No damage history...? What's that REALLY mean?

It's very common to see the phrase "no damage history" in an aircraft for sale advertisement.  But what does it REALLY mean?  Assuming it's being advertised by a broker, the reality is that it's only a good faith expression of what is believed to be true.  "Damage" though has never really been defined by an end-all authority on the subject so this blog is an attempt to at least address the issue and raise the awareness of what it could mean.

My own definition of "damage" is as follows: an event that lead to an unscheduled repair to the aircraft (or engines) that materially effects the resale value of the aircraft.  After all, that's really what we all care about isn't it?  So for example; someone carries a golf bag into the back of plane and puts deep scratches into the refreshment center which leads to a repair.  Is it damage?  Yep.  Does it effect the resale value; not by much if at all.

Here are some much more obvious forms of damage history starting from the most obvious and going to the least.

1) NTSB Accident or Incident Report- It's doubtful that you'd be looking to purchase a plane that has an accident report filed on it but it's very possible that an incident report was.  (The difference between those two is very clearly defined by the NTSB.)  It's pretty easy to find out too... just Google the tail number and you'll likely find it.  If you REALLY want to dig, here is the link: http://www.ntsb.gov/aviationquery/index.aspx  So, does this effect the resale value?  YES!

2) FAA Form 337 (Major Repair or Alteration)- Typically this is where you most readily find out if an aircraft has been damaged.  The nice part is that 337's go into both the logbooks and get filed with the FAA so if you're considering buying a plane with missing logbooks, you can still get an Escrow Agent to do the search with FAA.  Keep in mind though that 337's are referred to as "field approvals" and they are used to accomplished lots of modification as well.  Actually, anything that is a "Major Alteration or Repair" that is NOT done by a Factory Service Center.  So, does it effect the resale value?  Yes, very much if it's not for modification.

3) A repair performed by a Factory Service Center for "damage"- This one is harder to find in a log review and it's even a little sneaky.  The FAA allows for the factory to do the same work that a non-factory repair facility does that would require a Form 337 be filed, only, without the 337.  The theory is that there is nobody better to fix damage than the people that built it.  That's likely a true statement and doing so often times lowers the reduction in sales price that is required from the damage event.  Case in point: There was a CJ (525) that happened to fly on the downwind side of a hailstorm and did relatively major damage to all the leading edges of the aircraft including the engine inlets.  The plane was flown to a Service Center, leading edges removed, repaired and re-installed.  Had they done a complete replacement of the leading edges, it probably would have been completely overlooked as damage because of the parts-off, parts-on nature... but since they were repaired, technically speaking it was damage.  Does it effect the resale value?  Yep, but to a much lesser extent than if the Service Center hadn't done it.  Important note: the buyer for the plane backed out of the deal once we disclosed the repairs... the feeling being, why buy this one when I can buy a near identical one without the damage for the same money.

4) Hard Landing Inspection- This one I hate.  This is an event that I feel makes the statement "no damage history" tough to get away with saying.  Ultimately it depends on the extent of the hard landing (determinable by how much was repaired as a result) but there is an important point that needs to be considered.  Would you rather see a hard landing inspection write up or would you rather NOT see a hard landing inspection write up?  In other words, what if rather than bring the plane in for the inspection, the owner decided that it would effect the value of his plane too much and not do the inspection.  That's bad too right?  Is it damage?  Not really.  Does it effect the resale value?  A little.

5) Lightning Strike Inspection- This is a lot like a hard landing inspection.  Planes get struck by lightning all the time but unless its a real obvious hit where systems fail, power goes out and radios stop working, it's probably not damage.  Here again, you look at the write up and see what the extent of the repair was.  If the nose cone had to be replaced and avionics removed and repaired... it's damage.  If the inspection were performed but no repairs needed... it's not.

6) Engine FOD (Foreign Object Debris) Damage- Less common on fuselage mounted engines, more common on wing mounted engines and really, really common on nose mounted engines.  At least in my experience.  This is mostly about the intensity of the repair though.  Was a single blade bent or did it lead to a major overhaul?  Was anything else damaged on the way in, like the inlet?  It also matters who did the work which I'll address next.  Keep in mind that on a lot of the older turbine aircraft, the only value to them is in the engines.  If the engines aren't worth much, neither is the aircraft.

7) Corrosion- This is a very, very hard subject to cover.  If an aircraft is free from corrosion, it must be made of plastic.  Every aircraft has corrosion, regardless of age and every aircraft will have corrosion repairs to it.  When it's regarding pressure vessels and wing spars... run.  If its found in an engine borescope... check with the manufacturer on the tolerances... consider running.  If it's in gear wells, that happens...

A couple of important things to point out: If you're basing your determination on how much an event (damage or not) changes the value of an aircraft solely on the logbook entry you need to consider first and foremost, who did the inspection.  If it was the manufacturer, that's very good.  If it was not the manufacturer but someone highly reputable with good brand recognition, that's good too.  If it was someone that nobody has ever heard of and probably hires contract employees, that's not good.

