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Thanks for your responses to previous questions. I've been running
the numbers for a DA-40 and have somewhat come to the conclusion
that it's a bit expensive. Based on 300 hours for 3 years, 7%
financing, my estimates come out at, per year:
Tie down: 2,000
Payments (interest portion): 10,500
Property tax (1%): 1,700
Fuel (9 gallons per hour): 10,800
Use tax (California, 8.5%): 16,000/3=5,333
Insurance: 1,000 (probably low?)
Total: $51,000 per year
First, do these numbers seem reasonable? Second, what are good
alternatives for reducing cost (besides sharing, which may not be an
option from my airport)? Are there older planes that would be good
substitutes for the DA-40 at lower cost?
One idea I had was to look into a DA-20 C1. It has better fuel
economy, a lower purchase price, which should turn into lower
depreciation and taxes. Anybody want to take a guess at the
difference in depreciation and maintenance cost? These are the two
factors I'm not so sure about.
-- Ralph Nelson, April 20, 2009
You've discovered that owning an airplane is expensive! (Insurance will be closer to $2,000.)
That California use tax is pretty savage. One way to escape it might be to partner with someone who already owns an airplane and/or do a block time lease from a flight school.
Another tax-saving idea might be to get a 1970s Cessna Skyhawk XP (great airplane) with an engine approaching the 12-year/2000 hour TBO and older avionics. The purchase price should be very low ($30k?). Take the plane to a state that is free of sales tax on aviation parts and maintenance (e.g., Massachusetts! (or presumably Oregon, which has no sales tax)). Get the plane fixed up in the tax-free state and bring it back to California. I wouldn't think that they could keep collecting more use tax every time you had your plane worked on.
-- Philip Greenspun, April 21, 2009
I am also looking at buying a DA40. There are of course many good alternatives, but I just got my IR training on a DA40 G1000 and I am addicted to the glass cockpit. Therefore I would suggest that, if you buy a DA40, you get the G1000. Otherwise, you might as well look at the idea Philip suggested. My research shows that the $10'000 per year depreciation is too low, unless you keep the plane for a very long time. Based on current market prices, if you buy a recent plane (2005 or more) and keep it only 3 years, you could end up with 2 to 3 times this amount per year. To be perfectly frank I believe now is a bad time to buy a plane because prices have not yet really crashed. It is obvious that in a year's time many more people will need to get rid of their planes. If you can wait one year, I suggest you do it. In my case this is not an option though...
-- Antoine Edde, April 23, 2009
The last few years have not been the norm at all. Also, if you think prices have not crashed, you must not own a plane.
The planes will follow the economy for awhile. Traditionally, a 4 year old plane will appreciate at close to inflation until it becomes an antique. Interestingly, all the seventies planes are nearly antiques now.
The risk is all in Congress and FAA burning us on purpose or by incompetence.
-- Eric Warren, April 24, 2009