Advantage 15
Advantage 15
A Re-Registration
update/reminder • Page 12
                        Publisher
                    Mike Fitzgerald
    Executive Editor/Writer
                                                Market Perspective.
               Justin Lazzeri                     The bursting of the housing bubble resulted in
                                                what nearly everyone agrees is the worst recession               Change in Value in Previous and Current Recession
             Consultant/Writer                  ever. Just how bad is it? In the tables that follow                                                    Previous   Current
                 Leslie Chesley                 we compare the recent collapse to the recession
                                                which followed the dot-com bubble and 911.                     1985 King Air C90A                      -16%       -27%
                        Columnist                                                                              1985 Ce Conquest                        -25%       -18%
                      Dave Conover              Piston Singles and Twins                                       1985 King Air B200                      -28%       -32%
                     Art Director                                                                              1980 Cheyenne II                        -19%       -24%
                                                  Currently, piston singles and twins appear sta-              2000 Citation Excel                     -17%       -45%
                   Michelle Powell              ble. The small up trend in prices seen in early 2010
                                                                                                               1991 Beechjet                           -45%       -51%
                              Artist            has flattened, while buyers assimilate the higher
                                                prices and more importantly, the world situation.              2000 Gulfstream IVSP                    -30%       -53%
                        Bruce Quade
                                                The Vref Light Single Index managed a 1% climb                 2000 Hawker 800XP                       -31%       -48%
                                                in the recent quarter. Complex Singles up 1.3%.                *Previous Recession (Turbine Market) 2000-2003
                                                  2
BONUS DEPRECIATION Available for 2011 Deliveries
   President Obama has signed the Small          tax projections for 2011 and determine if                you that any tax advice contained in this
Business Jobs Act of 2010. This legislation      you can benefit from bonus depreciation in               communication, including any attachments,
brings back 50% bonus depreciation for           2011.                                                    was not intended or written to be used, and
qualified business aircraft purchases.
Property placed in service in taxable years
beginning after January 1, 2010 and before                            2011 Piper Meridian Purchase - $2,100,000
December 31, 2010 will qualify for 50%                         (Price shown for illustrative purposes only Consult your dealer for exact pricing.)
bonus depreciation.
   The general rule to qualify for bonus            Tax Year                                      2011-Bonus Depr.               2011-No Bonus Depr.
depreciation includes:                              Section 179 Expensing                         400,000                        400,000
   • Purchase and place in service a new
business aircraft in 2010                           Bonus Depreciation                            850,000                        -0-
   • Aircraft held as demonstrator by factory
or dealer will qualify as new aircraft              MACRS Depreciation                            170,000                        340,000
   • Acquiring an existing position in the          Total Depreciation Deductions                 1,420,000                      740,000
market place for an aircraft that will deliver
in 2010 can qualify for bonus depreciation.         Potential Income Tax Savings                  568,000                        296,000
   If the following requirements are met,           from depreciation (40% combined tax rates)
a 2011 delivery can also qualify for bonus
depreciation:
   • Signing a binding contract to buy a new        Aviation Tax Consultants (ATC) assists                cannot be used, for the purpose of avoiding
aircraft by December 31, 2010                    aircraft purchasers in acquiring aircraft in a           federal tax related penalties or promoting,
   • Making a non-refundable deposit of          tax efficient manner. Our services include               marketing or recommending to another
the lessor of:                                   the elimination or reduction of sales tax at             party any tax related matters addressed
		        • 10 percent of the cost, or           the time of purchase, maximizing income                  herein. •
		        • $100,000                             tax savings, controlling the cost of personal              Daniel Cheung, CPA,
   • Taking delivery and placing the             use of the aircraft, avoiding passive activity             Member
aircraft in service for Part 91 operation by     loss rules and complying with Federal
December 31, 2011                                Aviation Regulations. Cooperation with
   Below is an illustration of a 2011 Piper      client’s current tax and legal advisors is
Meridian purchase. The after-tax cash flow       welcome and encouraged.
difference is over $270,000 if you meet the         Disclosure Under IRS Circular 230: To
bonus depreciation provisions for a 2011         ensure compliance with requirements
delivery. You should review your personal        recently imposed by the IRS, we inform
                                                                                                                                                       3
                                                                                                 gage compartment within the pressure
                                                                                                 vessel. If that isn’t enough the airplane is
                                                                                                 customizable with either an additional bag-
                                                                                                 gage area across from the cabin door…or
                                                                                                 an entertainment center….or a 7th seat…
                                                                                                 or a fully enclosable lavatory! This flexibil-
                                                                                                 ity makes the Piper Altaire the only jet in
                                                It’s All About Space                             its class to offer choices to customize the
                                                                                                 cabin based on the mission. Truly a revo-
                                                   One look at the new design of the             lutionary idea and one that should be very
                                                PiperJet Altaire and it is obvious the           enticing to a lot of operators.
