The Triple R Affordable Aircraft program will deliver like-new, reliable airplanes that fit many different mission profiles at about half the capital cost of a comparable new airplane with similar avionics and engines.
But is 50% less enough to convince you to buy a rebuilt airplane vs. a new airplane? Or is there a third alternative--the bargain, barn-find airplane we scour Trade-A-Plane to locate?
It depends on your view of performance economics - the price you pay for a specific capability and the long term cost of ownership that capability requires.
A rebuilt airplane will, for example, fly the same mission profile as a new airplane and with similar dispatch reliability. We argue that it will cost half to operate if real depreciation, insurance and capital costs are included.
A barn find airplane may fly reliably or it may impact you financially or otherwise through parts and systems failure. You become a test pilot of sorts when you pay too little for an airplane and purchase from a far away seller.
Rebuilt airplanes that meet Triple R standards are hard to distinguish from new airplanes.
For comparably equipped new vs. rebuilts, if you ignore the initial capital outlay and difference in hull values - your cost per hour for fuel, engine reserves, fuel, oil and repairs should be about the same.
Why? Because the engine and avionics are the same as the new airplane (zero time at install) and so are the firewall forward accessories and components.
The rebuilt airplane will burn the same amount of fuel as the new airplane; carry as many passengers (possibly more) and will have a useful load generally greater than a new airplane.
So far, so good. Speed, range, fuel costs payload - and intangibles such as appearance - are essentially the same.
But then, reality bites: new airplanes depreciate like a new car. On an $800,000 single engine airplane, IRS and real depreciation will be 20% or more, about $160,000 in the first year alone -and possibly the same amount in year two. So the $800K airplane becomes a $640K airplane in a short time through no fault of its owner, the engine or the avionics.
A rebuilt airplane is already depreciated - and is essentially a value that matches the new airplane from a performance standpoint for years to come. What is its depreciation schedule? Obviously, it should be about half that of the new airplane. How long will a rebuilt airplane last? The short answer is simply far longer than the flying career days of most owners based on 100-300 hours a year.
So if we factor in depreciation and the cost of carrying an $800,000 capital outlay for say 200 hours yearly, the new airplane, the additional hull value on top of operating cost - the rebuilt airplane will cost about half as much to operate as the new one.