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What would be the market price of a newly built RV-10?

Gilbert

Member
Hello guys and thank you very much for letting me enter this nice community!
My name is Gilbert, I am 46 y.o. and I run a small business (not aviation related) in Bucharest, Romania, Eastern Europe. I have just started attending PPL classes in order to obtain my license. I have access to several good automation engineers and to one aeronautical engineer and pilot (beside being myself a technically oriented person) and I am planning to build two RV-10s, one to keep for myself and one to sell. The engineer/pilot above will also be building his RV-7 about the same time and will help me with my 10s. But the first thing I am wondering is that if building a RV-10 (in a few months of labor) in order to sell it, once completed, would make economic sense. As there are very few classifieds regarding used or newly built RV-10s, I can not figure out the price I could obtain.
Maybe I did not know where to search. Can somebody please give me a little help? Of course, it depends a lot on the aircraft’s specs, but will I have chances to sell it quick or will I just lose my time and money?
 
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I think you should build one first, then decide if you want to build the second one. Not sure on your rules where you are but in Canada and the USA , you cannot build just to sell it. This does not follow the Experimental and amature build rules here.
 
Hi Gilbert,
A few things.
1. You need to check the rules in your country. In the US if you openly state that your sole motivation in building was to sell it, the FAA will not issue an EAB airworthiness certificate (EAB = experimental amateur built). You must say you built it for your ‘education or enjoyment’.
2. Your time estimate is way off. Most builders spend years, and thousands of hours, even on so-called quick build kits. This is why it’s important that you find enjoyment in the work. There is so much, that if you don’t like it, you’ll never finish.
To answer your question: at this time, in the US, there seems to be a huge demand. Well built, well equipped, and nicely painted RV10’s are selling for over $200,000.
 
That $200k estimate is in US dollars and does not indicate what the market would be in your country. Nor could you export finished aircraft back to the US. Also, there would be little profit margin. The kits run $50k to $65k depending on standard or quickbuild. Add engine, prop, avionics, and paint and the cost could be over $150k, assuming no problems with replacement parts. So, assuming a generous $50k in profit for, say, 1000 hours work (really, it will be more), then you'd get $5 per hour. That's a really, really rough estimate. Expect to earn less, because I haven't even mentioned business costs, such as a shop, tools, insurance, and on and on.

There's a reason why similar factory aircraft have a much higher selling price.
 
Building 2 RV-10's in hopes of selling 1 and covering the cost of the 2nd one isn't going to happen, not even close.
Assuming all new components and IFR equipped, you are pushing $200k (usd) in parts expense. A VERY nice -10 might fetch $250-275k, which might cover 1/3 of the cost for RV-10 #2. People don't get rich building and selling RV's or most any other kit plane for that matter. As others have mentioned, is building/selling multiple EAB aircraft legal in Romania? Your post seems to indicate you plan on "a few months" build time. This is totally unrealistic unless you have a significant amount of assistance. My -7 was completed in 14 months which amounted to nearly a full time job.
Best of Luck!
 
Thank you very much for all your kind answers!
Now I got the point about the EAB airworthiness certificate and the rules that governs that. I think that here, in the European Union, the rules might be quite the same. I will figure it out. Why couldn’t I export it back to the US?
The major problem would be, though, that it would be impossible to obtain the certificate as a company, because I think only an individual could claim personal “education and enjoyment” purposes. Thus, the local VAT I will have to pay when importing the kit will be non-refundable at the time of export and should be added to the price of the final product, which is very bad.
A very short estimate would look like this:
- price of the kits, parts etc. shipped to EU: 180k + VAT + customs fees = 235k
- hiring 2 people (one of them being an engineer) for a year: 32k
- painting and other expenses: 30k
The total would be at least 297k, a quite important amount of money. Now, if it sells for $400k, that would be a deal. Even for 350k, would still be quite interesting. That is why I was asking about the market price of a good built, well equipped RV-10 on the US market. Seeing an add like the one in the first post with a 450k price is encouraging, but that is not necessarily the real price the market would accept. It is the lack of enough data about a newly built RV-10’s real price on the US market that made me ask for your appreciated help.
Later edit: now I have just seen your answer, Jpm757, thank you very much for your opinion and for a realistic market price.
 
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In answer to your question of “why can’t it be exported back to the United States”, the answer is that it would have to qualify for a US Airworthiness Certificate, and if it was built for profit (if that is legal in your country), it could never qualify for E-Ab certification in the US, so essentially it is “dead” in terms of selling in the US market.

