on the market (at the time) and the model of RV, but in general, you’d have to be very lucky to make money if you want to earn anything more than a couple of bucks an hour for your time. And as Bob says, you can’t legally build with the intent to sell and make money.

There are times when the market is glutted with RV’s, in which case you might just get cost of materials out of a sale, and at other times (right now, for an RV-10 or -14) it is a seller’s market and the airplanes are going for pretty high dollar.

On the average, I tell people that they should not expect to get more than the price of the kit and accessories out of their airplane - if they do, consider it a nice surprise!

Paul
 
I have built and sold four RVs (so far). An RV-3,6,7, and 8. I lost money on the RV-3. Hard to sell a single seater almost thirty years ago as the RV-6 was the hot ticket back then and RV buyers wanted the SBS two-place.

I made money on the 6, 7, and 8 but only within the context of the amount for which they sold was greater than the cost of parts, paint, and taxes. Forget getting paid for labor. Actually, if you consider the effort required to build an RV labor, then you are doing it for the wrong reason.

Without having kept actual records, I would suspect that after considering the operational and fixed costs associated with owning an aircraft, I think it was pretty much a push situation. How many expensive hobbies have the potential to actually pay for themselves?

I believe it was Ken Scott who said that "Flying an RV was turning dollars into fun". It's nice that after the fun, the dollars just might come back.
 
Are you kidding me??? All of the joy and shear fun of building coupled with the ego boost from flying your own plane...Priceless! :D

-Marc
 
I believe it was Ken Scott who said that "Flying an RV was turning dollars into fun". It's nice that after the fun, the dollars just might come back.

I think every seller eventually feels that they loose - loose the pride of showing off their accomplishment, loose the joy of flying their great handling RV, & the prospect of settling for something more boring & mundane.
 
Just a curiosity here... but do builders that build and sell Vans aircraft profit or lose money on average? I get the sense that typical sales prices for used aircraft (even low time aircraft) are often not much more than the cost of kits and components, meaning owner/builders don't get compensated for their labor. But then there are some folks who build lots of experimentals. Do the people who build multiple aircraft make money on the sale?

I'm pretty new here, and I did search, so apologies if this is a well worn topic that I just missed.

How much money you get back on an RV build will depend on many factors including the state of the market at the time. But the 2 biggest factors in my opinion are:

1. The quality of the build. It doesn’t cost any more money to build a really well crafted RV than to build a real dog. Everyone starts off with the same kits from Vans....but the finished products vary wildly. I always tell new builders to protect their financial investment by building to the very best of their abilities and not trying to complete the project in record time. Impatience is the enemy of build quality.

2. Whether the aircraft has a C of A. If you sell an incomplete project expect to lose a bundle of money....you’ll be selling to bargain hunters and you will not get back the price of the parts. Everyone who starts an RV build thinks they’re going to finish the aircraft....but the majority who start at the empennage do not finish and lose considerable money. Sadly, the more they build the more they lose....selling a 90% completed project will produce the biggest loss.
 
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It depends on many factors. The best way to profit is to build, fly for years, then sell. Example: I finished my RV-6 in 1993, when kit prices were much lower, and flew it for over 25 years. When I sold it, I got more than twice what I had in it, plus 25 years of fun.
 
To me as a first time builder it seems like it would be very difficult to make money. Not saying I don't enjoy the process and the accomplishment but if I tried to look at it as a money making endeavor well... I'd just have to laugh at that thought. :D
 
Forget getting paid for labor. Actually, if you consider the effort required to build an RV labor, then you are doing it for the wrong reason.

To be clear, I have no intention of building for profit. It was genuinely just a curiosity. As I get more serious about wanting an RV, I've entertained the build vs buy question, and even in a hot market like this, prices don't really reflect the cost of labor. Labor of love I guess in most cases.

Anyhow, thanks all for indulging my curiosity.
 
Mr. FedEx, Mr. Van's, and Mr. Lycoming

If your a builder and your name is FedEx, Van's, or Lycoming - You'll make money...
 
be sure what you want...

As I get more serious about wanting an RV, I've entertained the build vs buy question, and even in a hot market like this, prices don't really reflect the cost of labor.

Do you want to have an RV or do you want to build an RV?

I think that is the major Question!!

