Evaluating An Aircraft for Purchase

Maintenance records are required for several reasons. Safety is one and their effect on the value of an aircraft is another. Joe Hertzler writes about the impact that records, or lack thereof, can have on the value of an aircraft.

It seems like every day we are asked to help in evaluating the viability of an aircraft purchase. Our experience with aircraft maintenance records requirements and the fact that we really got our start doing aircraft maintenance record prepurchase evaluations has made our company a logical first choice for aircraft buyers. In the past couple Around the Hangar issues, we have discussed the maintenance record requirements along with all of the regulations that mandate those requirements. Putting that information to practical use, we will now discuss the impact that records, or lack thereof, can have on the value of an aircraft.

The single most important part of buying an aircraft is the prepurchase evaluation. Actually, an aircraft prepurchase evaluation (prebuy, tech appraisal, etc.) would really be more properly termed “aircraft value verification.” You see, by the time a prepurchase evaluation is requested, the seller has convinced the buyer that his/her aircraft is their best choice over all similar aircraft currently available for sale, and the task at hand is merely due diligence. A prepurchase evaluation really consists of two major elements: The aircraft physical inspection and the aircraft maintenance records audit.

The Aircraft Prepurchase Inspection

In order to establish/verify the physical condition of the aircraft an inspection must be performed. The selection of a maintenance provider who will perform the inspection is extremely important. Since the aircraft buyer is generally the person who pays for the prepurchase, it is important that the buyer play the lead role in selecting the maintenance provider to perform the inspection. We recommend choosing a maintenance provider with an outstanding reputation for knowledge on the make and model aircraft you are purchasing. Many maintenance providers have the certificated authority as granted by the FAA to perform inspections and maintenance on several different aircraft makes and models. However, certificated authority does not mean expertise and when making a buy decision on a multimillion dollar aircraft you must have an expert help in the evaluation.

The predominant belief is that the best maintenance provider choice will be the OEM (original equipment manufacturer), but there are several non-OEM maintenance providers who are very capable as well. We have found that most critical in the selection is the mechanic or team leader who will actually perform the work. That is truly where the expertise lies. Use your network to find someone known to be an expert on the aircraft make and model being purchased. Every maintenance organization has its strengths and weaknesses and you want to be certain that the maintenance provider you choose really knows the aircraft and can look for the problems common to the aircraft.

As for the scope and detail of the inspection, we like to keep it simple. The equivalent of a 100-hour/annual inspection must be performed as part of the prepurchase in order to uncover any possible damage or corrosion. The 100-hour/annual inspection performed on small piston aircraft is intended to be a tip-to-tail inspection that, when performed, will uncover possible airworthiness concerns. In the case of large or multi-turbine powered aircraft (Ref: 91.409 (e)), a 100-hour/ annual inspection is not readily available in the maintenance program provided by the manufacturer. However, it is not too difficult to find the equivalent of a 100-hour/annual inspection within the manufacturer’s inspection program. Generally, the manufacturer will have a group of inspections that, when combined, consist of a tip-to-tail inspection of the aircraft. Whenever an aircraft is imported into the United States the regulations require that the equivalent of a 100-hour/annual inspection be performed (Ref: Part 21.183 (d)(2)). Because of this regulation, most manufacturers have established what group of inspections is equivalent to a 100-hour/annual type inspection. Usually, the calendar term that coincides with a complete aircraft inspection is 24 months for these larger aircraft. Because each manufacturer creates inspection programs for each specific aircraft model, the actual inspections that will need to be accomplished to cover the entire aircraft vary so we can’t really say specifically what they are.

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