What is a 310 Navajo getting charged out at these days?
What does a navajo Captain get paid these days?
thanks
navajo costing
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Re: navajo costing
That up north or down south? and the per mile I am really after.
Regards
thanks
Regards
thanks
Re: navajo costing
Howard, If your doing your costing from Avcanada to start a business......good luck. And the rate per mile isn't also going to be dependant on North or South, but also on East/West. 45K for a 310 captain is in the wish list range, especially now, and you can expect to see that number go down even more. If your allready operating you should have a grasp on this stuff and some of your overhead (fixed costs) are going to be spread over the fleet. If you plan on running a single aircraft operation.....well, it's a lot tougher to absorb the overhead with only one revenue generating aircraft. All these costs are lowered (per mile) with increased utilization so maybe you should start there. This may be a decent place to get cost per mile numbers but they better come with locations attached to them or they are useless. And really, unless the pilot is also providing quotes for the customers, they won't really know. Not all customers get the same rates.
Re: navajo costing
I just want somewhere to start. I realize most of the pilots I speak to never know much about what the plane gets charged out at. It is a very tough business to be in, usually its more than just the pilots that are not getting rich. The owners, the pilots and the mechanics are all working for barely enough at the "light twin" charter stuff. I would not mind if a few more chimed in....
Regards
Regards
Re: navajo costing
All right - Somewhere to start
I'll assume that this is a new start up with one aircraft.
Fixed Costs will include but are not limited to.
Aircraft acquisition, not only initial cost but debt service costs, also, don't forget to include a number for "lost opportunity" costs; that is to say, how much of a return could you make on that same money if you kept it in the bank and invested it elswhere. Even if you use very conservative numbers like a bank GIC or bond return rate.
Hangerage-Straight forward
Office and associated costs - ie: office rent (if outsourced), computers, programs, stationary on an ongoing basis
Insurance - Business and Aircraft - coming down a little but sometimes a bit tough to find for new operators.
Support costs - Company vehicle, maintanence on vehicles, maintanence general (hanger/office)
Training Costs - Flying and non flying staff (You will start to understand why bonds are as popular as they are)
Start up Costs - AOC aquisition costs, manual developement and upkeep. IMPORTANT - attach a cost to the lead time associated with aquiring these. ie. You can't get an AOC finalized unless you have secured an aircraft. Either a lease deal or ownership deal.
Wages- One of the biggest numbers you will see. You will need a minimum of 3 positions named O.P's manager, C.P and P.R.M. Technically these positions can all be filled by one individual IF he is qualified and accepted. But T.C is becoming really hesitant to allow one individual to fill all three now, the amount of paper is staggering and the time commitment is large. If you run 5 aircraft or 1, the required minimum paperwork is the same.
Now take all these numbers and add them up. Some will be one time costs (ie AOC) but most of them will have an ongoing cost factor associated. This total is going to shock you (really). This number has to be recovered b4 you even start making a profit at year end. (and we haven't touched on variable costs yet)
Take your fixed cost number and divide it by your hourly rate on this machine (make a spreadsheet) You will start to see your fixed costs come down dramatically as the hours go up.....it's all about utilization.
Start figuring out variable costs. Set a reserve for engine/prop rebuilds. Fuel will be in there. Pilots wages (per mile) will be in there but don't forget about them in the fixed costs as well. Maintance, oil, commisary supplies, uniforms (if supplied), the list can go on but keep the numbers reasonable.
Add these numbers to your fixed costs and divide into the hours flown spreadsheet. THIS IS WHERE IT GETS FUN. Find out what your aircraft utilization would have to be at at competive market rates to make this work. My guess (depends on what numbers you are using) will be between the 4-500 hrs mark. Flip it around now, pick a target utilization and divide it into the fixed and variable costs total. This is your min return for hour to break even based on your market utilization forecasting. You will start to see, that based on these numbers, that a single aircraft op is extremely hard to sustain. Unless, you are qualified to hold all the positions yourself , and fly the aircraft. But then, you will never grow because you won't have the time to chase any new work. Catch22.
That's a really basic overview, but it's a place to start. In my experience people go wrong when they....
Under budget for capitalization costs....the money they need to have in the bank before they start......
Under bugdet for time and costs associated with aquiring the needed approvals from T.C......