If you want to build, start right away. It is a very demanding, sometimes frustrating but overall very, very rewarding hobby/project. You will learn a lot and meet new friends on your way. Finally, flying your self-built Aircraft......things money can´t buy!!

If you (just) want an RV...……….buy one.

Building an RV (especially your 1st) is not the fastest, nore the cheapest way to get one of those.
If it is not the building aspect that gets your attention...….i would consider buying.
 
I finished my RV-6 in 1993, when kit prices were much lower, and flew it for over 25 years. When I sold it, I got more than twice what I had in it, plus 25 years of fun.

Not entirely sure about that Mel... your loaf of bread was probably way cheaper in 93 than it was when you sold that RV. I guess it’s called inflation...
 
Simply put.....what price does one put on ones time? That's the burning question! I've made money on all the planes I have owned cause I've let the builder or buyer from new take the initial hit/loss -)
 
After spending 5 years 2 months and 15 days building, going through the DAR process, flying off 40 hour phase 1, obtaining my repairman cert. and 80 more hours of flying, I would never sell. Someday I'll be too old to fly but I'll still go to my hanger and sit with my baby and hanger fly with other pilots. Every now and then I'll bring her out in the sun, maybe taxi around a bit or let other RV pilots take her for a loop around the pattern. Them I'm gonna die and let my estate deal with it.

Nothing compares to taxing up to a bunch of other RV's in an aircraft you personally built. Interesting fact, the vast majority of RVer's I meet here in south Florida bought their RV.
 
Do you want to have an RV or do you want to build an RV?

It's an easy question for me right now... I don't have the spare time in my life to commit to it. Any contemplation about building is a "when I retire" sort of thing. Which means I'm like 99.5% buy, but occasionally when I'm talking to people and watching videos I think to myself, that would be a fun project. But then I also know myself, and know the limits of my attention span. So...
 
"When I Retire..." is a too often a misnomer.

It's an easy question for me right now... I don't have the spare time in my life to commit to it. Any contemplation about building is a "when I retire" sort of thing. Which means I'm like 99.5% buy, but occasionally when I'm talking to people and watching videos I think to myself, that would be a fun project. But then I also know myself, and know the limits of my attention span. So...

There are 2 kinds of people who retire. The ones who work more than they did when they had a job, and the ones who sit on the couch until expiration.

The best scenario is finding a job or hobby that you really enjoy. I get paid to look at airplanes! Can you beat that?
 
2. Whether the aircraft has a C of A. If you sell an incomplete project expect to lose a bundle of money....you’ll be selling to bargain hunters and you will not get back the price of the parts. Everyone who starts an RV build thinks they’re going to finish the aircraft....but the majority who start at the empennage do not finish and lose considerable money. Sadly, the more they build the more they lose....selling a 90% completed project will produce the biggest loss.

+1 on point #2 above. When I was looking to start my project, I ran the numbers and would not have been able to afford to RV if I purchased a "brand new" kit, engine, etc. I was actually looking to purchase a Sonex kit which was more in my affordability range. Then a friend turned me on to a builder selling an RV-7 project with the wings done, fuse done, new engine hung, lots of build time put into it. He had a prop and avionics in boxes, wire, tools etc. We negotiated a price that was substantially less than what he had into it, never mind the thousand hours of labor. Mel had done a EAA tech inspection on it, quality looked good, so I loaded the whole lot up in a rental truck and now have a flying RV-7. I guess I'm a bargain hunter haha.
 
But then I also know myself, and know the limits of my attention span. So...

That is actually the thing. I too am like that to some extent but there are so many different things to investigate and figure out that it makes the project the right fit for me. I never get bored with it.

I will say that when I started I really had no idea how much work it was going to be to finish the plane. I thought it would be a big project but it is much bigger than I imagined. Now that might be partially due to my "customization" of different aspects and people will tell you that is the best way to slow down the build. I tend to agree but... I still do it. I am trying to not do it as much as I did earlier though.
 
There are 2 kinds of people who retire. The ones who work more than they did when they had a job, and the ones who sit on the couch until expiration.

The best scenario is finding a job or hobby that you really enjoy. I get paid to look at airplanes! Can you beat that?

I ordered my tail kit the day after I retired. But I’m not sure I fit the first category. Had a deal with the wife that I wouldn’t be less available than when I got paid to work for a living.
 
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