Overview
The Holstein Aviation professional team member first began this multi-year relationship with his client when the aircraft being used was a single engine turboprop. His client, an entrepreneur in the truest sense of the word, was a real estate investor who also owned multiple franchised motor cycle dealerships. Being present at many different locations frequently and in a timely manner was critical to profitably growing his business and successfully managing the investment portfolio.
Engine and systems redundancy was almost immediately identified as a key factor that needed to be addressed. Thorough evaluation brought a twin engine turboprop into use. Next, tax benefits and desirable upgrades were elements brought to the forefront, and a newer turboprop was purchased through the Holstein Aviation team member. Then the opportunity to obtain additional capability was reviewed, and a larger, faster turboprop with greater range and payload put to work. Finally the time arrived for transition into a faster mode of travel, and a light jet became the latest workhorse in the 20 aircraft he has owned.
When it came time to hire pilots, or address training issues, his Holstein Aviation associate was there with information and recommendations. In one case he even sent a pilot to bring his client and the aircraft back home when an event occurred while they were on a business trip.
There were one particular occasion over the years that the situation could have gone south. The first twin engine turboprop purchased presented multiple challenges and opportunities for a business relationship to flounder. However, his Holstein Aviation representative put everything into the proper perspective with one simple and declarative statement: "You can be assured that, at the end of the day, we will take care of you, as always."
He was, to the extent that this client has relied on his knowledge and experience to purchase five airplanes in the last six years with him.
Summary
While the aircraft have changed a lot over the years, one thing remains unchanged: a solid relationship built by maintaining focus on the client’s best interests and needs ─ even before he knows they exist.
Lessons Learned
Trust built on performance stands the test of time. Accomplishing your objectives is how we get paid, but building strong and lasting relationships is how we are measured. That’s what our clients come, but rarely go.
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...Caveat Emptor |
Overview
In the world of aviation transactions, the potential for severe turbulence always exists if proper protocol is not followed, and attention is not paid to every single one of the myriad of associated details. Historically, the majority of times aircraft are bought, sold or leased the entire process can be pre-calculated and made to go forward smoothly, efficiently and accurately. However, even with the most precise planning and detailed preparation, unforeseen circumstances can arise. Here is where your need for experienced, knowledgeable professionals is critical.
Summary
The most important component of any transaction is conducting exhausting and thorough research to gain complete and total knowledge of the aircraft in question, including its ownership, operational and maintenance history. Additionally, if disregarded or not managed correctly, all relevant aspects ─ such as FAA regulations, legal requirements, financing ramifications and intended missions or proposed areas of operations ─ can inevitably complicate transactions, precipitate substantial financial loss, or create serious, possibly unsolvable, problems in the future.
Creative writing. The Holstein Aviation team member was procuring a pre-owned turboprop aircraft for his client. As the log books were being reviewed, many years of experience triggered alarm bells. The maintenance record indicated there had been minor, and repaired, damage from a “bird strike”. While encounters with various flying fowl are not uncommon in aviation (think Captain Sullenberger, US Airways and the Hudson River), someone with lesser knowledge and expertise very likely may not have sensed a major problem.
Separate entries in the airframe log book recorded repairs to a wing leading edge and engine cowling air inlet. Another entry in the propeller log book showed a premature prop overhaul. Lastly, the engine log book revealed an extraordinarily early hot section inspection performed during the same time period.
Yes, there had been a bird strike. But the bird was sitting in a tree at the time! Further, detailed investigation revealed that the pilot had gotten too low on an approach to the airport in poor weather conditions, subsequently elected to go around, and in the process impacted tree tops ─ and the now deceased bird ─ which damaged the wing, cowling and propeller, along with the engine from the debris that went through it.
The aircraft’s market value was now significantly less than the proposed purchase price. As you probably have surmised, thanks to his Holstein Aviation professional, the buyer did not make the purchase, and a substantial loss was avoided.
Lessons Learned
Proceed at your own and great risk in an aircraft transaction, or utilize the knowledgeable, experienced and trusted professionals at Holstein Aviation. That way, Caveat Emptor or Buyer Beware, is nothing more than an ancient mantra, not a prediction of the outcome.
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...The Other Guys |
Overview
We are all human, and mistakes do happen. But, as our clients will testify, the chances for problems to occur fall somewhere between slim and none when Holstein Aviation is looking out for your best interests. Unfortunately, others weren’t as fortunate as you will be when you have our team of professionals on your side.
Summary
Errors of Omission. The large cabin, long range aircraft was purchased from a major, widely recognized telecommunications provider and then leased through a third party. The buyer’s attorney, while undoubtedly good at his profession, was not particularly knowledgeable of or experienced in some of the aviation transaction nuances. Consequently, the lease was never recorded with the FAA, resulting in the company being subject to a fine of $1,000 per movement. It was not until a new Director of Aviation came on board more than a year after the purchase and began his operational assessment that this major problem was discovered. Potential liability was well in excess of $100,000!
The Scam. While there are many variations, a common approach is where the purchase offer regarding an aircraft listed for sale arrives via email. Attached is a signed contract with very reasonable terms, minimal or no price negotiation, and only the requirement that the seller sign the agreement to execute the sale. A substantial purchase deposit purportedly will then be put into escrow.
Unfortunately, when a seller goes it alone without professional advice and assistance, an uninformed, albeit normal, response is to sign the agreement prior to the deposit being made. Then an “official looking” email arrives stating that the seller is required to wire $10,000 to an account in a European financial institution for purchase of “bank-required title insurance”. Of course, this requirement, the buyer and everything else involved is fictitious. When the fraud is perpetrated, the seller certainly is now much wiser, but also definitely much poorer.
Different Countries. Different Rules. The European Union requires US-registered aircraft operating within the EU for longer than seven days to be “imported”. If not, the operator is subject to a Value Added Tax (VAT) on the aircraft. Properly completed paperwork and a $1,000 fee will yield a “letter of association” that allows flights within and between EU countries for up to six months.
Failure to comply with this regulation can have disastrous results, as an unnamed aircraft manufacturer learned the hard way. They based an aircraft in Geneva for their customer to use while awaiting delivery of a new aircraft. However, Switzerland is not a member of the European Union. Shortly thereafter the aircraft was impounded in England upon landing there. Twelve days and $125,000 later in fines and legal fees, the aircraft was released.
Lessons Learned
Even experienced operators or flight departments are still only usually involved in buying, selling or leasing an aircraft on occasion. Yet the potential for costly and perhaps even unsolvable problems never looms larger than during an aircraft transaction. When you rely on the experience and expertise of the professional team at Holstein Aviation, you’ll learn a lot, but not at a high cost. |
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