Hey Falcon 10 Guys

[Denizen]

I have doubts about whether you can do the required maintenance on a 35+ year old Falcon for 300K per year let alone pay other DOCs and fixed costs for 100-150 hours in a two pilot jet. If he is serious about the 450Kt min, look into an older Premier. You'll probably still be well North of the 300K operating budget, but you'll be a lot closer than you would be with an old Falcon 10.

The reality is the budget your owner is suggesting is not realistic for the parameters he's giving you. If you want to do him a service, get Conklin and Dedecker numbers and put together a realistic budget, or better yet, suggest a more suitable airplane. It sounds to me like he'd be better served with a King Air or more appropriately, an older Pilatus.

And, just FYI, there is no way a Falcon 10 ever catches a Citation X at 370 under any circumstances short of an engine failure. You're always going to be pulling the TLA's back soon after leveling at FL370 in a X, or you will quickly be blowing through the M.92 Mmo. Either you don't know the difference between a X and an XLS, or you're playing it a little loose with that story.

Excellent post. Far better than my gibberish. Even if the fictional guy in the story does take delivery this year (or has the FA-10 under contract this year and takes delivery next) and get the bound depreciation, how much tax savings are really there? On a 1M dollar falcon (happiest day in someone's life when they unload theirs) you get what? A 50% bonus depreciation this year? So you spend 1MM plus pre buy plus the 300K (which would mean a DOC of 2K/h @150 Hours) plus training and of course the OP's wage. So guy spends 1.5 to save 500k in tax and is now saddled with a rapidly depreciating jet on a calendar inspection schedule. I didn't learn much at "Silver Airways" but the numbers don't seem to add up.

 

[100-1/2]

Our country and industry are in terribly jeopardy if you walking egos are out there stroking your dicks as professionally with your principals and clients as you do here.

You fail to understand the difference between Depreciation and Devaluation. Depreciation is an accounting function of Tax liabilities while Devaluation is a function of what I bought an airplane so many years ago versus what I can sell it for today. A 2008 $8M acquisition of a 2005 Year Model Aircraft worth only $6M on the retail market today is a 25% DEVALUATION. A 2009 $1M acquisition of a 1982 Year Model Falcon 10 that retails for $850k today is a 15% DEVALUATION.

If I operated 1000 hours on the 2005 Aircraft and sold it for $2M loss at $6M, that airplane cost me an additional $2,000.00 over the Variable operating costs per hour.

If I operated 1000 hours on the 1982 Aircraft and sold it for a $150k loss at $850k, that airplane cost me an additional $150.00 over the variable operating costs per hour.

If an aircraft acquisition and fixed costs are on the balance sheet of a corporation, those costs reduce the tax liability on income the corporation reports. It is ridiculous to buy an overpriced aircraft in the several million dollar acquisition range when a $1M acquisition adequately maximizes the yield of caps for a particular level of income tax liability. Sometimes too, many expenditures will increase your tax liability.

"Bound Depreciation/Bonus Depreciation"??? Wow, you sound real smart! If I was a floosy high-school drop out bringing pancakes to your table at Denny's, so enamored by all three of your stripes on your epaulets? Bonus depreciation only has to do with buying new aircraft. All aircraft have the same depreciation schedule based on the date of acquisition/disposition. You can elect certain accelerations and deferrals based on a corporation's filing requirements and balance sheet methods used for assets. Essentially over a 5 year period 70% to 80% of depreciation on the TOTAL ACQUISITION, not just the purchase price of the asset is available for computation against tax liability. Bonus Depreciation is a sham and you are an idiot for taking that deal. You are stuck with the asset for 3 or more years despite having depleted 80% of the depreciation in the first 2 years. You pay huge taxes/penalties on top of Devaluation for 3 to 5 year old Aircraft Devaluation ( Average 30% Loss).

