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  #1  
Old 01-07-2021, 03:08 PM
sleeper-319 sleeper-319 is offline
 
Join Date: Oct 2020
Location: Los Angeles, CA
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Default Do builders that sell profit or lose?

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.
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  #2  
Old 01-07-2021, 03:14 PM
Electrogunner Electrogunner is offline
 
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I think most get their money back out, but not time invested. Maybe if you paid yourself $2/hr you could make a profit.
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  #3  
Old 01-07-2021, 03:28 PM
BobTurner BobTurner is offline
 
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Location: Livermore, CA
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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.
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  #4  
Old 01-07-2021, 03:33 PM
sleeper-319 sleeper-319 is offline
 
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Quote:
Originally Posted by BobTurner View Post
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.
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  #5  
Old 01-07-2021, 03:45 PM
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Ironflight Ironflight is offline
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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
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  #6  
Old 01-07-2021, 03:53 PM
MLock MLock is offline
 
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Location: Salem, OR
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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.
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  #7  
Old 01-07-2021, 05:05 PM
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Plummit Plummit is offline
 
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Are you kidding me??? All of the joy and shear fun of building coupled with the ego boost from flying your own plane...Priceless!

-Marc
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  #8  
Old 01-07-2021, 05:05 PM
Ralph Inkster Ralph Inkster is offline
 
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Quote:
Originally Posted by MLock View Post

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.
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  #9  
Old 01-07-2021, 07:56 PM
sleeper-319 sleeper-319 is offline
 
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Quote:
Originally Posted by MLock View Post
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.
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  #10  
Old 01-07-2021, 08:37 PM
BobTurner BobTurner is offline
 
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Quote:
Originally Posted by sleeper-319 View Post
. Labor of love I guess in most cases.
In ALL cases. Otherwise the builder never finishes.
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