Under budget actual maintainence costs for running older aircraft...(like navajo's).....
Under budget training costs and upkeep costs for Multi-IFR ops.......
Under budget associated costs like office, hanger, supplies and upkeep......
Over budget gross revenues in the first two years...(a solid customer base takes time).....
Forget to leave money in the budget for them to live on.......
Now Howard, don't get me wrong. This can be a succesfull business, but the keys are controlling overhead. And NOT being overoptimistic. Many a large operator started with one aircraft, but it's a long road to get to any position of comfort (if you ever do). Others on this board may or may not agree with my breakdown, but you might want to ask them, how many of them have actually done it ???
Good Luck
I'll assume that this is a new start up with one aircraft.
Fixed Costs will include but are not limited to.
Aircraft acquisition, not only initial cost but debt service costs, also, don't forget to include a number for "lost opportunity" costs; that is to say, how much of a return could you make on that same money if you kept it in the bank and invested it elswhere. Even if you use very conservative numbers like a bank GIC or bond return rate.
Hangerage-Straight forward
Office and associated costs - ie: office rent (if outsourced), computers, programs, stationary on an ongoing basis
Insurance - Business and Aircraft - coming down a little but sometimes a bit tough to find for new operators.
Support costs - Company vehicle, maintanence on vehicles, maintanence general (hanger/office)
Training Costs - Flying and non flying staff (You will start to understand why bonds are as popular as they are)
Start up Costs - AOC aquisition costs, manual developement and upkeep. IMPORTANT - attach a cost to the lead time associated with aquiring these. ie. You can't get an AOC finalized unless you have secured an aircraft. Either a lease deal or ownership deal.
Wages- One of the biggest numbers you will see. You will need a minimum of 3 positions named O.P's manager, C.P and P.R.M. Technically these positions can all be filled by one individual IF he is qualified and accepted. But T.C is becoming really hesitant to allow one individual to fill all three now, the amount of paper is staggering and the time commitment is large. If you run 5 aircraft or 1, the required minimum paperwork is the same.
Now take all these numbers and add them up. Some will be one time costs (ie AOC) but most of them will have an ongoing cost factor associated. This total is going to shock you (really). This number has to be recovered b4 you even start making a profit at year end. (and we haven't touched on variable costs yet)
Take your fixed cost number and divide it by your hourly rate on this machine (make a spreadsheet) You will start to see your fixed costs come down dramatically as the hours go up.....it's all about utilization.
Start figuring out variable costs. Set a reserve for engine/prop rebuilds. Fuel will be in there. Pilots wages (per mile) will be in there but don't forget about them in the fixed costs as well. Maintance, oil, commisary supplies, uniforms (if supplied), the list can go on but keep the numbers reasonable.
Add these numbers to your fixed costs and divide into the hours flown spreadsheet. THIS IS WHERE IT GETS FUN. Find out what your aircraft utilization would have to be at at competive market rates to make this work. My guess (depends on what numbers you are using) will be between the 4-500 hrs mark. Flip it around now, pick a target utilization and divide it into the fixed and variable costs total. This is your min return for hour to break even based on your market utilization forecasting. You will start to see, that based on these numbers, that a single aircraft op is extremely hard to sustain. Unless, you are qualified to hold all the positions yourself , and fly the aircraft. But then, you will never grow because you won't have the time to chase any new work. Catch22.
That's a really basic overview, but it's a place to start. In my experience people go wrong when they....
Under budget for capitalization costs....the money they need to have in the bank before they start......
Under bugdet for time and costs associated with aquiring the needed approvals from T.C......
Under budget actual maintainence costs for running older aircraft...(like navajo's).....
Under budget training costs and upkeep costs for Multi-IFR ops.......
Under budget associated costs like office, hanger, supplies and upkeep......
Over budget gross revenues in the first two years...(a solid customer base takes time).....
Forget to leave money in the budget for them to live on.......
Now Howard, don't get me wrong. This can be a succesfull business, but the keys are controlling overhead. And NOT being overoptimistic. Many a large operator started with one aircraft, but it's a long road to get to any position of comfort (if you ever do). Others on this board may or may not agree with my breakdown, but you might want to ask them, how many of them have actually done it ???
Good Luck
Last edited by Giveitago on Sun Jan 25, 2009 4:41 pm, edited 1 time in total.
