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Cost to own and operate

P

PeteJE

Member
I made a quick back of the hand calc. on operating cost for the RV10. Does this sound reasonable, what are the real world number or even estimates other have found? (I have never owned before, so I may need some education here).

I am basing the numbers on a 150 hour flying per year.
(more hours would get less dollar per hr, but higher total per year for gas and engine fund)

Fuel 14g * 5 = 10500 yr = 70 hr
Maint. 1500 yr (est.) = 10 hr
Insure 3000 yr = 20 hr
Hanger 6000 yr = 40 hr
Engine Rebuld 2000 TBO = 15 hr (using 30K as a basis cost)


Totals on 150 hours per year =

Yearly total $23,250
Hourly total $155
 
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Looks about right. Think of it this way, with 172's comeing in around $100 an hour now, the RV is still super cheap.
 
Absolutely a good deal considering the airplane you get.

Notice I left out any financing costs..... won't be true in my case :rolleyes:
 
When I saw the thread I was mentally prepared for someone who wouldn't have a good guess and would be way low, but it really looks like at least from a rough perspective you have it made. Good job being realistic with it all! Your numbers are not all that far off from my own, just differently weighted slightly.

I consider the hourly costs to be about $75/hr as about a minimum
then add on any hangar/insurance/non-routine maintenance to that.

Again, good job.
Tim
 
waht about interest?

To be fair and honest, you need to include either interest payments or oppurtunity cost on the money into your calculations. Ignoring them is just lying to yourself.
 
Very true....but if you included opportunity cost nobody would want to build. ;)

Actually though, that's a great point. During the construction especially and when you are pre-planning your build, it pays to consider how the money you are spending on the kit will NOT gain interest on it if you buy your parts too early. I get builders that ask me if $X,XXX per month would be good for building an RV-10, and I have to discourage starting the kit sometimes, because if you actually start building and buying parts, and plan to stretch the build over 5-8 years just because of cost, you're really losing out. You could save the money, let it grow in interest, and then buy the kit and do the normal 2-4 year build...and put yourself less at risk while you do it.

By luck, I have no loan or interest payments to consider on my plane, so it's just the opportunity cost of the money that I could be earning interest on that I'm losing. But the "opportunity" that I took to build them is the opportunity that I wanted anyway.

Tim
 
TimO said:
Very true....but if you included opportunity cost nobody would want to build. ;)
Tim
Click to expand...


I dont know - If I figured out the opportunity cost of the hours I spend sitting on the couch right now, I should be saving a huge amount of money by spending my time building! Hmm... might be a good argument against the wife- figures don't lie (but liers can figure).
 
Just a different "account" ...

TimO said:
Very true....but if you included opportunity cost nobody would want to build. ;)

Actually though, that's a great point. During the construction especially and when you are pre-planning your build, it pays to consider how the money you are spending on the kit will NOT gain interest on it if you buy your parts too early. I get builders that ask me if $X,XXX per month would be good for building an RV-10, and I have to discourage starting the kit sometimes, because if you actually start building and buying parts, and plan to stretch the build over 5-8 years just because of cost, you're really losing out. You could save the money, let it grow in interest, and then buy the kit and do the normal 2-4 year build...and put yourself less at risk while you do it.

By luck, I have no loan or interest payments to consider on my plane, so it's just the opportunity cost of the money that I could be earning interest on that I'm losing. But the "opportunity" that I took to build them is the opportunity that I wanted anyway.

Tim
Click to expand...
Another way to look at things is that the funds were transferred to a different account with a different interest bearing structure. Over the life of the plane's usage by you, if you subtract what it would have cost to reant a "similar" plane, from the resale value of the plane at the time, if that amount is greater than what the money would have earned (minus the cost of renting) then you have gained!! :)

Call it justification or rationalization or real financial calculation ... its my story and I am sticking to it!! :)

James
 
How about working overtime vs. building? Building is NOT the cheap option...

Thou shalt never add the cost attached in any ways, shape, or form to a flying machine.
 
Time Value of Money

On the opportunity cost or time value of money, this depends on a lot of things. If you are going to have a plane anyway, then you could compare the cost invested in this plane versus another plane, and also the resale value at X years down the road. If you are financing, then that is certainly something that should be factored in. As others have mentioned, figuring out what you would be doing with that money and what it would be earning for you is the best thing to do, but I would not include the whole amount, but rather the amount that the value will decrease with each year flying 150hrs. The value will drop some from new initially, but probably not as fast as a new Cirrus or Columbia, especially if the RV-10 continues to be a popular airplane into the future.

As to the costs, the insurance may be a little on the low side depending on how much hull coverage and the hangar rent does seem a little high. Maintenance seams reasonable at what you have. Fuel depends on how you fly. Overall a good fairly safe estimate.

Compare that to a fractional ownership in a Cirrus...
 
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