The Process of Acquiring a Turboprop Aircraft
If you’re looking to purchase a turboprop aircraft, especially as a first-timer, the acquisition process can seem a bit overwhelming. Since the process has multiple stages and requires deliberate planning, it’s important to work with professionals along your journey.
Working with a broker throughout the acquisition process is essential protection you need as a future owner and a huge assistance to navigating the long process. This guide breaks down the steps in the acquisition process to help you know what to expect.
Selecting Your Turboprop
First, you should consider your needs for your aircraft like whether it is for professional or personal use, how many passengers you’ll be transporting, how often you’ll fly it, the flight range it needs to cover if you’ll be leasing it for charters, and the amenities you want the plane to feature.
Next, you should consider your overall budget in your selection, including the initial purchase and the upkeep expenses. A new turboprop can cost anywhere from $2 to $8 million depending on the single/twin-engine configuration and amenities, while a 5-to-10-year used turboprop costs between $1 and $3.5 million. The “upkeep” expenses on a turboprop also add up depending on your staffing, insurance, storage, and maintenance needs.
From here, you can research the various turboprop makes and models to find one that aligns with your needs. It’s worth examining the strengths and weaknesses of all the models that fit your criteria with your broker. You can also refurbish and upgrade your chosen aircraft if desired.
From here, you can look at the market to see what is available from your list. You must examine the flight and maintenance records of any aircraft you’re considering purchasing.
Making the Offer, Conducting a Pre-Purchase Inspection, and Drafting a Purchase Agreement
When you’ve decided which aircraft you want to purchase, the next step is to make an offer to the seller. You’ll need to consider the nuanced legal and financial aspects of this step with your broker and lawyer. The offer will detail the final purchase price, the terms of payment, and the criteria for the pre-purchase inspection.
The documentation also needs to include warranty information, terms for refunds, and protection in the event the seller misrepresented the aircraft. Have your attorney review the documentation to ensure you are adequately protected as a buyer. During this process, you’ll schedule a pre-purchase inspection with an aircraft mechanic to identify any problems and required maintenance on the turboprop. This also allows you to negotiate a lower purchase price if you discover the turboprop needs any work before it’s airworthy.
Financing Your Turboprop
Unless you are outright buying your turboprop, you’ll need to secure a loan. The National Aircraft Finance Association runs a database of companies that specialize in aircraft finance loans if you need assistance finding one. Finance companies typically require 15 to 20 percent in down payment and offer loans with 5 to 20-year terms.
Insuring, Staffing, and Storing Your Turboprop
You must obtain an insurance policy, hire a crew if necessary, and decide where to store the turboprop before taking ownership. Even if you’re piloting the aircraft, the insurance company will set the experience and training terms necessary for you or your hired pilot to operate the vehicle. Additionally, you’ll need to find a place to store the plane. These conditions are important for the insurance company to approve your turboprop operation; if they’re not satisfied, the plane will remain grounded.
Acquiring Your Turboprop
The last step in taking ownership of the turboprop involves issuing an attorney-assisted acceptance certificate following the financing and pre-purchase inspection. Next, as the buyer, you’ll need to pay the financing company or seller before they transfer the title to you. This document will detail any adjustments to the conditions or price of the aircraft. After satisfying all of these conditions, the turboprop is finally yours!