““CEOs go to their vacation homes just after companies report favorable news, and CEOs return to headquarters right before subsequent news is released. More good news is released when CEOs are back at work, and CEOs appear not to leave headquarters at all if a firm has adverse news to disclose. When CEOs are away from the office, stock prices behave quietly with sharply lower volatility. Volatility increases immediately when CEOs return to work.” —David Yermack, a New York University finance professor, whose recently released study shows a correlation between when CEOs take their private jets on vacation and movements in their companies’ stock price ”
Mothballing your airplane
The recession's lingering effects may prompt you to consider storing your aircraft until conditions improve. That can make sense if you need to slash your flying costs yet don't want to sell your airplane while prices are depressed. But there is a risk in storing aircraft for more than about 30 days that you must consider: an unused aircraft can deteriorate, which can have safety implications as well as financial ones.
All business aircraft and engine manufacturers have established storage maintenance procedures for their products. And if those procedures aren't followed, expensive engine bearings, electronics and components could suffer damage.
The greatest risk is to an aircraft's turbine engines, according to Rich Schuller, founder of Scottsdale, Ariz. consultancy Sextant Advisory. The bearings that support the main shafts of these engines are made of hardened steel, usually a variant called M50. As long as M50 bearings remain properly lubricated, they can withstand extremely high temperatures while the engine spins tens of thousands of times per minute. But the only way to keep these bearings lubricated is to spin the engines, either by running them on the ground or flying the airplane.
"The main concern is protecting the bearings," said Mike Bevans, Honeywell senior manager of technical sales for engines. Honeywell's TFE731 turbofan powers many business jets, including the Hawker 800 series, Falcon 50 and 900, various Learjets and some Cessna Citation models. For storage from 30 days to six months, Honeywell recommends motoring the engine (without allowing it to start) every 30 days to a speed high enough to coat the bearings with oil.
For storage lasting longer than six months, Honeywell advises additional treatment, including replacing fuel in the fuel control with special lightweight oil, while Gulfstream says that fuel needs to be drained to prevent buildup of fungus and the resulting corrosion. "If an airplane is improperly stored, the costs associated with corrective action could be significant," said Gulfstream director of customer support Mitch Choquette.
Some manufacturers require occasional operation of aircraft systems like flaps and electronics to keep them free of moisture. Other parts may need more frequent lubrication or preservative coatings to prevent corrosion. For an airplane kept outdoors in long-term storage, moreover, windows should be taped over and avionics removed. In a business jet, all of this is "a very expensive proposition," said George Kleros, vice president of technical operations for Chicago-based JSSI, which offers maintenance cost-per-hour programs.
The expense is not just the hundreds of man-hours needed to prepare the aircraft for mothballing and maintain it while it is in storage but also the cost of restoring it
to active duty. Mechanics have to reverse all the work done to preserve the aircraft, test all systems and perform any overdue inspections or maintenance.
Whether the owner chooses long-term storage or shorter-term ground runs, all the work done must be documented in the aircraft logbooks. The data required includes the duration of the engine run and instrument indications verifying proper oil distribution, not just the fact that the run was accomplished. "The more information you put in the logbooks, the better off you are," said Kleros.
The idea here is preservation and prevention, explained David Rowl, director of propeller product support for Hawker Beechcraft. Without proper preservation, he said, the list of required items and potential problems that may need to be addressed to bring an airplane back to service could be lengthy and "very costly, depending on the severity of the damage."
This advice is also relevant to aircraft buyers. A used airplane that has been stored for any period of time should raise red flags. If the required storage maintenance hasn't been done, you should ask some important questions about how that could affect the quality of the multimillion-dollar asset you're about to buy. Corroded M50 engine bearings could cause a catastrophic engine failure. But lack of documentation of proper engine runs and/or motoring may mean that the engine needs to be torn down to inspect and possibly replace the bearings at a cost of hundreds of thousands of dollars.
Sextant consultant Schuller and JSSI's Kleros warn that lack of proper storage may also violate terms of engine manufacturer cost-per-hour agreements. "In our contracts," said Kleros, "there is language that states you must follow the manufacturer's maintenance manual and recommendations." If a JSSI customer decides not to fly for a period of time, JSSI collects a minimum suspended-contract fee but not the normal per-hour fee. When the owner is ready to resume flying, JSSI sends a technical manager to look over the aircraft, engines and logbooks to make sure everything is airworthy.
Honeywell's cost-per-hour program doesn't specifically mention preservation but simply mandates that participants follow all of the manufacturer's maintenance manual and service bulletin practices, to ensure ongoing coverage. To help buyers of aircraft with Honeywell engines that haven't been stored correctly or for which documentation isn't available, the company has a damage review board that will evaluate the health of the engines.
Owners also need to consider the health of their aircraft's auxiliary power unit, the tiny turbine engine that generates electricity on the ground for air-conditioning and engine starting. The APU should be run as often as the engines, and the simplest method is to start the APU and use that to motor the engines, according to Honeywell's Bevans.
Aircraft owners must be aware of these issues, concluded Schuller. "The concern is that the CFO or CEO responsible for the aircraft is just parking it," he said, "not knowing that there is a requirement for storage or preservation. They're just going to let it sit, but then the day comes when they try to sell or reactivate the aircraft and suddenly it's a big issue."
Not flying? Here's how to store your aircraft
If you decide to ground your aircraft for more than 30 days, here are the steps you must take to preserve its health and value, according to business jet maker Hawker Beechcraft.
• Have your mechanic or service center evaluate all aircraft, engine and component manufacturer recommendations for storage.
• Keep the aircraft in a hangar if possible.
• For outside storage, cover windows and recognition/strobe lights with barrier material and pay attention to atmospheric conditions, as humidity will accelerate corrosion. Make sure all control locks or control column gust locks are installed to prevent movement of flight control surfaces.
• If required, install lock pins on emergency escape hatches.
• Install protective engine covers and, if required, moisture-absorbing desiccant bags.
• Drain fuel from engine fuel controls and install preservative oil.
• Once a month, motor engines for specified intervals.
• Remove and store lead-acid and nickel-cadmium aircraft batteries.
• Lubricate flight control hinge pins.
• Keep tires inflated.
• Rotate tires at specified interval or place aircraft on jacks.
• Coat exposed surfaces of hydraulic actuators with preservative hydraulic oil.
• Drain toilet.
• Cover sensitive electronics to prevent dust accumulation.
• Cover seats.
• Ground airplane to grounding jacks.
• Make sure all work is documented in the appropriate logbooks.