Its very possible for an aircraft to sustain some pretty major damage and, if repaired properly, minimally effect the resale value.  If it's related to the aircraft structure, it better have been done by the manufacturer and you really need to ask yourself whether or not this is the right plane.  Others see damage as an opportunity to get a really great deal on a plane that is almost as good as new and in some cases better!

My recommendation is simple: before you buy an aircraft, make sure you hire a competent, experienced, and reputable maintenance facility or technician to perform a thorough logbook review.  Aircraft brokers (myself included) are NOT qualified to perform these reviews.  Pilots are NOT qualified to perform these reviews either.  Only actively licensed IA's and A&P's that work for active Part 145 repair facilities with experience in that make and model are qualified.  Here is a link to the FAA's Repair Facility search database: http://av-info.faa.gov/repairstation.asp  USE IT!

And here's the disclaimer: The information contained within this blog is only intended to be used for informational purposes only and NOT for actually determining the complex definition of damage.

Wanted: Learjet 31A or Citation Bravo

Charleston, SC- Chase Aviation is pleased to report that it has been retained to purchase a Learjet 31A or Citation Bravo on behalf of a client.  As a part of the Acquisition service we conduct "off-market" aircraft research to see if there are any current aircraft owners or operators that are considering selling or would at least entertain offers.  If you have or know of an aircraft that meets the following specifications, please advise:

1994 to 2000 Learjet 31A

MSP Gold is a must
Low to average total time (5,000 or less)
12 year inspection complete
No damage, Part 91 compliant


1997 to 2000 Citation Bravo
2400-3200 TTAF
Phase 5 at least one year out
No damage, corrosion-free engines


Contact:


Brian T. Chase
bchase@chaseaviation.com
Aircraft Acquisitions and Sales
Office: 843-628-7406
Fax: 843-628-7410
Skype ID: brian.t.chase
6060 S. Aviation Ave Suite 106
North Charleston, SC 29406
Charleston Int'l Airport (CHS)

Knock, knock. Are our competitors home? And do we want to talk to them?

A cutout from an advertisement
we did during this Acquisition.

As a company that has recently shifted its focus from actively getting aircraft listings and selling them to one that acquires aircraft for clients that it represents, Chase Aviation Company, and all of us involved in the projects, have the frequent opportunity to see how our competitors represent their aircraft and that of their clients.  And the results are both frustrating and encouraging at the same time!


While I would never "name names," and I would say that near half of the aircraft we inquire on by phone, DO NOT answer when called.  We leave a voice mail and about half of those return the call within the next 24 hours.  Of those, almost all of them are informed of their "product" enough to answer the initial questions we have and to explain that while the asking price is high, their customer is open of offers.  GREAT.


Of the ones that don't return the phone call in the next 24 hours, we typically follow up with either an email inquiry or a phone inquiry, whichever we had yet to try.  Sometimes that kicks people into gear, sometimes it doesn't.  In a lot of markets, there is enough on-market inventory that we don't need to go any further with the inquiry... the theory being, if they're this hard to get a hold of on an initial inquiry, they'll be a nightmare to work with if we got into a deal.  So the owners of EASILY 25% of the on-market aircraft, are never going to know that they had an interested party that hired a professional aircraft sales company, signed an exclusive agreement doing so and either paid a retainer fee or put a deposit into Escrow, seriously interested in discussing their aircraft further.


To me, hearing that story, I'd be ready to fire my so-called "agent" as soon as I verified that it was true.  After all, what are they being hired for?!


So there are times when I look at our available aircraft for sale and think, "Gees, I wish we had more aircraft for sale. What can I do to better represent our clients thereby earning an even better reputation which will in the end, bring us more listings?"  And then there are times when I realize that the bar is set so low, all I really need to do is wake up in the morning and get to the office, manage my time and simply pick up the phone when it rings!  It is for these reasons that I no longer wonder why aircraft brokers have a bad name in this business and why it is when a good aircraft sales company prospects for a listing, the response is a Pavlovian door slammed in the face.


This is just another story that proves YOU NEED GOOD REPRESENTATION when buying an aircraft, so if you want to discuss the services we provide, please email us at acquisitions@ChaseAviation.com, watch the video below or visit our website at www.ChaseAviation.com!

Chase Aviation Welcomes its New Neighbor... Boeing!

Boeing Offices and Hangar (CHS)

Chase Aviation Company welcomes it's new neighbor at Charleston Int'l Airport, Boeing! Yes, their offices are a little bigger and a little nicer, but in real estate, you never want to have the most expensive place on the street!
The North Charleston Facility will be the final assembly point for Boeing's 787 Dreamliner that has already received over 800 firm orders including a recent order of 50 aircraft from Dubai Airlines.
The new Final Assembly building features 642,720 square feet of covered space, roughly the equivalent of 10.5 football fields. More than 18,000 tons of steel and one million cubic feet of concrete were used in its construction. At full production rate, the South Carolina Final Assembly facility will produce three 787 Dreamliners per month.  More information on the new facility can be read here.