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iflyforpie
- Top Poster
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Re: navajo costing
I have lost count of how many times I've encountered Navajos changing hands under bankruptcy conditions.
Geez did I say that....? Or just think it....?
Re: navajo costing
I get the feeling all Navajo's change hands in bankruptcy proceedings.
I get the feeling that after spending all the dough , folks will look down their noses at a companies "new" Navajo and say "I am not getting on that little thing"
Thanks
I get the feeling that after spending all the dough , folks will look down their noses at a companies "new" Navajo and say "I am not getting on that little thing"
Thanks
Re: navajo costing
Well, giveitago, have been there and done that. I take a slightly different approach to preliminary costing and budgeting. Original poster please feew welcome to PM me.
As to the 310 being not passanger friendly. The 310, in commercial use has some drawbacks. Even with a VG kit, it will not carry the load of its big brother, the 350, and big brothers usually have an extra cargo door at the back and a pilots exit door, all of which make them more user friendly. If I recall correctly, you might get a mod for the 310's but I am not sure.
Which brings me to the general terms of cost. You will see the 350's commanding a much higher price for this reason , and generally will see them with more TTAF, as the cost difference between operating the two is almost non-existant. If you are in Western Canada, a 350 can fly with two crew and an rig crew for a decent distant. Dont be fooled by the lower aquisition costs of a 310...there is a reason.
Lastly , in general terms, all the non-pressuriezed Navajos are big old pussycats to fly, but a ham fisted pilot can do tens of thousands of dollars damage to them in no time at all. Forgetting to open the cowl flaps, hard breaking, power mismangement, improper shut down procedures,forgetting to turn off the heaters or run them at proper settings on the ground. Properly flown, you can budget about 1 hour of maintainance for every air hour..and thats using them in and out of remote gravel strips. Keep in mind this is with the aid of a competent, knowledgeable and experienced on type, AME, and after you have gotten rid of all the little snaggy things that come with a new aquisition.
Great plane. flown and maintained well, they do make money.
As to the 310 being not passanger friendly. The 310, in commercial use has some drawbacks. Even with a VG kit, it will not carry the load of its big brother, the 350, and big brothers usually have an extra cargo door at the back and a pilots exit door, all of which make them more user friendly. If I recall correctly, you might get a mod for the 310's but I am not sure.
Which brings me to the general terms of cost. You will see the 350's commanding a much higher price for this reason , and generally will see them with more TTAF, as the cost difference between operating the two is almost non-existant. If you are in Western Canada, a 350 can fly with two crew and an rig crew for a decent distant. Dont be fooled by the lower aquisition costs of a 310...there is a reason.
Lastly , in general terms, all the non-pressuriezed Navajos are big old pussycats to fly, but a ham fisted pilot can do tens of thousands of dollars damage to them in no time at all. Forgetting to open the cowl flaps, hard breaking, power mismangement, improper shut down procedures,forgetting to turn off the heaters or run them at proper settings on the ground. Properly flown, you can budget about 1 hour of maintainance for every air hour..and thats using them in and out of remote gravel strips. Keep in mind this is with the aid of a competent, knowledgeable and experienced on type, AME, and after you have gotten rid of all the little snaggy things that come with a new aquisition.
Great plane. flown and maintained well, they do make money.
Accident speculation:
Those that post don’t know. Those that know don’t post
Those that post don’t know. Those that know don’t post
Re: navajo costing
I would agree to what Trey Kule is posting, especially the 1/1 maintanence per flight hour. I've found that to be a good budget number to work with but a lot of new operators will see that number and have a hard time believing it. The real kicker is not so much the time to keep it airwothy, but as Trey says, an inexpeirienced pilot can cause you a lot of money in a very short period of time.
The 310 can be fitted with a cargo door, and some of the later models came equipped with this. There are a number of 310's available now with the door on various markets. Trey has some valid points on capacity, not only on weight but a consideration is also bulking out on bags. (Even with small 3 or 4 person crews)
I'd be interested in hearing from Trey where we vary in some of the preliminary costing issues. Keeping in mind that I would expect our personal experience to slightly change our method of approach. I tend to be overly cautious as opposed to being overly optimistic when I'm costing a new venture or acquisition and even with that I always seem to find a few unforseen costs.
