Cheap Transportation

[Jon Wehrenberg]

This is almost like a JPJ post. It doesn't mean anything significant but it may be of interest.

Summarizing the expenses for taxes this year I started digging a little deeper to see if I could get a better understanding of what things really cost.

Not counting depreciation or loss of earnings on invested capital (or interest) my bus costs me $1.21 per mile.

So I did the same research on the plane. It makes the bus look like a bargain. My plane costs me $2.26 per mile.

Obviously these numbers can be manipulated a little if I wanted to capitalize some repairs, but over several years of expense history the numbers hold up pretty well.

My numbers are unlikely to equal anybody else's numbers because of certain factors. I do all my own work. Bus and plane (except avionics). For the plane I do not do my annual inspections and I have to have mechanics look at and sign off my work. That is not true of the bus, and I do almost 100% of my work on the bus. Offsetting my use of my own labor on the bus may be the fact I may do more maintenance. My normal interval is 5000 miles, and I do things like change air bags or brake chambers when they are still working perfectly well.

I reset my Pro Driver with each 5000 mile service interval and I have recorded mileage of 8.12 down to my current of 7.25. I'm sure the new fuel has had an impact.

As stated previously these numbers can be altered by amortizing the cost of such things as tires, air bags, batteries, etc. but my calculations are based on expensing things when they are incurred.

Just thought I would throw this stuff out there since I have never seen any cost per mile information.

[Jerry Winchester]

My math must be off.

If my calculations are close, my coach roughly costs me $.84 / mile while my airplane cost me $1.20 per mile. The annual mileage was 11,000 for the coach and +/- 21,000 miles (according to the GPS) for the Bonanza @ about 120 hours per year.

I calculated diesel fuel at $2.50/gal and AV gas at $3.30/gal.

I was told that a simple estimate of the hourly cost for a single engine non turbo is 3x the hourly cost of fuel or around $158/hr for the V35 (plus the actual fuel cost). And this number would include insurance, annual inspection expense, engine / prop overhaul expense (prorated) and misc. maintenance. (This could be total BS)

16 GPH x $3.30 x 3 = $158.40/hr x 120 = $19,008 + $6,336 (fuel) = $25,344
$25,344 / 21,000 = $1.20 mile

The bus 11,000 miles / 5.5mpg = 2,000 gal x $2.50 = $5,000 then add oil change ($400 yr), maintenance (+/-1,500 yr), tires ($960 / yr), insurance ($600) overhaul ($.07 mile= $770)= $.84 per mile (I SWAG'ed the overhaul cost based on major components with a 500,000 mile life which given this kind of use may be way high)

Also, it costs $50 to have the coach washed and it cost me a fingernail today to wash the plane :o

Okay, what did I do wrong? Oh, I did forget you have a Liberty :eek:

[Jon Wehrenberg]

If I didn't pay for it (such as an overhaul) It wasn't included. It did include on both all fuel, all maintenance expense, insurance, charts and subscriptions (as in the case of the plane).

The bus for example used almost $4000 worth of fuel. I noticed that until the end of the year fuel costs were between 2.65 and 2.75.

The plane has huge expenses before I put on the first hour. Insurance for a pressurized plane is not for the faint of heart. Add hangar rent, charts and subscriptions such as GPS, XM WX, etc. and I'm already at $10,000. At todays cost of fuel a cheap fill up is still costing me around $50 and hour with a typical fill up around $60 at 15 GPH and $4.00 a gallon. This year I installed a complete new turbo system and the plane ate an HSI and Strikefinder.

The bus this year got treated to new air bags, coolant and transmission oil changes, some tires and had a refrigerator that ate a few bucks, but I finally got it working.

My point is that when I do this exercise and review broad time periods the ratios are similar to the above. The only way to drop the operating costs is to put a lot more use on both. Spreading the age related items among greater miles or hours on the bus such as insurance, tires, air bags, and coolant will bring my cost to the same or lower than yours. Next year I only have four tires so unless something pukes the bus cost per mile should drop.

The plane hours aren't going up because I am no longer flying the hell out of it for business so I accept the penalty to have the convenience of it. I think your plane is an NA, and your insurance on a four place non-pressurized is likely half mine so if I were to eliminate the expense of my turbo system, and cut my insurance in half we would be getting close.

I used to do the spread sheets with engine hours and other items amortized and after 20 years of ownership, I eat the expense when it is incurred and that year looks like hell, but then I usually get some fairly cheap years to average things out. This isn't for taxes so I don't waste my time on the depreciation of major items.

