Need advice: overhaul high time engine that is running fine before selling?

[SpeedyJoe]

Need some input from the combined wisdom of this space.

Love my 2000 Mooney Ovation 2, but after 3 years of fun mostly going up and down the West Coast, I would like to go East bound more often and for crossing the Rockies I do need a turbo more often than not.

Here is my problem: the TT on the aircraft and the engine is ~1,850h. The engine is running fine, gets oil changes every 25h, oil samples show no issues, over the last years the occasional cylinder got replaced, compressions are all north of 70 and the oil consumption is 1qt for about very 10h. Given that it runs real nice, my intention was to disregard TBO for a while and keep flying it until something bad shows up in the oil samples, the compression goes real bad or oil consumption goes up significantly, until maybe TT 2,200h.

 The airplane shows real nice, tricked out to the gills avionics wise with a few extra features that I have put in (see list below), but the high engine time could make it hard to sell. I hate overhauling the engine when it clearly doesn't need it right now, just so it "sells better". Furthermore, many owners have strong opinions whether to go new engine, re-manufactured or if overhauled is good enough (as long as it is the xyz shop that they trust, ...). 

Any thoughts on this dilemma?

Any guesses on "what the market will bear" on the airplane as is or with an engine overhaul?

Thanks

Joe

============================================================

2000 Mooney Ovation 2 featuring

• TKS (non-FIKI)
• ~300h on new 3-blade Hartzell Prop w/ TKS slingers
• G500, newest SW
• Active Traffic warning: Garmin GTS800 TCAS, top and bottom Antennas
• G530W / w Terrain, newest SW
• G430W / w Terrain, newest SW
• New PMA450 intercom w/ Marker Beacon – dimensional sound & Bluetooth connectivity
• Transponder GTX330ES – verified ADSB compliance, newest SW
• Autopilot KFC225 coupled to G500, shoots approaches (ILS and GPS WAAS based LPV approaches) down to minimums
• Garmin Flightstream 210 to send attitude to and flightplans to and from ForeFlight or other applications
• Garmin 260 Angle of Attack indicator
• JPI 830 with all sensors hooked up – master warning red LED positioned in center view of the pilot
• Stormscope WX500
• GDL69 XM Weather
• Upgraded Landing lights to 2x50W XeVision
• Upgraded Taxi lights to 2x50W XeVision, installed wig-wag function
• BatteryMinder plugs wired to the TKS refill door from both batteries
• New Alarm Clock, with yellow warning LED for timer expiration positioned in center view of the pilot
• Large built in oxygen tank, recently replaced
• Wired for powered Bose Headsets for pilot and co-pilot
• Engine heater
• 2x12V cigarette lighter plugs, 1 for front row, 1 for back row
• Wired connector to large Arctic Cooler box into the panel: double rocker switch drives fan and addtl cooling pump
• Annuals only by Mooney Service Centers – no expense spared.

[smccray]

Sell it and let the new owner do the engine.  You won't get more for it with a quality overhaul.  If you do a cheap overhaul to try and maximize profit, you're waiting on a stupid buyer that won't realize what you've done.  Very few stupid people have the resources to make a six figure purpose.

That looks like a fantastic plane for a G500TXI and EIS upgrade using the JPI830 probes.

[Mooneymite]

I like planes that have run-out/timed-out engines.  I want to put an engine that I know all about from the git-go.  However, very few sellers discount their run-out/timed-out planes enough to cover the replacement cost.

That's why the planes with over TBO engines stay on the market.

[KSMooniac]

As an experienced owner I'd rather buy yours as-is and keep flying. A newbie probably would rather have a fresh engine. I suspect it will sell faster with a quality overhaul, but you'll end up with less net money in your pocket. I'd just list it with a realistic price to account for 90% of TBO and see what happens... You can always overhaul later.

Sent from my LG-US996 using Tapatalk

[kris_adams]

Very nice plane.  I'm sure there are a lot of people that would love to own that beauty!

[Niko182]

26 minutes ago, SpeedyJoe said:

Need some input from the combined wisdom of this space.

Love my 2000 Mooney Ovation 2, but after 3 years of fun mostly going up and down the West Coast, I would like to go East bound more often and for crossing the Rockies I do need a turbo more often than not.

