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Are new planes more expensive relative to incomes?

I found some old photos from 1979-80… this is a bit from one of them

At least one of those planes (the TB10) was brand new, according to G-INFO.

Administrator
Shoreham EGKA, United Kingdom

In the 70 there was actually a market, more planes built in a week than today in a year.

I read a statistic about the USA which showed that generally people can afford much less nowadays than they could in the past. However looking e.g. here I can see that the situation in the UK is not as bad (the chart in the USA was going up crazy showing that the average house or car now costs two or three times more as percentage of income than in the past).

My personal perception is that income has been rising much slower than prices in Europe in the recent years, i.e. Europeans can buy less than before and that is also valid for airplanes.

LSZH, LSZF, Switzerland

Vladimir wrote:

Europeans can buy less than before

Yes, 20 years ago much many more people could afford a mobile phone, a computer, etc! Such statistics are very difficult to compare. Maybe in the 1970s it was desirable to own a private plane. Today people don’t give a s*it about GA anymore, it’s shrunken to almost zero and that is not because it is so unaffordable, that is because interests have shifted.

It is starting to happen with cars as well. There were generations where the drivers license and owning a car was the ultimate goal in life. The current youth is not that enthusiastic about drivers licenses anymore, car ownership is becoming much less desirable and the first question to the dealer is not about horse power and torque, it’s about iPhone compatibility.

One needs to remember planes were cheaper as they didn’t come fitted with dual AHRS, dual ADCs, multiple EFIS displays, air con, fuel sensors that work etc. So a proportion of the increased cost is due to purchase of more. The rest I suspect is simply lack of economies of scale.

Vladimir wrote:

My personal perception is that income has been rising much slower than prices in Europe in the recent years, i.e. Europeans can buy less than before and that is also valid for airplanes.

The problem is distribution of wealth. Never since the 17 century or something has the distribution been so skewed toward the already rich people. ie. the rich get richer and the not so rich get poorer. It is described in the best seller book by this guy I don’t remember the name at the moment.

ENVA ENOP ENMO, Norway

@achimha: I don’t say you don’t buy better things. But look at it this way: In the past one could by a decent for the time house by giving out 3 annual salaries. Now you can buy a decent for today house by giving 10 annual salaries. Yes, the quality will be better but no, I cannot afford it. But the sad thing is that we are the people building those better things. So technology advances, things get better, safer, etc. but the people who engineer and produce those cannot have them any more.

So although you would fly two wings with an unreliable engine in front, you still could find the way to buy an airplane in the past. Now if you succeed, you will fly a very reliable one, with all the avionics, etc. but the average person has very little chance of buying a plane that will be allowed to fly. So the answer to the original question for me is that is is more expensive now to buy a plane relative to income.

Last Edited by Vladimir at 09 Aug 10:06
LSZH, LSZF, Switzerland

I saw somewhere a comparison between new aircraft prices for a typical fixed gear single versus typical middle class annual income in the USA. Relative to a typical middle class income, the cost of new aircraft has skyrocketed. I can’t find the article with the comparison, but:

Cost of a C172 when it came out in 1956: $8700
Cost of a C172R in 2012: $275K

Typical median income in 1956 for one person: $3600
Typical median income in 2012 for an entire household: $56000

Back in the 50s a brand new plane was a little more than 2 years of the median income. In 2012, it’s something like 6 times the median household income. New GA aircraft are vastly unaffordable unless you’re rich, and even then you’re going to get much more plane for your money if you buy a good used one. Even if we consider a good paying middle class job (say, software developer, about $80K/yr in the US – if you ever get time to fly when being expected to work 60 hours for the pay of 40, and with only 10 days of paid leave which you are discouraged from taking) a new plane is still well over 3 times annual earnings.

Last Edited by alioth at 09 Aug 10:08
Andreas IOM

Cars have become so common they are far less desirable as a status / convenince item especially as public transport has improved a lot.

Supercars are still desirable – they are still being made in the same numbers or more.

Planes are less desirable because most planes people see look like a pile of junk, there is no correlation between price and level of fit and finish as there is on high end / supercars, the crowd is not perceived as being hip – so well off people buy an Aston, a Lambo, and a ML AMG instead and there’s still money left for gas compared with say a Cirrus. With the emergence of cheap air fares and a multitude of loco’s in Europe the middle class can travel for two lifetimes for the price of a second hand spam can.

Yet the industry and its hardcore aficionados still thinks of its 1960 product as “relevant” because it can be fixed by anyone in a shed. Well pretty soon there’s going to be nothing left to fix.

alioth wrote:

Even if we consider a good paying middle class job (say, software developer, about $80K/yr in the US – if you ever get time to fly when being expected to work 60 hours for the pay of 40, and with only 10 days of paid leave which you are discouraged from taking) a new plane is still well over 3 times annual earnings.

I am a software developer and completely agree – if I work so much as to be able to pay for a plane, I have to put the money in a bank and leave it to be put in my coffin when I die because I wouldn’t have time to fly. And vice versa – if I take the time to fly, I will never have the money to buy a plane.

LSZH, LSZF, Switzerland
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