Give
The 310 can be fitted with a cargo door, and some of the later models came equipped with this. There are a number of 310's available now with the door on various markets. Trey has some valid points on capacity, not only on weight but a consideration is also bulking out on bags. (Even with small 3 or 4 person crews)
I'd be interested in hearing from Trey where we vary in some of the preliminary costing issues. Keeping in mind that I would expect our personal experience to slightly change our method of approach. I tend to be overly cautious as opposed to being overly optimistic when I'm costing a new venture or acquisition and even with that I always seem to find a few unforseen costs.
Give
Re: navajo costing
Giveitago.
We dont differ on the basic premise. I approach the budgeting process differently is all. I agree 100% with your statement of over optimism on revenue. For preliminary budgeting I use the actual going rates as a base guide, and then percentages, then fill in the numbers to see if the percentages work. If they dont, it is time to wait for the competitiors to find out that maybe their numbers wont work, or look at how to make some changes to operating costs and revenue streams.
I also agree with many of the failures you mention to estimate certain costs accurately. But if it was not for dreamers and optimists, there would not be many charter operators out there
We dont differ on the basic premise. I approach the budgeting process differently is all. I agree 100% with your statement of over optimism on revenue. For preliminary budgeting I use the actual going rates as a base guide, and then percentages, then fill in the numbers to see if the percentages work. If they dont, it is time to wait for the competitiors to find out that maybe their numbers wont work, or look at how to make some changes to operating costs and revenue streams.
I also agree with many of the failures you mention to estimate certain costs accurately. But if it was not for dreamers and optimists, there would not be many charter operators out there
Accident speculation:
Those that post don’t know. Those that know don’t post
Those that post don’t know. Those that know don’t post
Re: navajo costing
Hallelujah on the Dreamers comment, that's just so true. And it's applicable to me. My wife might say more than most. 
Re: navajo costing
what there is only one knowledgeable Navajo operator/pilot on this forum? hmmm
cmon fellas chime in would ya?
regards
cmon fellas chime in would ya?
regards
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captain_dc
- Rank 1
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Re: navajo costing
We're up to 4.80/sm on our straight Ho
It's true, the Chieftan makes more money and is much more useful for cargo...especialy with that cargo door. It also burns more gass..about 50lb's an hour more..wich is fine, if you flying to capacity, but if you could have gotten the load on a straight ho, your burning 50lb's an hour for nothing.
I've been flying Navajo's since I started comercialy flying. The straight Ho is much more fun, the chieftan is a bit of a bus comparatively.
I know where you can pick up a good chieftan at a fare price to...we're selling ours due to fleet diversification....
New leather interior, cargo door...etc.
DC
It's true, the Chieftan makes more money and is much more useful for cargo...especialy with that cargo door. It also burns more gass..about 50lb's an hour more..wich is fine, if you flying to capacity, but if you could have gotten the load on a straight ho, your burning 50lb's an hour for nothing.
I've been flying Navajo's since I started comercialy flying. The straight Ho is much more fun, the chieftan is a bit of a bus comparatively.
I know where you can pick up a good chieftan at a fare price to...we're selling ours due to fleet diversification....
New leather interior, cargo door...etc.
DC
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flyinthebug
- Rank (9)
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- Joined: Wed Feb 18, 2004 8:36 am
- Location: CYPA
Re: navajo costing
In 2004 we were 4.35$ per s/m on the -350
3.95$ per s/m on the -310.
Fuel was .77 at the time. Id expect that 4.80$ is more current
1st yr PA31 Capt was making 33-37K
2nd yr PA31 Capt 42K+
Hope that helps a bit.
Fly safe all.
PS.. Yes, 1st yr Capts were underpaid.
3.95$ per s/m on the -310.
Fuel was .77 at the time. Id expect that 4.80$ is more current
1st yr PA31 Capt was making 33-37K
2nd yr PA31 Capt 42K+
Hope that helps a bit.
Fly safe all.
PS.. Yes, 1st yr Capts were underpaid.
Re: navajo costing
Some good stuff up there. Couple of comments.
You do not list "opportunity cost" as a cost of operating. At the end of your calculations, you measure your expected profits against the opportunity cost of your next best investment, whatever that is. If the profit is greater than the opportunity lost by investing in the next best, then you should go ahead.