[lewpopp]

Jerry

You had the insurance on the bus at $600. How do you do that and have any insurance?

Lew

[Jerry Winchester]

Because I don't have to carry a nuke powered defibulator and a bulk tank of Metamucil around with me.

[Joe Cannarozzi]

I was wondering the same thing and will be pricing around come Monday.

I know geographic location matters but how much I don't know.

[Alan__]

Jerry - What kind of coverage due you have for $600? Liability, comprehensive, collision, UIM ....??

[Jon Wehrenberg]

Be careful on that insurance Jerry. Mine is $1900 and I know if I have a problem it will be taken care of correctly. For $600 you may end up having a conventional RV dealer working on your Prevost.

[Joe Cannarozzi]

I'm currently paying 1100 for St. Farm in the Chicago region for an 86. I was thinking that was decent?

[JIM CHALOUPKA]

Jon /Jerry, Where did either of you address batteries. They seem to be a large expense, such as tires. Were they left out because in that year you did not replace them? JIM

[Jon Wehrenberg]

They were not replaced during the period I gathered expenses. But, with two steer tires this year plus air bags, four drive tires next year and no batteries costs will not be much different than 2 years from now when my batteries are due.

Jerry is using theoretical costs and I am just adding up what I wrote checks for. Over an extended period of time it is likely both will be reasonable accurate.

I said it in another post. If you were to add depreciation and the cost of the invested capital to these figures you would never own one of these buses (or a plane) because it would not make sense. In fact, the expenses I incurred owning the coach this year are likely less than the interest on the depreciation for the first year of a new coach. But....who cares? We all have worked hard and earned the right to enjoy doing exactly what we want.

[Coloradobus]

Costs!?? I hate the word. We ate it this past year big time.
Starting, last year February a trip to Marathon Dallas. Due to bad electricity, we encountered a $2500.00 marathon reprogram bill that didin't fix the trouble. They threw parts at the problem, didn't have a up to date database for our coach.
Then, off to Oregon Marathon to solve the trouible last September......they have the data for our coach...$5000.00. Then a trip to Mira Loma last month for chassis lube, airsystem purge/dryer filter change. and also a tag airbag change (still leans overnight) plus a few extra personally installed items, added up to $1600.00 So in a year just for coach work (chassis/house) $9100.00 OUCH!!:eek: :(
I want to know if Prevost has a separate fee scale for motorhome shells vs commercial seated shells. I don't think a commercial bus company could stay in business if they paid Prevost what we paid this past year. Yikes.
I have learned to buy my own oil at Advanced Auto Parts, take it to our local Stewart-Stevenson and for 150 bucks presto engined serviced. Advanced Auto by the way has Mobile Delvac 1300 for nine something a gallon. S-S had the same oil for 15 bux a gallon.
Something to watch for: when indicating a chassis lube. Our tech went around and lubed the chassis, marked such things as OK, wheel hub oil, "OK", front bumper hinge/latch lubed "OK", and entry door hinges/latch lubricated,,"OK"........NO ONE removed the Marathon hubcaps off the steer or tag, let alone took off the Marathon fluff stuff that adorns the entry door hinges.
They initially charged us " 3 hours" for this service. I had to call and mention things that we were charged for didn't happen, because removal of certain items to complete the task did not come off.
Wish we lived closer to Tennessee.:D

[Jon Wehrenberg]

CO bus,

What you just did was almost as bad as revealing the secret handshake.

Peter previously posted how Liberty rips us off by not providing wiring diagrams and he was giddy with joy because his Marathon folks send him all he needs. But then you go and reveal that the Marathon path to your wallet is not through the wiring, but re-programming.

But that wasn't bad enough. It almost sounds like you were suggesting that the way you are now treated at Camp Prevost is less than satisfying. I'm aghast.

The short version is our transportation ain't so cheap. No matter who put the pieces together. Sales are going to fall off because of this.

[Joe Cannarozzi]

Troublemaker

[Petervs]

Jon,

Your analysis of the costs is completely irrellevant without the depreciation or loss of invested capital. I know you said this, bit then you went ahead and analyzed the rest of your expenses.

So let me ask you, how much does it cost to taske your wife out to a nice dinner and a movie if you do not count the cost of the movie tickets or the food? Your coach expense analysis uses the same flawed logic.