Here is my problem: the TT on the aircraft and the engine is ~1,850h. The engine is running fine, gets oil changes every 25h, oil samples show no issues, over the last years the occasional cylinder got replaced, compressions are all north of 70 and the oil consumption is 1qt for about very 10h. Given that it runs real nice, my intention was to disregard TBO for a while and keep flying it until something bad shows up in the oil samples, the compression goes real bad or oil consumption goes up significantly, until maybe TT 2,200h.

 The airplane shows real nice, tricked out to the gills avionics wise with a few extra features that I have put in (see list below), but the high engine time could make it hard to sell. I hate overhauling the engine when it clearly doesn't need it right now, just so it "sells better". Furthermore, many owners have strong opinions whether to go new engine, re-manufactured or if overhauled is good enough (as long as it is the xyz shop that they trust, ...). 

Any thoughts on this dilemma?

Any guesses on "what the market will bear" on the airplane as is or with an engine overhaul?

Thanks

Joe

============================================================

2000 Mooney Ovation 2 featuring

• TKS (non-FIKI)
• ~300h on new 3-blade Hartzell Prop w/ TKS slingers
• G500, newest SW
• Active Traffic warning: Garmin GTS800 TCAS, top and bottom Antennas
• G530W / w Terrain, newest SW
• G430W / w Terrain, newest SW
• New PMA450 intercom w/ Marker Beacon – dimensional sound & Bluetooth connectivity
• Transponder GTX330ES – verified ADSB compliance, newest SW
• Autopilot KFC225 coupled to G500, shoots approaches (ILS and GPS WAAS based LPV approaches) down to minimums
• Garmin Flightstream 210 to send attitude to and flightplans to and from ForeFlight or other applications
• Garmin 260 Angle of Attack indicator
• JPI 830 with all sensors hooked up – master warning red LED positioned in center view of the pilot
• Stormscope WX500
• GDL69 XM Weather
• Upgraded Landing lights to 2x50W XeVision
• Upgraded Taxi lights to 2x50W XeVision, installed wig-wag function
• BatteryMinder plugs wired to the TKS refill door from both batteries
• New Alarm Clock, with yellow warning LED for timer expiration positioned in center view of the pilot
• Large built in oxygen tank, recently replaced
• Wired for powered Bose Headsets for pilot and co-pilot
• Engine heater
• 2x12V cigarette lighter plugs, 1 for front row, 1 for back row
• Wired connector to large Arctic Cooler box into the panel: double rocker switch drives fan and addtl cooling pump
• Annuals only by Mooney Service Centers – no expense spared.

Why not just stick with the plane you have. If you want a new plane, thats completely up to you, but ovations are very powerful aircraft. When i was flying my eagle from kenosha to California I just flew around some of the higher peaks around the rockies at 12,500ft. Even at that altitude I was still getting 7 to 800ft per minute. A couple people here that have ovation and eagles regularly fly them at 15 to 17000ft. I'd take a wild guess and say that if you want a turbo, youd stick with the mooney brand so that gives you the option of M20k, M20M, M20TN, or M20V. Now that youve had the 310 horses of the ovation and the long body, for me at least going back to a mid body would be quite hard. That leaves the Bravo and Acclaim. Is it really worth it for you to sell an aircraft that you know the ins and outs of, how it runs, and its maintenance history, that can still fly at 17000ft pretty good. Personally I'd stick with the ovation, but people have there reasons, so if you want a turbo get a turbo.

[kris_adams]

What are you thinking about buying?

[gsxrpilot]

I'm in agreement with what others are saying. What would you ask for the plane if it had a fresh engine? I've never been in the market for an Ovation and so don't know how to price it myself. But I think if you worked out a fair price for an Ovation with a fresh engine and then subtracted the cost of the overhaul from that number and listed it, it would sell quickly.

I'd much rather buy your plane with a timed out engine at the right price and then get it done myself.

[Guest]

It’s like painting and replacing the carpets for the next owner.  When the time comes sell it as is.

Clarence

[kortopates]

I'd recommend selling as is, just price for hours on engine accordingly. Vref gives you the data for this on an hourly basis. Base price always assumes mid-time engine, so a run out engine would amount to a discount of half the cost of a fresh OH engine. You'll have to look at Vref (free on AOPA) or the Blue Book schedule to see what they are allocating for engine time but I'd expect it still falls a bit short of 100% of all the overhaul expenses you'd pay. Plus your panel will help motivate a lot of buyers.