Piperjet Altaire                                   fuselage is significantly larger than the        Ingress and egress to the PiperJet Altaire
continued from page 1
                                                      POC. The PiperJet Altaire’s fuselage       is aided by a 3 foot wide cabin door. Not
to develop a derivative family                             is round and mounted on top of        only will this be welcomed by passengers,
of airplanes with the PiperJet and                          the wing. Mounting the fuselage      but think of the cargo carrying options that
thus the original design must allow                           on top of the wing means there     could be possible simply because “it eas-
for future variations.                                    is no spar intrusion through the       ily fit through the door”!
3. Styling – It was realized through flight     cabin as well as allowing a streamlined
testing that a cleaner, sleeker looking air-    belly fairing for aerodynamic and aesthetic      Performance and Efficiency
plane could be produced compared to the         purposes. The ability to capitalize on the
original POC.                                   maximum space for cabin occupants has le            As is the case with most aircraft, it all
   “While the earlier PiperJet design, with     d to the development of a drop down aisle        starts with the powerplant. In the PiperJet
its M-class cabin cross section, provided       floor. In the end, PiperJet Altaire custom-      Altaire’s case that powerplant is the Wil-
a comfortable environment, we wanted to         ers will benefit from a cabin that is 9 inches   liams International FJ44-3AP Turbofan with
give our jet customers an even roomier          taller and 4 inches wider than the original      de-rated 2,500 lbs of static thrust at sea
light jet that incorporates a scalable design   POC. That’s no small change! Along with          level, Full Authority Digital Engine Con-
paving the way for a future family of com-      increased space, the PiperJet Altaire is the     trol (FADEC), and a TBO of 4,000 hrs. The
petitive business jets,” said Piper CEO         recipient of a new interior styled for pas-      FJ44-3AP is derived from the type certified
Geoffrey Berger.                                senger comfort. Highlights of the new cab-       FJ44-3A engine and has an improved thrust
                                                in include:                                      to weight ratio along with durability im-
Enter the PiperJet Altaire                      • No spar intrusion                              provements derived from the large FJ44-3A
                                                • Dynamic passenger and crew seats for in-       fleet.
  Behind the scenes Piper has gathered          creased safety and comfort                          A major piece of information discovered
an impressive list of industry savvy engi-      • LED lighting for improved reliability and      during flight testing was the positive sta-
neers to revolutionize and bring to market      reduced maintenance costs                        bility of the aircraft during power changes.
the PiperJet. At this year’s NBAA in Atlanta,   • Dual-Zoned environmental control               One of Piper’s test pilots has referred to
Georgia the evolved PiperJet was unveiled       • 4 inches of additional elbow room              these pitch changes as “easily manageable
with substantial improvements over the          • Cabin height 9 inches taller                   without trimming”. That is impressive for
POC – so much so that it merited a new          • 12.5” drop down center aisle width             any airplane. However, to further reduce
name: The PiperJet Altaire. Let’s explore          Got bags?       The PiperJet Altaire is       any pitch changes on the PiperJet Altaire,
what makes this airplane so unique and          equipped with a 20 cu ft nose baggage            Williams International developed Exhaust
why it’s firmly planted for a successful fu-    compartment (large enough to fit golf            Angle Control Technology (EXACT). EXACT
ture.                                           clubs) and another 20 cu ft aft cabin bag-                          see PiperJet Altaire on page 5
4
PiperJet Altaire                                  A Fantastic Value
continued from page 4
is a passive thrust vectoring nozzle which           Slated for customer deliveries in 2014       Piper Aircraft, Inc. has a rich legacy spanning over
counteracts the thrust / pitch coupling at        the PiperJet Altaire is primed for success      72 + years of bringing to market almost 150,000
sea-level static takeoff conditions and           in both the personal and business aviation      aircraft through more than 160 models certified.