Paul
 
@Ironflight: thank you for the explanation! Now I doubt that it would be legal in the EU, either. Didn't know about this limitation.
@rocketman: as I remember, Vans states 2000 hrs. Let's say 2500. That would be less than 40 weeks for 2 hired technicians, one of them being an automation engineer, plus another 3rd person, aeronautical engineer, supervising remotely each day and onsite twice a week.
 
@Ironflight: thank you for the explanation! Now I doubt that it would be legal in the EU, either. Didn't know about this limitation.
@rocketman: as I remember, Vans states 2000 hrs. Let's say 2500. That would be less than 40 weeks for 2 hired technicians, one of them being an automation engineer, plus another 3rd person, aeronautical engineer, supervising remotely each day and onsite twice a week.

...assuming that the various kit components, accessories, engines, avionics, are available to meet that timeline. I'm not following it that closely, but it seems that Van's is in quite a pickle these days relative to meeting its customers' needs in a timely fashion. Demand appears to be significantly exceeding supply. Your timeline might have to be a little more flexible than you're anticipating.
 
Thank you, MacCool! I am located on the other side of the planet and I am relying on help from you, fellows, to find out such details. So, it is very possible that I hire qualified personnel just to be waiting for the parts and the support that I need.
After all, I think I will buy just one RV-10 kit for myself, I will build it and maybe I will be offer it for sale, for a fair price. If there will be any customer, than I will surely regret, because I will surely be very attached to my first plane. If there will be no client, than I will happily keep it for myself, adding hours to it every few days.

P.S. please excuse my English, I have only learned it from movies/music/forums. Thank you!
 
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So, it is very possible that I hire qualified personnel just to be waiting for the parts and the support that I need.
!

Again, these are US rules: 51% of the work must be done by ‘amateurs’, that is, people who are not hired or paid. Since a Vans QB has a significant (45%?) amount of the work done, this means the remainder must be done by unpaid workers. Exactly how the 51% is calculated is hotly debated, but certainly here in the US you cannot register the plane as an EAB if you pay others to do most of the work.
 
In the U.S. the 51% qualification is determined by filling out the "Amateur-Built Fabrication and Assembly Checklist (2011) Fixed Wing"

This is a 10 page checklist found on the FAA website. It is involved but pretty much self explanatory.

This checklist must be used any time you make a modification that would effect the percentage of build, if your particular kit is not on the approved list, and/or anytime you have "paid assistance".

Even if the aircraft is built outside the U.S., the aircraft must meet these qualifications to be registered in the U.S. as an Experimental Amateur-Built aircraft.
 
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So, it is very possible that I hire qualified personnel just to be waiting for the parts and the support that I need.
After all, I think I will buy just one RV-10 kit for myself, I will build it and maybe I will be offer it for sale, for a fair price.


P.S. please excuse my English, I have only learned it from movies/music/forums. Thank you!

Yeah, that's possible. As to hiring the build...you'd have to check the Romanian CAA regulations regarding amateur-built airplanes and find out what The law allows. FAA regulations are likely to be irrelevant. I believe Romania operates under EASA authority. You might consider looking up the Romanian Aero Club and see if you can get guidance from them. They have a Facebook page, but I can't read it. I've never seen any Romanian movies, so your English is much better than my Romanian.
 
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Again, these are US rules: 51% of the work must be done by ‘amateurs’, that is, people who are not hired or paid. Since a Vans QB has a significant (45%?) amount of the work done, this means the remainder must be done by unpaid workers. Exactly how the 51% is calculated is hotly debated, but certainly here in the US you cannot register the plane as an EAB if you pay others to do most of the work.
Thank you very much for the explanations! Things that may be well known to you, guys, are completely unknown for somebody living the other side of the planet, so sorry for not knowing things that may seem obvious to all the community here. I don't know for sure how things work in the US, but I can tell you for sure that in the EU no aero authority will or want to check if someone has or has not paid his fellow mates for the work they have done. I wanted to do all the things completely transparent and completely open, I wanted to hire those 2 technicians completely legally, with work contracts registered on my company. If I build the kit by myself or if I hire some people, no one will know. This is not the problem here in Europe. I just wanted to make the things as professionally as I can. In fact, the plane itself is the only one that counts, and the quality and the responsibility of the build. Resuming, I certainly suppose that everywhere in Europe I could obtain the certificate, no problem. The only real problem seems to be the price. As I will be forced to import the parts/kits as an individual and not as a company, there will be VAT+taxes to be paid and not to be refunded. As I see, the price I could obtain is not worthy. Thank you!
 