This new facility is at the center of a contentious debate and subsequent lawsuit filed by the NLRB which claims that Boeing is opening the new plant in a right-to-work state in retaliation against members of The International Association of Machinists & Aerospace Workers (IAM) for their past strike activity in the Seattle area. The claim came despite the fact that no union jobs were being transferred from Washington state, and Boeing noted that the new jobs in South Carolina didn't even violate terms of its union contract with the IAM, let alone federal law.  The complete article on this lawsuit can be found here.

What is ChasePistons.com?

www.ChasePistons.com

Simply put, the Piston Aircraft Marketing and Advertising Division of Chase Aviation Company is just that: A place that we market and advertise piston powered aircraft- only.  So that means that our customers pay us monthly for marketing and advertising services (a breakdown of those services can be seen here) rather than pay a much bigger commission when their aircraft sells.

When it's time to sell an aircraft you have three options: a) sell it yourself b) hire a broker to do it c) pay ChasePistons.com to do it.  Option C affords all the good advantages of both options a and b without any of the downsides.  For example:

For sale by owner- You probably list the plane in one ad spot and field phone calls for about a month before you get cranky and tired of being kept on the phone for 45 mins.  Some owners actually end up changing their number!  From the kid at flight school wanting to buy his first airplane (someday) to Joe Tirekicker, you take every call.  So when you get sick of this the obvious option is to go to plan B.

Tradition Broker-  This process will start off relatively well.  Then you'll realize the broker knows little about your plane or even your type of plane.  They also required you to sign a 180 day exclusive sales agreement that probably has an autorenewal clause and locked you into a hefty ($5,000- $10,000) commission.  Some brokers are GREAT and there are some that we'd even recommend (since we don't "broker" pistons) but the majority of the good ones have gone out of business or do it part time.  If you've exhausted these two options,  until mid-2009 you had no other option...

ChasePistons.com-  There is no contract.  You pay, you stay.  You get a complete menu of quantifiable services that you can actually see in action.  We handle the initial inquiry and CC you on the response if its emailed in, or we get the callers email and then CC you on that.  We'll even follow up with them for you.  The major advantages here are that you are essentially working only with pre-qualified buyers, you have a professional aircraft sales company taking the call, and you expand your marketing coverage exponentially.  And after all, the more people that see your aircraft, the higher the chances that you'll get an acceptable offer.

All three of these options have advantages and disadvantages.  I'll readily admit that it's not an easy task to get aircraft owners to see the wisdom in paying per month when everyone else does it "for free" unless they perform.  However, the people that see the wisdom, list with us and see the results, NEVER go anywhere else.  If you want to find out what your aircraft is worth, put it on the market and find out.  If you don't want to handle this task call a broker.  When you're serious about selling NOW, call ChasePistons.com.

For complete details or to request a full detail eBrochure, please email us at sales@chasepistons.com or visit out website at www.ChasePistons.com.

The Cessna Citation 1SP

1981 Cessna Citation 1SP- N98AV

The Citation 1SP has made a name for itself in the general aviation community as the original VLJ.  Since the last was produced in 1985 it remains to be a fuel efficient, easy to fly, extremely reliable airframe capable of 1,000 nm legs and available for purchase (SN 501-0177 at ChaseAviation.com) in the $650,000 to $700,000 range.  Those who have flown the plane know it as a "good at everything, master of nothing" performer capable of 3,000ft runways, RVSM airspace, 320kts and 150gph fuel sipping stable aircraft.

For four adults and their baggage I can say with a high degree of certainty that there is no better aircraft for the money when you look at the performance numbers, acquisition costs, and what it takes to feed it.  Cessna came out with the CitationJet 525 in 1994 as a next generation 1SP and ended up making a very good aircraft with a lighter airframe and improved performance; however, you could buy two 1SP's for what you can buy a 525 for. 

So, if own a small to medium sized business and have the need the fly within 1000nm of your home office, owning a 1SP (and maybe specifically N98AV!) can allow you to reach a larger customer base faster, while maximizing you or your employees time spent doing what you do best, making money.

Stock Market Down, Aircraft Inquiries Up.

I've always felt that the stock market and the amount of activity we see company-wide were somehow loosely tied together or at least that the two trends followed one another... until recently.  Being the economic driver that it is, the United States will always lead the world in setting the starting point for what the world economy is doing but as of late, it seems that buying an aircraft may be a better investment than buying stock.  Both are volatile and uncertain but you're not able to use stock to fly around in so why not buy a plane, use it for business, reach a greater market territory and depreciate the plane out to write off on taxes.  Sure, aircraft are depreciating assets just like any other piece of equipment but stocks and other investments just don't carry the certainty they used to.

As of this morning we had three offers on eight of the aircraft we have for sale and the acquisitions side of the business has never before been busier.  This is NOT enough activity to convince me that we're seeing a turn around but we it should show is that people are starting to feel that GA aircraft values are hitting the bottom or at least cheap enough that continued market depreciation seems unlikely.  Time will tell so stay tuned!