straightens the thrust vector at cruise con-      arena. The larger fuselage equates to sig-      Approximately 90,000 of those aircraft are still
ditions – all with no moving parts – it is sim-   nificantly more cabin volume and a drop-        flying and being serviced and supported on every
ply a nozzle. In addition, a slimmer, longer      down center aisle will make movement            continent by Piper’s network of authorized ser-
nacelle is coupled to a shorter and farther       throughout the refined interior effortless.     vices centers, dealers and field personnel. Piper’s
aft vertical tail on the PiperJet Altaire. The    The remarkable performance figures are          ownership – Imprimis - is committed to invest
end result is an airplane that has minimal        matched with operating costs of a single-       significant capital in Piper’s current operations to
pitch changes with power movements and            engine making it one of the most fiscally       strengthen its position in its traditional markets
looks very sleek.                                 conservative jets on the market. And the
                                                                                                  and support the development of key new prod-
   What does all this mean for performance?       flexibility offered through interior configu-
                                                                                                  ucts such as the PiperJet Altaire. “Piper’s capa-
Simple: lighter weight, uncomplicated and         ration options provides one aircraft that
powerful systems = increased performance          can support a wide variety of missions – all    bilities, its excellent dealer family and extensive
capabilities and reliability. For the Piper-      coupled with advanced technology such           customer base, coupled with Imprimis’s capabil-
Jet Altaire the numbers are impressive.           as the Garmin G3000 touch-screen flight         ity to provide financial support, our dedication to
                                                  deck.                                           growing the companies we invest in and our con-
  Max Cruise Speed             360 KTAS              Impressive programs are currently in         tacts within Asia provide fertile ground for Piper
                                                  place to assist buyers looking to advance       to expand its business in the Asian market and
  Max Range                    1,300 NM           to their own PiperJet Altaire. For new sin-     throughout the world,” said Imprimis Managing
  Range w. 800 lb Payload 1,200 NM                gle-engine turboprop Meridian buyers,           Partner Stephen W. Berger. A key step in moving
  Max Altitude                 35,000 ft          Piper offers $100,000 off the $2.5 million      forward was the appointment of Randy Groom as
                                                  dollar base purchase price of the PiperJet      Executive Vice President. Randy is an experienced
  Fuel Capacity                405 Gallons        Altaire. Buyers of new pressurized single-
                                                                                                  senior executive and prominent aviation profes-
                                                  engine piston Mirages get $50,000 off the
                                                                                                  sional with more than 36 years of leadership roles
   Coupled with these impressive perfor-          purchase price of a new Altaire, while buy-
mance numbers is the hard-to-beat effi-           ers of unpressurized single-engine piston       in General Aviation. “One of the main reasons I
ciency of a single-engine turbine. Single-        Matrixes can defer $25,000 of the initial de-   was attracted to Piper is because I love their prod-
engine turbines are not a new concept. The        posit of $75,000 on a new PiperJet Altaire.     ucts and really believe they are the right aircraft
Piper Meridian, TBM series, Cessna Cara-          Piper will escrow the initial deposit. For      for these times,” said Groom. For more informa-
van and Pilatus PC12 are all very successful      more information contact your local Piper       tion about Piper please visit www.piper.com.
airplanes and a major part of that success is     dealer. Now is a great time to join the Piper
the simplicity of operation, efficiency and       family! •
safety record that a reliable single turbine
engine provides. The PiperJet Altaire takes
single-engine turbine performance to a
new level and does so with the efficiency
of operation that will be hard to ignore.
6
provide ADS-B surveillance information
that essentially replicates existing
domestic radar coverage – resulting in
few new benefits to airspace users. Most
new capabilities and benefits, such as
enhancing airspace capacity, rely on “ADS-B
In” and the display of information in the
cockpit. However, requirements and costs
for ADS-B In may not be mature for at least
2 years. FAA has also yet to fully define
requirements for modifying its existing
automation systems that will display
ADS-B information to controllers. Problems
with integrating ADS-B on displays at the
initial operating sites indicate this will
be a significant challenge to nationwide
deployment.         Until FAA effectively
addresses these uncertainties associated
with equipage and requirements for ADS-
B’s advanced capabilities, progress with
ADS-B will be limited, and the potential
for cost increases, delays and performance    such as the Gulf of Mexico and the Alaska      We would be wise to keep a keen eye on
shortfalls will continue.”                    Capstone experiment – that it has worked       developments in this field before making
  The report goes on to offer                 wonderfully. Aircraft that never had access    any immediate changes to our aircraft, but
recommendations to the FAA for                to radar coverage and separation services      also realizing its potential and jumping on-
successful implementation and return on       were all of the sudden being provided their    board when the wrinkles are ironed out.
