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Please excuse me for completely revising my previous post while you were responding to it, Mike. I needed to make my point clearer.

Haller Airpark? You'll be sorry you asked. I'll start another thread!

Here is a question, if conservative estimate says that flying 150 hours/year on 30 year old 150 costs about the same as renting, then how the hell aircraft rentals make their money?

Lets say their planes fly 300 hours/year, but they are more expensive planes, sitting in more expensive hangars, and I am sure managers and owners are not doing it for fun. So what are the profit margins in aircraft rental industry? Just because they "know what are they doing"? Is there a twist that I do not understand?

Very little. Most FBOs (fixed base operators) survive on fuel sales and income from flying lessons. I bought my plane from the flight school where I trained, when they went out of business. They only offered flight training and plane rentals (no fuel sales). They had two 152s and two older 172s. Even though the each plane was used on average 300-400 hrs per year, they still could not survive.

They don't make any money renting. Insurance is alot higher than we pay. ad to that the 100 hr inspections. I think they do it to keep the CFI's there to take care of customers. I can rent a nice 150 for $65.00 per hour. if it was closer who knows if i would have ever purchased.
John

They also make it up in volume - most owners are hard-pressed to fly more than 100 hours a year (time, money, etc.). Whereas a rental plane can get 200 hours a year pretty easy.

Think about an owner who flies for two hours on a weekend. That's a little over a hundred hours a year - a lot of flying. But a rental plane my fly for 4-6 hours on a Saturday, an equal amount on Sunday, and still be available during the week.

Leasebacks are another way an FBO can make a profit. They lease an airplane from a private owner and fly (ie. rent) the heck out of it. They skim their profit off the top and the owner gets what's left, if anything (plus a worn out airplane in the end).

As an operating business, an FGO gets to deduct the costs. As a private owner, you don't. Everything they spend costs roughly 36% less than what you spend, due to the tax deductibility of expenses for businesses.

As others have pointed out, they rent planes primarily to be able to operate a flight school. They get to write off the cost of the instructor (You pay $30/hour, they pay the instructor $20/hour. After their write off, $7.40/hour profit). There are other expenses to add to the above, but those are also deductible. So they net some profit on the instructor, and some profit on the plane. Not a lot, but in volume, it can make a going business.

And no. Your next questions relate to "Can I set my plane up to be tax deductible?" Uncle Sam has seen every scheme out there, and killed them all other than Lease-Back (buy a plane from a dealer, lease it back to him/her to have on the line to rent.) You as the real owner do get to deduct the plane as a legitimate business, but the charges from the FBO to do the required maintenance always seem to equal or exceed your profit. Strange how that works. Now the FBO is making some money from the instructor, some from renting the plane, and a nice return from the maintenance.

Don't feel bad. A lot of smart people have gone through the same things you are going through and tried to figure out ways to reduce the ultimate cost of having an airplane available to fly. Every guy or gal currently in the Club or who has been in the club in the past has done the same. It all boils down to either rent a plane, or buy (with no deductions)and pay all the costs, expected and unexpected, out of their own pocket.

I am obviously a fan of flying, and also of owning if you can afford to do so without worrying about the costs/repairs.

Mike

Here are the folks I know about, and the reasons:

First, my business partner and his wife: They got through solo together. She found she didn't like flying alone, and then family and business demands became a higher priority.

My Uncle: Learned to fly and bought a 172 to fly back and forth between alternate residences, one on the soggy side, one east of the Cascades. On one east bound trip he ran into some weather in the mountains and scared himself. On landing on the east side, he never flew the plane again.

My attorney: Was on his long cross-country during his training about the time Mt. St. Helens was doing its thing. He found himself in a light ash cloud. Visibility was not a big problem, but he got worrying about what the ash was doing to the engine. Once he got back to his base, he never flew again.

A client: This guy operated a string of stove and spa stores. Some on the soggy side, some east of the Cascades. He used his airplane to make tours of his stores. On one particular occassion, he was on his way back from the east side. Once over the mountains he found himself low on fuel and above a solid deck of clouds filling the Puget Sound basin. He did manage to find a hole in the Chehalis area, and between the hole and some scary scud-running he managed to get down at Chehalis. A few days later he ferried his airplane to his base and never flew again.

There are also training stories. I didn't keep a count, but I know that quite a few students started training with my instructor and never completed their training, either with him or with anyone else. There were a variety of reasons, many having to do with the expense, the time, or the difficulty. I observed that those who thought learning to fly "would be kinda fun" had a tendency to quit early. One other aspect is that my instructor takes flying very seriously. If he didn't think someone was serious, he had no qualms telling them he did not want to be their instructor.

I do not want to make any judgements about any of these people. I have scared myself twice in the air and I must admit that it was very difficult for me to climb back into the airplane once safely on the ground. But I suffer from withdrawal if even a few days pass without flying (and sometimes my schedule and the weather conspire to keep me out of the cockpit for weeks). It isn't about courage. I am not even what I consider a particularly good pilot (though I am very safety conscious). I just HAVE to fly.

The "fire in the belly" story: A friend of mine offers his services making first-flights in kit-built aircraft. On one occassion just over two years ago he was first-flighting an "Express" (I've seen them, I am not sure who provides the kits). The builder had not properly attached one flap-actuating rod and it was not evident on pre-flight. On his first landing attempt only one flap deployed and he lost control of the aircraft. He was hauled from the wreckage very seriously injured and he was not expected to survive. But he did. His main concern during recovery was his ability to pass a medical and get back in the air. I know that just about any time I show up at the airport, he will be there, and he flies absolutely every chance he can get.

THAT is "fire in the belly".

Reg

From my viewpoint, there are two kinds of pilots!

The first group is those that fly because it's in their DNA. There must be a flying gene! Once discovered, flying is an integral part of who they are, just like eye color or gender. The flying gene cannot be removed, suppressed into dormancy, or replaced by any other gene. These pilot's will find a way to continue to fly no matter what the circumstances, the odds of success, or sometimes even their health. To fly is an overwhelming and compelling driving force in their lives. There may be formidable obstacles in their path, but these pilot's almost never fail to complete their training, one way or the other, sooner or later.

The second group is everyone else. They fly for any other reason than an overwhelming compulsion to be airborne. It is often an aquired taste, not one they were born with or particularly must enjoy. It includes those who fly for business, or because it's quicker than driving, or simply for the sense of accomplishment, or even as just another way to make a living (it beats driving a truck in bad weather on bad roads). They might even fly just because it seems "cool" to others. They don't have that burning desire to fly, and often have interests more important to their lifestyle, such as big slow boats or small fast cars. Their drop-out rate is understandably much higher.

Some are meant to fly, while some others just meant to fly!

Back to rental. I rented and had instruction from one FBO, the instructor charged $25.00 an hour. Occasionally, we would switch to a different FBO at a different airport. The airplane rented the same, but the CFI had to charge $33.00 an hour. $8.00 went to the FBO doing the renting.