Owning and flying a turbo, I totally get why you want to go that route. I can't count the number of times I would have canceled or delayed if I didn't have the turbo to climb up on top and cross the weather from above it. 

Edited April 27, 2018 by kortopates

[jaylw314]

+1  Your engine is already fully depreciated, overhauling it will cost you extra that you will not get back selling it.  The counter-argument is that it might attract the non-educated buyers, but those are buyers who might not be fully committed, and might give you other kinds of false-starts and headaches.

[gsxrpilot]

As they say, "Once you go turbo..."

[Jerry 5TJ]

12 minutes ago, gsxrpilot said:

As they say, "Once you go turbo..."

I certainly agree....

[Niko182]

4 minutes ago, Jerry 5TJ said:

I certainly agree....

In your case isnt it, "once you go turbine"?

[StevenL757]

2 hours ago, gsxrpilot said:

I'm in agreement with what others are saying. What would you ask for the plane if it had a fresh engine? I've never been in the market for an Ovation and so don't know how to price it myself. But I think if you worked out a fair price for an Ovation with a fresh engine and then subtracted the cost of the overhaul from that number and listed it, it would sell quickly.

I'd much rather buy your plane with a timed out engine at the right price and then get it done myself.

Ditto.  Agree with this and others’ remarks.  Price it accordingly with a near run-out engine, and it will certainly sell quickly.  Agree with Niko, though, that you may want to reconsider a turbo.  I have absolutely nothing against them, and have considered an Acclaim more than a couple of times, but keep coming back to the rock-solid abilities and peace-of-mind my Ovation gives me...especially after I’ve configured it exactly as I want, as you appear to have done.  You’ve got some excellent equipment in that ship, and you wrote it all up nicely.  I’m convinced it will sell quickly, should you decide to list it.  Best of luck in your decision.

Steve

[Vance Harral]

4 hours ago, Mooneymite said:

However, very few sellers discount their run-out/timed-out planes enough to cover the replacement cost.

At the risk of putting words in someone else's mouth... this seems to imply that if engine replacement cost is $50K, the seller should ask $50K less than a comparable model with a new engine, $25K less than a comparable model with a half-time engine, etc.  In other words, it values the installed engine at exactly $0.

I don't see it that way, as either a buyer or seller.  A functional engine that's already installed on an aircraft and running normally has a significant nonzero value, regardless of how many hours are on it.  It's fair to debate how much value, but it's not zero.  Arguing it's zero says you'd pay the same price for the airplane if the engine wasn't actually installed, but rather just sitting derelict beside the (unflyable) airframe.  In fact, you should pay more, because the seller has already done you the favor of removing it for overhaul!

I'll be the first to admit things are worth what people are willing to pay for them.  Maybe most buyers haven't thought through the argument above.  Or they have and they're just trying for maximum negotiating leverage in hopes of a desperate seller.  But if a buyer actually gets a seller to discount the price of a flyable airplane by the full cost of an engine replacement, I think they're getting an unusually good deal.

Edited April 27, 2018 by Vance Harral

[MIm20c]

A 20 year old 1300-1800 hour engine would be valued the same by me.  The overhaul will cost 50k by the time you add all the accessories, exhaust, mounts, etc.  As a buyer I’d think another 5-7 years would be a safe bet.

For value I think the educated buyer will think:

MSC with open pocketbook- big plus

g500 with gad43 getting rid of the 256- big plus

TKS- plus for many buyers

a good AP- plus

top prop installed - plus

mortiz engine gauges - minus

310 stc? -plus if installed

Nice looking plane, I hope you find what you’re looking for. 

[chrisk]

I'd prefer a factory re-manufactured engine installed, with 100 hours on it, all in the last year.  The problem as a buyer with an older engine is risk.  What is it going to cost to overhaul by the time all the issues are dealt with?   How long will the plane be down? The benefit is potentially "free" hours on the engine if it goes past TBO, and I get to choose who does the overhaul.    

