Buying Used, Buying Smart: The Prebuy
The economic downturn continues to depress used aircraft prices so if you've managed to escape significant and sustained financial peril you could be well positioned to pick up a good used aircraft at a very good price. Unfortunately, not all bargains are what they seem. The old phrase "buyer beware" is as true as it's ever been. The course most pilots take to avert the potential heartache and financial headache created by a bad aircraft purchase is the prebuy inspection. But not all inspections are equal. And if you think a recently logged annual is good enough, you may want to reconsider.
To get a handle on how to conduct a proper prebuy, we spoke with Mike Busch, who was honored as "National Aviation Maintenance Technician of the Year" in 2008. The awards program is a cooperative effort between the FAA and over a dozen industry sponsors. Aside from writing for numerous aviation publications, Busch has also produced "Savvy Owner Seminars" that are focussed on better aircraft maintenance while spending less money. And, in a previous life, Busch cofounded AVweb and served as editor-in-chief for more than seven years. We found his comments on the proper prebuy frank, sensible, and sometimes … scary.
First Things First, Language and Psychology
In speaking with Busch, one thing became clear -- the classic prebuy inspection paid for by the buyer is significantly different from an annual inspection and he generally thinks that's how it should be. That aside, when it comes to prebuys, Busch avoids the term "inspection" altogether. "Inspection has a specific regulatory meaning under the FARs. Inspections always result in a maintenance logbook entry," says Busch. This is aviation and language is important. "A prebuy," Busch says, "isn't an inspection in the regulatory sense and it shouldn't … ever … result in an entry in any maintenance record." Busch prefers the term prebuy examination.
Working outside of the regulatory framework puts a lot of factors in play. When it comes to a prebuy examination, Busch's comments suggest this puts more of an emphasis on psychological issues. "The examination should be performed by someone the owner doesn't know," says Busch. The reasons are clear, if subtle. "A mechanic who has a relationship with a seller is going to be more reluctant to say or do anything that might sour the deal for his friend, consciously or not," Busch says. "Once, in a prebuy, we found a crankcase crack that was missed by an annual performed just two months before." But there's more to it than that.
"Ideally you want to find someone who isn't familiar with the specific aircraft." Some clarification followed, "obviously, you want someone who has expert knowledge of the specific model … but you also want someone who has never seen this specific aircraft before." Busch explains that psychological factors come into play here, too. "What we're looking for is a mechanic who will approach the aircraft with an attitude of complete skepticism about its condition and airworthiness." In short, choose a mechanic who has no prior history with the seller or the aircraft … preferably nearby. The right mechanic will preferably be within a half-hour's flying time from the aircraft's home base and not more than about an hour, says Busch. This keeps things simple (or at least, less complicated) if complications arise.
In Busch's experience, a mechanic's good reputation is a good start, but it doesn't necessarily prevent problems. Busch relayed several examples of trusted shops that made simple mistakes. These things happen. One story involved a well-known service center that trusted a young mechanic with a battery installation. The mechanic managed to revers the polarity and the mistake resulted in $13,000 worth of destroyed avionics and electrical components. Another episode involved an alternator drive hub that hadn't been properly installed. Without proper torquing and a cotter pin, it came loose. As a result, the mating crankshaft face gear was so badly damaged that the engine was taken in for tear-down. There are more examples, but you get the point. The idea is here is to start with reputation, recommendations and personal experience and take care to minimize human errors by checking work where you can.
Airworthiness: The Seller's Annual Vs. Your Prebuy
Busch has seen some of the best-known shops make simple errors. It's human nature. But when considering the prebuy, there other human factors that matter just as much. "Airworthiness is a moving target," says Busch. An airplane that was airworthy last month isn't necessarily airworthy today. "That's why we have inspections every year," says Busch. But Busch takes the point farther. "Airworthiness is a somewhat amorphous standard," he says. It isn't written in stone, rather, "it's based on an inspecting IA's judgement of what conditions prevent a given aircraft from being in condition for safe operation." And those judgments vary.
