The Savings Power Curve
A lot of customers that work with Gemco are at first confused about how our Overhaul Savings program differs from a traditional engine builder's financing program. And, we here at Gemco like to relate it to the power curve that you're familiar with from your private pilot ground school. For simplification purposes, lets assume that your engine is a Lycoming O-320-D2J that will cost you around $22,750 to overhaul.
Think of the traditional engine builder's financing program as working on the backside of the power curve. If you wait until your engine needs an overhaul without saving any money in reserve with the intention to finance your purchase, you're falling further and further away from the lowest point on the curve, heading into high-drag territory. At the time of overhaul, assuming you put no money down, you will have approximately a $262.00 monthly payment to make over the next 10 years of your engine's life. This payment will be yours to make even if you decide to sell the aircraft to a new owner, the engine implodes, you lose your medical, etc. And, although we don't like to imagine those types of things happening, they do. As a matter of fact, switching airplanes is a common practice among owners as mission profiles change over their life. If you continue to follow this method of aircraft engine ownership and management, you could find yourself swimming in debt from multiple engines, multiple airframes, and multiple unforeseen events. You have, at this point, run out of options and reached your stalling airspeed.
Now, lets take a look at how working with Gemco's product can benefit you. First off, Gemco's product does not involve any credit. None, zero, zilch, nada. We don't run credit checks because we don't have to. Instead of being a passive owner, by enrolling in Gemco's Overhaul Program, you become a proactive owner. Assuming the same lifespan of 10 years, you'll pay about $265 a month into your Gemco account (About the same as the loan payment you would owe). But, what is happening when you pay into Gemco, instead of making payments to the bank? The simple answer is that you build equity in your aircraft that is both transferable between owners, and transferable between different aircraft instead of reducing your accrued liability. So, for example, if you decide that you want to sell your aircraft at some point between overhauls, you can either sell the airplane with the money saved into your Gemco account, or you can sell the airplane without that equity, and roll it over into your next aircraft. If you decide to keep your aircraft and want to operate beyond TBO, don't worry, our "Fly On" program allows you to do that. No hassles, no extra fees, and no additional payments.
As you can see, instead of being behind the power curve, we are on the front side. We have lots of airspeed, and are ready in case changing events necessitate a change to our ownership plans. By being a part of the Gemco program, you avoid saddling yourself with debt, avoid locking yourself into an aircraft that doesn't fit your mission, and can make your aircraft extremely marketable in the used marketplace. In fact, Gemco has found through working with its clients that an aircraft with its Overhaul Savings program attached will sell for over 15% more than an aircraft that did not.
To us here at Gemco, we think that this proactive positioning puts you in an advantageous position to make smart decisions about how you want to own your aircraft. And, to us here at Gemco, we take pride in the fact that our programs allow you to stay ahead of your airplane, and stay on the right side of the power curve. Because, hey, you're not behind your aircraft in the air, so why would you be behind it on the ground?