Thank you very much for the explanations! Things that may be well known to you, guys, are completely unknown for somebody living the other side of the planet, so sorry for not knowing things that may seem obvious to all the community here. I don't know for sure how things work in the US, but I can tell you for sure that in the EU no aero authority will or want to check if someone has or has not paid his fellow mates for the work they have done. I wanted to do all the things completely transparent and completely open, I wanted to hire those 2 technicians completely legally, with work contracts registered on my company. If I build the kit by myself or if I hire some people, no one will know. This is not the problem here in Europe. I just wanted to make the things as professionally as I can. In fact, the plane itself is the only one that counts, and the quality and the responsibility of the build. Resuming, I certainly suppose that everywhere in Europe I could obtain the certificate, no problem. The only real problem seems to be the price. As I will be forced to import the parts/kits as an individual and not as a company, there will be VAT+taxes to be paid and not to be refunded. As I see, the price I could obtain is not worthy. Thank you!

They will know when they come to do the inspection and you can’t answer their questions because you didn’t build it. In the US, they also expect to see pictures with you doing the work.
 
@MacCool: Yes, "Romania operates under EASA authority". But there are so few experimental builds here that I should go and teach the authority about the procedures and rules, not ask them for details :).
Thank you, I will happily send you Romanian movies and songs to learn :)
 
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They will know when they come to do the inspection and you can’t answer their questions because you didn’t build it. In the US, they also expect to see pictures with you doing the work.

Does it matter? How do the regulations on kit-built airplanes work in Romania, under EASA?
 
They will know when they come to do the inspection and you can’t answer their questions because you didn’t build it. In the US, they also expect to see pictures with you doing the work.

Hmm... you are theoretically right, but in practice that would not happen in Europe, it would be quite easy to avoid. After all, I want to build an airplane using professional employees. Would it be better to build it just myself, with no engineering education, and sell it? Don't think so.
 
Hmm... you are theoretically right, but in practice that would not happen in Europe, it would be quite easy to avoid. After all, I want to build an airplane using professional employees. Would it be better to build it just myself, with no engineering education, and sell it? Don't think so.

If you don’t know the rules, I don’t know how you can avoid them. But yes, in the US, it’s “better” for someone with no engineering education to build and sell it since it’s illegal to do otherwise. Nobody said laws have to make any sense.

An engineering background isn’t necessarily the right person to build a good aircraft anyway, but that might be a language difference. I know plenty of good engineers that can’t work a screwdriver.
 
@Salty::) you are also right. I work in the meat processing industry, I use almost only custom built machinery and I do know one engineer that does not know how to screw a screw. I have studied in a psychology college, but I teach him every time how to do his work. His boss is a real professional, though.
I am sorry to say that here in Europe also the thing that matters most is the rules, and not their meaning, not the reality, not the good intentions. Sad but true, I can not use professionals to build and sell a good aircraft, but I do am allowed to build it by myself and sell it to an unfortunate buyer.
 
There are no EASA rules for homebuilt aircraft (yet?). Amateur built aircraft are governed by national rules for each individual country. You must contact the national aero club or similar organisation to find out exactly what the rules are. Most European countries insist on stage inspections as the build progresses and have similar rules to the US with regard to building for recreation and education only.
 
So, assuming a generous $50k in profit for, say, 1000 hours work (really, it will be more), then you'd get $5 per hour.

You missed a zero here, $50,000/1000 hours is $50/hour. Personally in doing the math, I would make the assumption on at least 2000 hours. In the USA, a $160k build price and $260k selling price at 2k hours build time is $50/hour, not including the costs of running a shop. Though apparently this is not realistic in EU:
A very short estimate would look like this:
- price of the kits, parts etc. shipped to EU: 180k + VAT + customs fees = 235k
- hiring 2 people (one of them being an engineer) for a year: 32k
- painting and other expenses: 30k
The total would be at least 297k, a quite important amount of money. Now, if it sells for $400k, that would be a deal. Even for 350k, would still be quite interesting. That is why I was asking about the market price of a good built, well equipped RV-10 on the US market. Seeing an add like the one in the first post with a 450k price is encouraging, but that is not necessarily the real price the market would accept.