The operating costs as demonstrated by the friend/current owner over the last 8 years has been 2,200/hr and included all Recommended SB's and MSP Gold fully funded on Honeywell -2Cs. Conklin de Decker reports $2,600/hr operating cost. The principal/owner will assume the expenses personally for operation as indistinguishable personal/business and avoid pitfalls of tax liabilities/audits for misuse/abuse of company expenditures for personal benefit. Thus 150 hours at $2,200/hr = ~$330,000 annual operating budget.

Check your numbers from your exceptional wealth of wisdom and first-hand knowledge wise guy.

I didn't have the pleasure of seeing whether it was a X/XL as my cockpit descending through 310 that day wasn't equipped with an ARTC scope. does it bug you that your and every other 500, 550, 560, 650, and even 680 instruction from ATC begins with "Citation"? I never hear Gulfstream guys talk about how Bad-A$$ they are? I do know the X doesn't climb at .92 nor does it go coast to coast/westbound at .92 if it wants to get there with reserves? There is no shortage of egos like yours wanting 410 and above simply because you can on that 90 minute block flight. How much more gas will you burn at .90/FL450 on that flight than settling in at .80/FL390? Who is lose now?

And I do know the difference between an X/XL. It is about $10M.

100-1/2

 

[X-rated]

The operating costs as demonstrated by the friend/current owner over the last 8 years has been 2,200/hr and included all Recommended SB's and MSP Gold fully funded on Honeywell -2Cs. Conklin de Decker reports $2,600/hr operating cost. The principal/owner will assume the expenses personally for operation as indistinguishable personal/business and avoid pitfalls of tax liabilities/audits for misuse/abuse of company expenditures for personal benefit. Thus 150 hours at $2,200/hr = ~$330,000 annual operating budget.

Check your numbers from your exceptional wealth of wisdom and first-hand knowledge wise guy.

I didn't have the pleasure of seeing whether it was a X/XL as my cockpit descending through 310 that day wasn't equipped with an ARTC scope. does it bug you that your and every other 500, 550, 560, 650, and even 680 instruction from ATC begins with "Citation"? I never hear Gulfstream guys talk about how Bad-A$$ they are? I do know the X doesn't climb at .92 nor does it go coast to coast/westbound at .92 if it wants to get there with reserves? There is no shortage of egos like yours wanting 410 and above simply because you can on that 90 minute block flight. How much more gas will you burn at .90/FL450 on that flight than settling in at .80/FL390? Who is lose now?

And I do know the difference between an X/XL. It is about $10M.

100-1/2

You said your operating budget was 300K per year. Now you seem to be saying $2200 an hour for the total operating budget including at least two pilot's salaries, insurance, parking/hangar and all of the other fixed Costs??? 2200-2600 does sound about right for DIRECT operating cost, but does he plan to pay his pilots? If he pays 75K to the Capt, 50K for the FO, 40K for insurance, and another 1000 a month for parking, that would mean his DOC would need to be (300-202=98K/150hrs=) 653 dollars an hour. Is he stealing Jet A in the middle of the night? There is no way his total operating budget is 300K unless someone else is subsidizing him.

I haven't flown a X in more than 4 years, but no, it never bothered me in the slightest to say Citation. I have 3000 hours in the the X, and have made hundreds of cross country flights in it. I've never cruised it below M.86. You said the Falcon was overtaking it by 50kts at FL370. The Falcon 10 will fall off above 350, but at FL370, the X will always have enough reserve power to blow through Mmo. Typical cruise climb in the X is M.83, so even climbing, your Falcon wouldn't be anywhere near 50kts faster even if it was right at Mmo. You tried to infer, that there was some scenario where a Falcon 10 would be faster than the X. That's just not ever going to be the case, and certainly not at FL370.

 

[100-1/2]

My God Man! Seriously, your stupidity and ignorance is infuriating.
Do you even know what is a Fixed Cost? Direct Cost? Indirect Cost?
How about a Profit/Loss or Balance Sheet? Do you even know how
a corporation categorizes, depreciates or enters expenditures?