If we take an'average' coach at $500,000 and choose 7% as the rate (because it would cost that to finance it or you could earn that if you invested it, and we need to pick some number in any case) then the loss of income from the investment is $35,000 per year before taxes.

I have owned my coach for 5 years and it has depreciated $13,000 per year on average so far. If I keep it 15 more years I think the annual depreciation will be about the same for the whole time.

Anyway, these $48,000 annual "costs" completely overshadow your cost of fuel, maintenance and insurance.

As for the airplane expenses, well for a while the numbers there were very different because airplanes were appreciating like crazy. My 210 went from $25,000 when I bought it in 1986 to over $100,000 in 2000 when it had a near run out engine. Today it is worth about $110,000 but I spent 60k on engine, paint and interior.

The choices we make as to how to spend our time and money are often not rational, we do what we think is fun and interesting. At least with coaches there is an upper limit. 45 feet is as big as you can drive down the highway so they wil not be getting bigger. Try to compare with boats, as soon as you buy a real nice 45 foot yacht, some one else comes along and buys a 95 footer, or a 195 footer , or a 525 footer! Seriously they exist, but I doubt they have as much fun as we are having.

Oh, yes, as for Marathon charging lots of money for programming, well, just another reason to own a slightly older coach that is hard wired and not computerized. No programming and I can run and trace the wires.

Peterr vS
94 Marathon XLV

[Jerry Winchester]

No, I didn't figure in the house batteries (which I actually changed this year - ouch). I really didn't take much of the house stuff into the equation because I didn't take paint, avionics and interior work into account for the plane either. I was just trying to get to a semi base number for driving the thing around. And as Jon mentioned, no accounting for cost of capital which is about the same for both of them as they have almost the same value, so I washed it out as well. However, the airplane appreciates every year while the coach deprciates.

My insurance is thru State Farm. I have a vintage coach with high deductables that mirror the coverage on my pickup. Since I don't drive the coach to work in Harris Co. Texas, it gets much cheaper. My plane insurance is another issue. It is almost $1900 a year and has been thru USAIG for a long time until this past year. They went up a bunch and I switched.

[JIM CHALOUPKA]

Jerry, Every time I scroll down through the posts and I see your handsome avitar, I can't help but think you are looking a little like Lew! :D JIM

[Jerry Winchester]

Jim,

I have switched over to my Lew avitar. Is that better?

JDUB

[Jon Wehrenberg]

Peter,

I can't disagree with you. My original way of looking at the cost however is the simplest answer to the question about "what does that thing cost you to own each year."

As far as planes go, there is nothing rational there. If I run out my engine the selling price will not be down low enough to make me want to re-engine it before selling, and if I were to replace the engine it would not get high enough to make it worth doing. It gets even screwier with avionics, paint and interiors.

I was noodling around Phil Coopers and the Prevost Stuff sites today and coaches in our vintage or older have to be the buy of the century when compared to newer ones, but the market is apparently spending its money on the newer shells with slides proving we buy things because we want to and not because any of it makes sense. I have always maintained that the single largest expense we have owning our coaches is depreciation and interest on invested capital until the coach gets seriously old. I guarantee if an owner had to write a check every year for the depreciation on these coaches the market would be destroyed.

[Coloradobus]

NO secret handshake cut loose here, just a learning experience. Kevin Erion was there looking over a bus and saw our fiasco. He made a recommendation to ask for certain "Tech" to do our service work next time. That would eliminate our coach being a guinea pig. In the end it all worked out, but the time and energy dealing with a bill that was written up by a computer, has taught us to rectify our account before we leave. That way, I won't have to peel Chris off the ceiling when the mail comes.
We are the second owners of our coach. Somewhere in the past, the programming had had some horrific changes made, not by Marathon. Only Coburg had the specific guru who was able to wade through the mess. He did and the coach is ship shape now.
Its all a learning curve. Just when you think it is safe........:)

[Stelan73]

As a new guy I have to comment on the depreciation curve being more step on the front side of double sides. Coaches follow the same curve as most autos except we're dealing in a lot more money. Prevost owners drive the Rolls Royces and like Rolls have higher operating cost and higher levels of depreciations. We in our own way love it because we can or we wouldn't do it.

[JIM CHALOUPKA]

Jim,

I have switched over to my Lew avitar. Is that better?

JDUB

Much Much better Jerry, I was about to comment on your Ass but its gone. Your alumnae friend would be Most suitable!!
:D :p :D JIM