Even without the hires (which may not be legal for resale purposes in EU) the cost to build is $265k, about the same as the selling price so I don't see any room for profit. It's true some RV-10's sell for more, but they're usually topped out on features:

Example that's on Trade-a-Plane right now:
Code:
$285,000, TT: 725, Year 2010

Avionics:
G900 Avionics Flight Deck
Dual GDU 1040 10" Displays
GDC 74A Air Data Computer
GTX 33 Transponder
TruTrak Flight System Automatic Pilot
WX 500 Storm Scope Lightning Detection System

Additional Features:
Air Conditioning

Other/Safety Features:
Wingtip Recognition Lights, Dual Alternators, Remote Ident
The A/C by itself is like $7k extra just in parts, not including install. No idea how much the laundry list of avionics will add to the price... :eek:
 
An engineering background isn’t necessarily the right person to build a good aircraft anyway, but that might be a language difference. I know plenty of good engineers that can’t work a screwdriver.

This is absolutely true. I have a mechanical engineering background and I can tell you that most schools, including mine, don't teach you a single thing about construction, assembly, or even using simple hand tools. You're assumed to just kind of know about it, but one can imagine how well that works in practice. For helping with an airplane, I'd be more confident getting assistance from a machine shop assembler than an office-based engineer even though the blue-collar assembler probably makes 1/2 the engineer's salary.
 
For guys worried about his use of the term “engineer”, be aware that the term doesn’t always translate the way you think it does. In many languages, and “engineer” is the term used for “mechanic”.....
 
Well, actually, you can. You just have to follow the same rules as Cessna and Piper.
Yap, good point! I might end up building an aircraft factory. I am just short of half a billion dollars, that's all :). Now, seriously: the automotive factories do about the same, they assembly parts that others produce, why couldn't be established a company to assembly certified airplanes using parts provided by Vans?

There are no EASA rules for homebuilt aircraft (yet?). Amateur built aircraft are governed by national rules for each individual country. You must contact the national aero club or similar organisation to find out exactly what the rules are. Most European countries insist on stage inspections as the build progresses and have similar rules to the US with regard to building for recreation and education only.
Thank you very much for that information! I will contact them and search deeper. The stage inspections seem a very good instrument for the authorities, it is good that they do that.

You missed a zero here, $50,000/1000 hours is $50/hour. Personally in doing the math, I would make the assumption on at least 2000 hours. In the USA, a $160k build price and $260k selling price at 2k hours build time is $50/hour, not including the costs of running a shop. Though apparently this is not realistic in EU.
The big problem stands in the VAT, which has to be paid and can not be refunded, being an individual, not a company. I will also search for this deeper. There is a customs fee of 10%, plus 19% VAT, and that kills the whole business. Hiring two technicians, one of them being an engineer, for a year, costs not more that 32K, taxes included.

This is absolutely true. I have a mechanical engineering background and I can tell you that most schools, including mine, don't teach you a single thing about construction, assembly, or even using simple hand tools. You're assumed to just kind of know about it, but one can imagine how well that works in practice. For helping with an airplane, I'd be more confident getting assistance from a machine shop assembler than an office-based engineer even though the blue-collar assembler probably makes 1/2 the engineer's salary.
Yes, you are right. I know guys that have been assembling all kinds of machinery their whole life, they are very good at it, even if they are not engineers.

For guys worried about his use of the term “engineer”, be aware that the term doesn’t always translate the way you think it does. In many languages, and “engineer” is the term used for “mechanic”.....
By "engineer" I mean a person who has graduated a technical type of university studies, I hope I use it correctly.
 
Hiring two technicians, one of them being an engineer, for a year, costs not more that 32K, taxes included.

That would be a horrible starting wage even for a fresh-out-of-college engineer here in the US. And it might be different in your country but the hiring company pays more per hire than just their wages. There is insurance, taxes, etc.
 
That would be a horrible starting wage even for a fresh-out-of-college engineer here in the US. And it might be different in your country but the hiring company pays more per hire than just their wages. There is insurance, taxes, etc.

I think that 32k was for the "couple months" it will take to build the plane, not a year. ;)
 
That would be a horrible starting wage even for a fresh-out-of-college engineer here in the US. And it might be different in your country but the hiring company pays more per hire than just their wages. There is insurance, taxes, etc.

I think that 32k was for the "couple months" it will take to build the plane, not a year. ;)

Let me see, I didn't search for an engineer's salary on the market here, I just approximated it. According to adds like this, like this, like this and so on (please use Google translate to understand the texts; the conversion rate is 1 dollar = 4 lei; you can simply divide the wage in "lei", local currency, by 4 and find the amount in USD),one engineer earns 1200$ / month, a technician earns $800, a total of $2000 monthly for both. Plus 60% taxes, the total is $3200. So 32k is enough for just 10 months (not a year, my mistake), that means approximately 3360 hours of work, which I suppose could be enough to build the airplane.
 