investment. In short, there is very little    usefulness. ADS-B can work, but there are      For now, there is no harm in sticking with
disagreement that in the test areas where     some substantial hurdles to cross before       your current traffic and weather avoidance
ADS-B has been fully implemented –            a nationwide success story can be written.     systems and seeing how the chips fall. •
                                                                                            800.394.1334 www.skytechinc.com
Corrosion and Sulphidation:
Determined Enemies of your PT-6
  The reliability of a turbine engine is         1. Two separate areas of the metal
undeniable. Specifically, the PT-6 series      surface acting as electrodes
of engines from Pratt & Whitney Canada           2. A path for the electrons to flow
has garnered worldwide acceptance as             3. The metal itself to complete the
a bullet-proof design and as such can          electrical circuit
be seen under the cowl of hundreds of
different aircraft models throughout the         This series of events creates the
years. Initially developed in 1957 when        chemical reaction that is corrosion and
P&WC set out to produce a gas turbine          leads to the consumption of metal.
engine for medium and light aircraft, the      Electrolytes are typically those from
PT-6 has spawned many different variants       the environment. One of the reasons
and is in operation in every corner of the     that metals exposed to a “salt-laden
globe. However, as tough and reliable          environment” corrode more quickly is
as the PT-6 is, there is a constant battle     that it creates an excellent electrolyte. It
brewing within the structure of every          contains chlorides, sulphides and other
turbine engine that demands our utmost         elements and compounds that chemically
attention: Corrosion and Sulphidation.         react with the metal. These materials
                                               hold moisture on the surface where they
What is the difference between                 can promote corrosion and pitting unless
Corrosion and Sulphidation?                    the metal is properly protected.
  First let’s clear up the fact that              Sulphidation is a hot-corrosion             industrial complexes, cities or volcanic
sulphidation is not the same as corrosion      phenomenon. Every turbine engine               regions, the engine’s intake system will
– although they have similar results.          uses fuel containing sulfur in sufficient      be a path for those additional catalysts
Corrosion is the deterioration of a material   amounts for sulphidation to occur. When        to reach the battle already raging within
in a reaction with the environment. All        that sulfur is burned at high temperatures     the combustion chamber of the engine.
metals will corrode over time; however         it emits sodium sulfate gas. Sulphidation      The hot section of the engine becomes
the rate and severity of corrosion varies      is accelerated by the presence of sodium       ground zero where sulphidation occurs
with the particular metal and the specific     catalysts in the environment such as           and once the attack successfully
environment that the metal is exposed to.      seawater, atmospheric pollutants and           penetrates a Compressor Turbine (CT)
Corrosion reactions are electrochemical        volcanic discharges.        If the aircraft    blade’s protective oxide coating and
in nature. For Corrosion to occur, all of      operates near any of those areas               reaches the base metal there is no way
the following must be present:                 containing the catalysts such as oceans,                            see Corrosion on page 9
8
Corrosion                                     to remove more stubborn chemicals            costs. Per P&WC’s SIL, “It is important
continued from page 8
                                              adhering to internal engine components.      to remember that the compressor wash
to reverse the process. Should the            This is more commonly referred to as a       provides the best results if performed
sulphidation be allowed to progress too       “performance recovery” wash. In addition     after the last flight of the day before salt
far, the CT blades will have to be replaced   to these methods of internal engine          deposits have had a chance to do any
– at the expense of the owner.                washing, there is also a recommended         lasting damage. Leaving the engine to sit
                                              fresh water or solvent external wash that    overnight will reduce the effectiveness
The Different Stages of                       can be effective in removing salt or other   of a wash performed at a later time.