[thinwing]

Hi Speedy..nice looking Ovation...when you get serious about selling in order to upgrade to Turbo...consider a trade...assuming you want to keep total investment about the same ,maybe there is a Bravo owner out East that doesn't need the high teen low twenties performance...You are already dealing with terrain issues right where you are  so you have a good idea of performance needed while fully loaded and dealing with downdrafts.I agree with others,the Turbo is the big thing...of course you can nurse a 300 hp ovation up to the teens...but once your there than what?I concurr with selling / trading as is .As far as pricing...pretend you are actually in the market for a late model Ovation similarly equipped just like yours.Not that many are there?

[mike_elliott]

Hi Johannes, I sent you a PM. Give me a ring!

[Bravoman]

On 4/26/2018 at 5:58 PM, kortopates said:

I'd recommend selling as is, just price for hours on engine accordingly. Vref gives you the data for this on an hourly basis. Base price always assumes mid-time engine, so a run out engine would amount to a discount of half the cost of a fresh OH engine. You'll have to look at Vref (free on AOPA) or the Blue Book schedule to see what they are allocating for engine time but I'd expect it still falls a bit short of 100% of all the overhaul expenses you'd pay. Plus your panel will help motivate a lot of buyers.

Owning and flying a turbo, I totally get why you want to go that route. I can't count the number of times I would have canceled or delayed if I didn't have the turbo to climb up on top and cross the weather from above it. 

I’m not arguing with you but I’m not understanding where you say the discount for a runout engine would be half the cost of a fresh overhaul. I believe the discount on a true runout would have to be more, perhaps not 100% of the overhaul cost if the engine still appears healthy in all respects, but certainly greater than 50%. Just my 2c.

Regards, Frank

[carusoam]

+1 sell as is...  the customer buying this plane is pretty knowledgeable, will most likely have preferences of what OH he will prefer to go with...

+1 consulting AAA to see if they have something you are interested in trading for.  AAA can shorten your time between planes or time having two planes...

Consider the down-time as well...  A factory reman can be delivered in two weeks.  Overall the logistics required for the R&R takes a month...  If getting a new prop with that... the prop takes six weeks to show up...

Engine, prop, R&R, Break-in flights, You are in for a couple of months and 60amu of costs... to raise the price of the plane 60amu...

The advantage of asking this question.... we get to see what is coming up for sale!  

 

Best regards,

-a-

[Yooper Rocketman]

13 hours ago, Bravoman said:

I’m not arguing with you but I’m not understanding where you say the discount for a runout engine would be half the cost of a fresh overhaul. I believe the discount on a true runout would have to be more, perhaps not 100% of the overhaul cost if the engine still appears healthy in all respects, but certainly greater than 50%. Just my 2c.

Regards, Frank

 

On 4/26/2018 at 4:58 PM, kortopates said:

 Base price always assumes mid-time engine, so a run out engine would amount to a discount of half the cost of a fresh OH engine.  

Frank,

Paul said base price ASSUMES "mid-time" engine so essentially taking half the cost of an OH would take ALL engine value out.  I agree that most buyers would prefer controlling the overhaul and having the engine warranty coming from THEIR purchase.  It just makes things a bit cleaner.  On the other hand, you end up with your new purchase out of service for some time during the inevitable overhaul.

I'm in the same dilemma; but quite deeper into the situation.  I have a 1600 TBO Rocket engine with 2075 hours on it (475 hours past TBO) and my new plane coming out of paint in two weeks.  The Rocket has the cleanest oil filters I've ever seen, great oil samples, good compressions and very good oil consumption.  I completed 3 trips to Florida this winter in it (1200 NM each way) with no issues (well, engine wise anyway.  We won't talk about tires).  If I were to keep it, I would clearly keep running it until something changed to make me concerned.  If the reputation of the plane at my home drome is any indication of condition, I have two different guys that want me to keep it and let them buy a half partnership in it.  Since my hangar partner/best friend/ Mooney A&P would help me replace the engine, my cost for the job would be less than someone paying a shop for everything.  Still, crunching the numbers I just don't see either scenario being very good for me.

To the O.P., I recommend NOT rebuilding.  You've got enough desirable options on your plane I really don't think the engine time will stop it from selling, especially when the alternative is a lot higher selling price with a fresh OH.

Tom