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Let me see, I didn't search for an engineer's salary on the market here, I just approximated it. According to adds like this, like this, like this and so on (please use Google translate to understand the texts; the conversion rate is 1 dollar = 4 lei; you can simply divide the wage in "lei", local cuurency, by 4 and find the amount in USD). So one engineer earns 1200$ / month, a technician earns $800, a total of $2000 monthly for both. Plus 60% taxes, the total is $3200. So 32k is enough for just 10 months (not a year, my mistake), that means approximately 3360 hours of work, which I suppose could be enough to build the airplane.

$1200 a month is achievable by mopping a McDonald's in the US.
 
Too bad for the American economy, that makes the American products' prices less competitive. Surely the immigrants help to lower those prices, but these may be still high. On the other hand, too bad for the Romanian engineers, they don't earn what they deserve.
 
There is a customs fee of 10%, plus 19% VAT, and that kills the whole business.

Yeah that 29% surcharge :eek: (not to mention $1000's in shipping) will stop most of the profit margin dead in its tacks. No surprise the QB kits are built in the Philippines.

By "engineer" I mean a person who has graduated a technical type of university studies, I hope I use it correctly.

Yes, that's correct. "engineer" ↔ "inginer" and "mechanic" ↔ "mecanic" in the senses we are all using them. :)

*blush* You are correct. Even so, once you add all the overhead, that seemingly large hourly profit evaporates quickly.

In the USA I feel it's a pretty good value for your time as many people don't make $50/hour, and/or would enjoy building as much or more than their regular job, though obviously paying for stuff like hangar space eats into that significantly. Definitely in Gilbert's case it would be hard to cover the overhead of customs, taxes, and hires.
 
In deed, as an individual I could not avoid to pay that surcharge. And, as a company, I could not obtain the amateur built certificate. I didn't know that the QB kits are built in Philippines, the labor costs make the difference.
Yes, :) the two words in Romanian are exactly these.
 
A BARGAIN

Ten years ago, the quick build kits were being assembled for what amounted to $10/hour....a real bargain, with expert workmanship by qualified aircraft assemblers.

I have no idea what the math would yield now.

Regards,
 
Ten years ago, the quick build kits were being assembled for what amounted to $10/hour....a real bargain, with expert workmanship by qualified aircraft assemblers.

I'm sorry Pierre but they were NOT built with expert workmanship. The number of QB fuel tank failures attest to that. My own QB wings still had the sticker on the rib inside the fuel tank! They leaked so bad that one had to have every cell opened up and repaired. If they muffed up the tanks so bad how could the quality of the work on the other parts be any better?

Now they have to deal with corrosion from the primer (or lack thereof) on the QB parts. You might as well hire untrained kids to build the kits to QB status.

If I was building today I doubt I would want a QB anything. There is little savings when you have to go back and redo the work of the hired help.

Rant off.

-Marc
 
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The math on QB's

Ten years ago, the quick build kits were being assembled for what amounted to $10/hour....a real bargain, with expert workmanship by qualified aircraft assemblers.

I have no idea what the math would yield now.

According to here:
  • QB's are about "twenty-five weeks, eight hours a day" of work, = 1000 hours
  • With a QB "you’ll have only 800-1200 hours of work to finish your airplane". Assuming median 2000 hours build time, the math checks out so far.
  • "Van’s QuickBuild Kits will cut building time for [any model] by 35-40%." With this number it seems to assume 2500-2800 hours without using QB.
No matter how the final numbers work out, let's assume that a QB = 1000 hours of labor. Looking at prices, let's compare the difference in cost between the Standard and QB, and divide by 1000 to find the QB surcharge per hour of labor. We get:
  • RV7: $11.71
  • RV8: $11.71
  • RV9: $11.71
  • RV10: $13.78
  • RV14: $12.98
Van's says "And, they work for about eight dollars an hour!" I'd chalk that quote up to them not updating their website particularly often, but even at $12 an hour it's a great deal as most RV's "appreciate" in value by roughly $50/build-hour from kit purchase to brand-new.
 
Ten years ago, the quick build kits were being assembled for what amounted to $10/hour....a real bargain, with expert workmanship by qualified aircraft assemblers.

Boy...I'm not sure about that. Maybe 10 years ago, but from what I read these days, a quick-build wing or fuselage is a dicey deal, even if you could get one.
 
Regarding Sling, the math seems different. According to this guy, he has spent $80k for the „build assist” of his 4 seater Sling TSI. According to the company, the total build time of the airplane would be 1400 hours, and they ”sell” 500 hours of work for $25k.
 
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