THE FIXED COSTS WILL BE COVERED BY THE CORPORATION. THIS INCLUDES THE TOTAL ACQUISITION COST.
-PURCHASE
-PREPURCHASE/PHASE INSPECTIONS
-FLIGHT CREW TRAINING
-INSURANCE
-TAXES
-HANGAR

OPERATING COSTS WILL BE COVERED BY THE PRINCIPAL/OWNER
-FUEL
-TRANSIENT FEES
-MSP
-INDIRECT OPERATING COSTS (MAINTENANCE, TR/OVERHAUL RESERVES)
-$2500 x 100 to 150 hours annually = $250k to $375k annual OPERATING BUDGET

THE CITATION OF UNKNOWN TYPE (ASSUMED X OR XL) WAS AT A LOWER ALTITUDE, SLOWER AND WANTING A CLIMB INTO THE FALCON 10 AT A HIGHER ALTITUDE AND FASTER, OVERTAKING THE CITATION - OF UNKNOWN TYPE!!! CAPISCE!?!

HERE IS A GRAPH AS YOU ARE OBVIOUSLY THE FINEST SPECIMEN TO COME OUT OF RIO LINDA IN SOME YEARS:


-----------------FA10@410>>>>>>FASTER>>>>
-----------------------------------------------CITATION@370>>>>>>SLOWER>>>>>

It really is curious that you are no longer in a C750. Ah, never mind. I really don't care. it seems logical and fitting.
100-1/2

 

[X-rated]

Dude, You're hilarious! Why are you so angry, unstable and clueless?

1. You never said anything about a separate corporation incurring the fixed costs, but it's just another reason to get something better. And, I specifically said if someone wasn't subsidizing the operation which they clearly are.

2. I'm not sure why you find it curious, but I don't fly a Citation X anymore because I fly and manage a Global XRS which we will soon be trading for a G650. I know neither compare to a Falcon 10 in your eyes, but I'll try to get by.

3. Nice graph! You really need to go back on the meds. All I'm saying is that you INCORRECTLY assumed it could have been Citation X even though it could not have been. Come up with any scenario you like. The Citation X will always be faster. I'm not saying the event didn't happen. ATC may very well have said Citation, but you tried to imply that that a X was slower than a Falcon 10 by including it by name with the XL in your BS story. We get it. Some Citations are slow. The X is most certainly not.

I honestly don't give a rip what you recommend to your principal. In all sincerity, I hope you enjoy whatever he buys. You're the one who has to fly it.

 

[Paradoxus]

Our country and industry are in terribly jeopardy if you walking egos are out there stroking your dicks as professionally with your principals and clients as you do here.

You fail to understand the difference between Depreciation and Devaluation. Depreciation is an accounting function of Tax liabilities while Devaluation is a function of what I bought an airplane so many years ago versus what I can sell it for today. A 2008 $8M acquisition of a 2005 Year Model Aircraft worth only $6M on the retail market today is a 25% DEVALUATION. A 2009 $1M acquisition of a 1982 Year Model Falcon 10 that retails for $850k today is a 15% DEVALUATION.

If I operated 1000 hours on the 2005 Aircraft and sold it for $2M loss at $6M, that airplane cost me an additional $2,000.00 over the Variable operating costs per hour.

If I operated 1000 hours on the 1982 Aircraft and sold it for a $150k loss at $850k, that airplane cost me an additional $150.00 over the variable operating costs per hour.

If an aircraft acquisition and fixed costs are on the balance sheet of a corporation, those costs reduce the tax liability on income the corporation reports. It is ridiculous to buy an overpriced aircraft in the several million dollar acquisition range when a $1M acquisition adequately maximizes the yield of caps for a particular level of income tax liability. Sometimes too, many expenditures will increase your tax liability.

