Mooney Cost of ownership

[Houman]

Hi,

My partner and I are setting up a per hour fee for the engine, prop, turbo in the Rocket partnership agreement, so that when overhaul time comes, we have the money already set aside.

The way I'm calculating is TBO ( 1600h ) - ( current engine used time :160h) = 1440h left on the engine till tbo, the tbo is about $40K, with a margin of 100% for extra costs ( $80K total ) on the side for engine, prop and turbo overhaul and some unexpected repairs, that comes to about $55/h utilization.

We are paying the base annual costs separately and in case of needed repair, use the 100% margin for repairs.

Does that make sense, is it too much or not enough ?

Thanks for any advise or opinion, sorry for so many questions in the forum, my 1st plane ownership and 1st mooney, hopefully soon I can contribute instead of just ask the questions...

[Jeff_S]

It certainly sounds conservative, in that you would probably have lots of money in your repair fund if the engine makes it to TBO. You've said this is your first airplane to own, so what you'll learn is that in the first year of ownership you'll come to know all its little quirks and idiosyncrasies, and after the first annual you'll have a sense for what the standard things cost vs. the extras that always creep up.  Then you may be able to lower your hourly contribution with some comfort.

[N601RX]

Another thing to consider is how many years it will take you to get to tbo and what a engine will cost then. 

[yvesg]

I was in a partnership on the same aircraft for several years and the partners pattern changed quite a bit during that time. Sometimes we were 2, others we were 3, one guy left, then returned a few years later... I sold my share... then I bought the whole thing 2 years ago. I have been alone for two years but now looking for a partner...

The system we used did not require putting any money aside for the engine except virtually. This was nice because you would not need to have money "sleeping". The settlement between partners only happens when an event such as share changes or engine overhaul is triggered. If partner B flew more than partner A before he decides to sell his shate, the engine overhaul amount due is taken from the equity he gets when he sells his share and paid to the remaining partners.

Yves

[Houman]

Hi Yves,

 

I think the virtual aspect of it makes me a bit nervous. We all have lives outside of our airplane ( well according to my girlfriend I don't, but that's another subject lol ), anyway, I would hate to see a good partnership turn sour if some urgent repairs are needed and we need to turn the virtual into real money and it creates problems. I rather have the assurance money is there, place it in a high interest bank account or low interest fund that is accessible all time.

 

Anyway, that is my way of thinking, but again, this is my 1st plane ownership, before this, I had always rented by hour or block of hours...

 

Thanks !

[carusoam]

Did you plan for cylinder maintenance?

Some TC'd motors use a top OH at the halfway point.

Best regards,

-a-

[FloridaMan]

Before I bought my Mooney and I would use my tomtom GPS on a long drive, the ETA seems to be spot-on over a 9 hour drive. Even with fuel stops, stop lights and traffic jams, things just seemed to even out. 

 

I fly 150-200 hours a year right now and my planned/unplanned fixed maintenance costs have been between $4,000 and $5,000/yr, not counting oil changes which are variable costs of operation and not counting hangar costs. Granted, I have the Lycoming IO360. Sometimes the expense is all at once, sometimes the annual is cheap and a mag coil fails mid-year and you have a passenger that you have to put on an airline. As far as TBO is concerned, I think the best way to get past TBO is to fly it as much as you can and stay on top of preventative maintenance -- you often see flight school engines with 4000+ hours between overhauls. 

 

I bought my airplane with 1300 hours on the engine and 20 years of MSC maintenance. Part of my purchase budget for the airplane was to have enough money to afford the airplane, the most expensive repair that would not be an insurance claim and to keep it if I lost my job. If you are worried about your partner being able to step up for major maintenance when needed, you should've started with enough money in the account to cover an engine overhaul. There's no guarantee that it won't have a catastrophic failure before overhaul, nor is there one that it won't make it 2000 hours past TBO. 

[peter]

I think Antares has nailed it. You need to make sure you and your partner have the financial capacity to absorb an engine overhaul (or other big expense) at any time since those things can happen at any time.  In your partnership agreement make sure you include a buy-sell provision in case some major event happens and your partner can't pony up their share to fix it.  Now is the time to get that stuff figured out, not after it happens.

 

As far as "normal" operating costs, for our 231 we charge ourselves $25/hr to cover unscheduled minor maintenance between annual and oil changes. We charge monthly dues that cover all fixed expenses and also build up a $4k annual reserve to cover the annual inspection.  We do not collect reserves for engine, prop, turbo, etc.

 

Some years we have to write checks at annual, some years it all balances out, and in rare years we get lucky and have money left over to do upgrades/improvements.

 

Good luck with it!

 

Peter

82 M20k 231