I'd say 1/1 flight to maintenance time is a bit high, at least on the Navajo I've been flying this past summer. Was on Piper Progressive and every 50 hours we normally had a labour bill for somewhere between 24 to 30 hours, except for one ass raping at Legatt's in Buttonville, in which that inspection took them over 180 hours. Nothing unusual, changed a flap cable, found snags like "dirty wheel wells", that sort of a game.
You do not list "opportunity cost" as a cost of operating. At the end of your calculations, you measure your expected profits against the opportunity cost of your next best investment, whatever that is. If the profit is greater than the opportunity lost by investing in the next best, then you should go ahead.
I'd say 1/1 flight to maintenance time is a bit high, at least on the Navajo I've been flying this past summer. Was on Piper Progressive and every 50 hours we normally had a labour bill for somewhere between 24 to 30 hours, except for one ass raping at Legatt's in Buttonville, in which that inspection took them over 180 hours. Nothing unusual, changed a flap cable, found snags like "dirty wheel wells", that sort of a game.
Re: navajo costing
Wow 180 hrs means it would have taken a single (good) mechanic 4 and a half weeks to do it?!
30 hrs mtce for every 50 hrs of use is plenty. I would be cleaning my own wheel wells, before I took it in at that rate.
Regards
30 hrs mtce for every 50 hrs of use is plenty. I would be cleaning my own wheel wells, before I took it in at that rate.
Regards
Re: navajo costing
Yes, it certainly beats Global Aircraft Maintenance in Halifax claim that it took them 172 hours to re and re an overhauled Navajo engine. The PE Air guy next door said they do the same job in 24-30 hours, with the 30 hours being if there is a lot of baffle repair work.
Beats them for the sore bum award. It wasn't my bum, but I do feel for the victims.
We didn't get them to do the wheel wells after advancing a "F... you, dirty wheel wells isn't a snag" argument.
Anyways bud, pick the wrong AMO and you give all of any profit you might be able to make.
Beats them for the sore bum award. It wasn't my bum, but I do feel for the victims.
We didn't get them to do the wheel wells after advancing a "F... you, dirty wheel wells isn't a snag" argument.
Anyways bud, pick the wrong AMO and you give all of any profit you might be able to make.
Re: navajo costing
My partners and I own a 310 Navajo. The plane has a cargo door, known ice certified and mid time engines. It also has a JPI EDM-760, Garmin 530W, King KLN 89, KFC 200, FD, HSI, ADF, and a Garmin 496 (the 496 replace a Bendix/King MFD KMD540).
The plane is used for private business and pleasure. Last year, we flew close to 375 hours. That's quite a bit for a private aircraft. The plane is always in tip top condition. If there is a squawk, no matter how minor it is, it will be fixed before the next flight. We are pretty anal that way.
Here's how much we spent last year...
Hangar = $6,600.00
Insurance = $8,400.00
GPS database = $1,000.00
XM Wx = $1,000.00
NavCan ANS Fee = $71.00
Charts = $1,500.00
Maintenance & Annual/yr = $35,000.00
Total = $53,571.00
Cost per hour = $143.47
Engine & Prop reserve = $ 80
Fuel consumption...
We cruise at 31", 2250 rpm and 38 USGPH (both engines)
@ $1.95 = $ 280.
Total cost per hour = approximately $ 500 (wet)
This does not include the installation of the Garmin 496 on the panel, refurbishment of the interior and a partial paint job (new stripes).
The plane is used for private business and pleasure. Last year, we flew close to 375 hours. That's quite a bit for a private aircraft. The plane is always in tip top condition. If there is a squawk, no matter how minor it is, it will be fixed before the next flight. We are pretty anal that way.
Here's how much we spent last year...
Hangar = $6,600.00
Insurance = $8,400.00
GPS database = $1,000.00
XM Wx = $1,000.00
NavCan ANS Fee = $71.00
Charts = $1,500.00
Maintenance & Annual/yr = $35,000.00
Total = $53,571.00
Cost per hour = $143.47
Engine & Prop reserve = $ 80
Fuel consumption...
We cruise at 31", 2250 rpm and 38 USGPH (both engines)
@ $1.95 = $ 280.
Total cost per hour = approximately $ 500 (wet)
This does not include the installation of the Garmin 496 on the panel, refurbishment of the interior and a partial paint job (new stripes).