Sulphidation                                  corrosive chemicals from the outside         Since sulphidation is dependant on
                                              casing of the engine.                        temperature, there is no advantage
  There are four progressive stages of CT                                                  to performing the turbine wash at any
blade sulphidation per Pratt & Whitney:       Wash Schedule                                particular time of the day; however,
  Stage 1 – Mild Sulphidation (coating                                                     since the compressor wash will transfer
deterioration)                                   The nature and frequency of a             salt deposits into the turbine, it is
Slight roughness of surface due to some       compressor wash is dependant on the          recommended to perform a compressor
growth and breakdown of the oxide             operating environment of the aircraft.       turbine wash immediately following the
scale layer. Depletion of chromium            In certain parts of the United States the    compressor wash.”
has not started. Mechanical integrity is      risk is lower than others. In general, the
not affected. Acceptable for continued        closer you are to the coast or any other     Alternative Measures
operation of the blade after addressing       body of water the more at risk you are of
the sulphidation and loss of oxide blade      collecting harmful salt and environmental      In addition to the washes, there
coating.                                      deposits. It is best to consult your shop    are some P&WC approved corrosion
  Stage 2 – Oxide Failure                     and work out a proactive approach to a       inhibiting products that can be manually
Roughness of surface is more evident          wash schedule that suites your mission.      applied to parts of the engine to deter
as breakdown of the oxide scale layer         A shop trained on your engine has the        future problems. These products, such
continues. Depletion of chromium from         tools and knowledge to help you map a        as LPS Procyon, can be obtained and
underlying alloy has started. Serviceable     course that best limits your chances of      applied locally. The application is a
subject to repetitive inspections per the     dealing with a corrosive issue. Regular      continuous effort, and must be re-applied
Engine Maintenance Manual (EMM).              boroscope inspections of the compressor      based on use and the environment.
Restoring the component to its original       inlet case and turbine blades will             Prevention is the key to keeping your
condition is unlikely.                        help to establish whether the wash           engine operating at peak efficiency and
  Stage 3 – Sever Sulphidation                schedule you have in place is sufficient     performance; and limiting the exposure
Oxidation of the base material has            to prevent corrosion and sulphidation.       to harmful contaminants that can do
penetrated to significant depth. Build-up     Operator experience may require a            costly damage. As mentioned earlier,
of blister scale noticeable. Mechanical       more aggressive schedule for peak per-       consult your shop and make sure you are
integrity affected.     Removal of the        formance and reduced maintenance             on the right path. •
blades as recommended in the Engine
Maintenance Manual (EMM).
  Stage 4 – Perforation
Deep penetration of attack with large
blisters of scale. Loss of structural
material will lead to eventual component
failure.
                                                                                                                                    9
                                                                  Aircraft Management
Why Aircraft Management?
Time Savings: Both in length of travel and productivity
during. Be home in time for dinner while accomplishing
more in the day.
Accessibility: Arrive closer to your destination by gaining
access to thousands of General Aviation airports compared
to the limited airline served network.
Versatility: Bring whomever and whatever you need to
complete your mission. Change directions mid-flight, add
destinations – whatever you need, the airplane is at your
fingertips.
Security: Both at the airport and in the air, feel safe knowing
your total travel experience is private and secure.
Investment: An aircraft can be one of the most useful tools
in your toolbox and as a bonus is eligible for substantial
business tax savings. Ownership has its rewards.
by Dave Conover
Re-Registration is Here!
   The FAA re-registation process was                   The FAA has outlined a specific set of           The FAA website reviews the process in
launched on October 1, 2010 with initial              procedures for owners to utilize that will       detail and is a good resource to evaluate
notices being mailed to the first group of            enable them to re-register on-line within        how your aircraft is currently registered
owners up for renewal. This process will              a 3-month window, then through a mail-in         with the FAA. It is important to have a
require all aircraft owners to re-register            process for the following 2 months. After that   valid mailing address on file with the FAA
their aircraft over a 3-year period in                date, if an aircraft is not re-registered, the   in order to receive notices. Whether a
accordance with the FAA schedule. The                 FAA registration on the aircraft will expire     notice is received or not, the re-registration
FAA believes that of the 357,000 registered           and notice of N number cancelation will be       schedule applies to all aircraft and
aircraft; at least 100,000 will not re-register       sent. If the FAA receives no response, the N     there are no amnesty provisions. Being
or have inaccurate records. Additionally,             number will be cancelled and unavailable         proactive and fully informed on this new
once re-registered, registrations will now            for assignment or reservation for a period       FAA regulation will keep your aircraft from
have a 3-year expiration date.                        of 5-years.                                      being grounded.