"Bound Depreciation/Bonus Depreciation"??? Wow, you sound real smart! If I was a floosy high-school drop out bringing pancakes to your table at Denny's, so enamored by all three of your stripes on your epaulets? Bonus depreciation only has to do with buying new aircraft. All aircraft have the same depreciation schedule based on the date of acquisition/disposition. You can elect certain accelerations and deferrals based on a corporation's filing requirements and balance sheet methods used for assets. Essentially over a 5 year period 70% to 80% of depreciation on the TOTAL ACQUISITION, not just the purchase price of the asset is available for computation against tax liability. Bonus Depreciation is a sham and you are an idiot for taking that deal. You are stuck with the asset for 3 or more years despite having depleted 80% of the depreciation in the first 2 years. You pay huge taxes/penalties on top of Devaluation for 3 to 5 year old Aircraft Devaluation ( Average 30% Loss).

The operating costs as demonstrated by the friend/current owner over the last 8 years has been 2,200/hr and included all Recommended SB's and MSP Gold fully funded on Honeywell -2Cs. Conklin de Decker reports $2,600/hr operating cost. The principal/owner will assume the expenses personally for operation as indistinguishable personal/business and avoid pitfalls of tax liabilities/audits for misuse/abuse of company expenditures for personal benefit. Thus 150 hours at $2,200/hr = ~$330,000 annual operating budget.

Check your numbers from your exceptional wealth of wisdom and first-hand knowledge wise guy.

I didn't have the pleasure of seeing whether it was a X/XL as my cockpit descending through 310 that day wasn't equipped with an ARTC scope. does it bug you that your and every other 500, 550, 560, 650, and even 680 instruction from ATC begins with "Citation"? I never hear Gulfstream guys talk about how Bad-A$$ they are? I do know the X doesn't climb at .92 nor does it go coast to coast/westbound at .92 if it wants to get there with reserves? There is no shortage of egos like yours wanting 410 and above simply because you can on that 90 minute block flight. How much more gas will you burn at .90/FL450 on that flight than settling in at .80/FL390? Who is lose now?

And I do know the difference between an X/XL. It is about $10M.

100-1/2

One of the finest abortions of grammar and coherence produced by aviation this year.

Perhaps it is time to revisit the old, collegiate requisite for admission into the club...

 

[Shag McNasty]

I really don't care about all this fancy math, use some common sense for Christ sake. If you're in the market for a Falcon 10, Citation I, Sabre 65, Westwind, Challenger 600, G-II etc., you're a friggin moron.

 

[imacdog]

So, after 20 to 30 years of bouncing around Aviation and in and out of your mom's basement between jobs while you "regroup" an old/good friend comes to you for your stellar advise and counsel; says he wants a $1M to $1.5M Value MAX (for tax purposes - your brain is too small to understand) and an annual operating budget of $300k for 100 to 150hrs...fly 3 to 5 people faster than 450KTAS in/out fields Lears cant go; You get to put the deal together, make your own wage and run the thing for 3-5 yrs while the owner bangs out the depreciation...

...your answer is: hey dickhead, why dont you go get yourself some more money, come back to me and we'll go get a 'real' airplane???

That is why your career aptitude is limited to a parabola not unlike the surface of the Earth and firmly planted to it.

100-1/2

Champaigne tastes on beer budgets often work out very well in aviation. I say go for it; after all, parts for older cars seem pretty cheap, which goes to further support the idea of purchasing a Falcon 10.

 

[falconpilot]

I really don't care about all this fancy math, use some common sense for Christ sake. If you're in the market for a Falcon 10, Citation I, Sabre 65, Westwind, Challenger 600, G-II etc., you're a friggin moron.

What exactly are you flying? A new turd or an old one?

A falcon 10 is a great airplane and is better than 80% of the new airplanes out there. Are parts expensive? Yes.. Is maintenance expensive? Yes.. But its still better than any lear or small citation..

 

[Shag McNasty]

Ok Mr. G650, you really showed me. Why don't you quit your awesome job and go get a Falcon 10 job?