To a potential buyer, this means that one IA might find an airplane airworthy while another might think it's a deathtrap, says Busch. "I run into that sort of thing every day." The disparity isn't explained by the competence or incompetence of the IA, he says, "it's just a reminder that airworthiness is an inherently subjective standard." The fact is that people have different opinions. "In my experience, when I see two opinions that differ that much, I usually find the truth is somewhere in the middle."
It's something to keep in mind when a buyer is researching an aircraft that has recently undergone an annual inspection, says Busch. The simple fact is that a buyer and his trusted mechanic may have differences with an owner and his trusted mechanic when it comes to their standards and expectations of airworthiness. For that reason, among others, Busch advises that a buyer undertake a prebuy examination, performed by a mechanic of the buyer's choosing and under the buyer's supervision, even if a recent annual has been performed.
As far as the work performed during the prebuy, Busch warns buyers to stick with the basics first, with the option to convert it to an annual if all goes well. The annual inspection, he points out, is a regulated venture that almost always runs a full course. That, and its associated costs, may not be necessary for a prebuy.
For a prebuy, the mechanic will have limited time with the aircraft so his knowledge of the model's most common and serious failure points are essential, Busch says. In the case of Cirrus prebuys, for example, Busch recommends using Cirrus Authorized Service Centers (CASC). But even when that sort of expertly targeted service is available, personalities, experience, and opinions matter. In Busch's case, even though CASC has its own prebuy checklists, Busch still prefers that CASC technicians follow his own when checking an aircraft for one of his clients.
While you may not have the mechanical expertise to consider that, it's still something to keep in mind. Whereas an annual is defined by the FARs to identify all airworthiness discrepancies, the goal of a prebuy, in Busch's opinion, is to provide the buyer information that will allow them to determine if the aircraft is worthy of their dollar and also identify any issues they might ask a seller to correct. It's also a search for what he calls "show-stoppers." These are exactly what they sound like -- big ticket repairs that derail the deal. So, when it comes to they prebuy mechanic, Busch says "the focus should remain on identifying those potential show-stoppers." And that's where buyer/mechanic interaction becomes very important.
Busch says buyers should advise their mechanic on their preferred order of examination. "Always start with the expensive stuff," he advises, "that's usually the engine … and work down from there to things like wheels and brakes." A lot of airplanes on the market have been sitting, sometimes neglected by their owners, and sometimes for months. Busch says that potential buyers who are aware of recent disuse have cause to request extra vigilance during the prebuy. "Inactivity leads to corrosion in the right environment … where humidity, salt, or smog are issues," he says. "Engines that sit can have some unhealthy bottom-end surprises." If that's the case for you, Busch has some specific recommendations.
"In the case of TCM engines," those that have been sitting, "I strongly recommend removing at least a few lifters for inspection. Typically we pull six from one side to look for pitting, flaking or spalling. If we see any, we recommend pulling all the remaining lifters and inspecting all the cam lobes." For some potential buyers that may be enough to call it quits. For others it's leverage to ask the seller to either fix the problem or reduce the asking price, accordingly.
But aside from physical matters, the prebuy should also seek to identify compliance with Airworthiness Directives and Airworthiness Limitations. A buyer should expect a seller to correct any non-compliance issues here with the seller's own money. Items that fall to the buyer to correct are issues raised by things like Service Bulletins, Busch says.
Some things should not be negotiable and if you follow Busch's advice, one of those things will cost you money. Busch feels strongly that the buyer should pay for the prebuy, in full. "I think it's a bad idea," he says. "In that case, the seller can influence how or where the prebuy is performed. It's my opinion that the buyer should retain total control of who performs the work, how extensive the examination is and when it should stop."
And if all goes well, Busch says that he generally believes that when the prebuy convinces a potential buyer to purchase the aircraft -- and the shop isn't far from the new owner's home -- the new owner should consider converting the prebuy examination into a full blown annual inspection. "Actually, in that case I often consider it a sensible thing to do," he says. After all, says Busch, a good prebuy will perform the logbook research go a decent way toward completing airframe, engine and propeller inspections. At that point, if the buyer is satisfied, says Busch, "finishing the annual inspection and addressing discrepancies on the spot can be the most cost-efficient course."
Mike Busch is online at SavvyAviator.com.