Shopping south of the border
 

At the risk of upsetting Canadian distributors of aviation goods, it’s time for owners and pilots to consider shopping south of the border.

For decades, buying goods south of the 49th parallel was not just expensive, but also a hassle for those not savvy about customs, taxes, courier services and potential shipping delays.

However, the balance has tipped in our favour with the current impressive appreciation of the Loonie over the Americanski buck.

My columns are not financial/investment advice in nature; however, my investment brokers advise that our dollar will not be this strong for long since the factors that have driven down the American currency will evaporate with time and as it strengthens, ours will devalue. Remember, that’s not my prognostication – although that’s the way I am betting with my assets.

So, back to aviation. For years we have bled Canadian personal wealth into chasing the commodities such as aircraft and parts that were surcharged effectively when bought in the USA. For the time being, that’s over!

The USA is hosting the first big sale of the century (since the mid 1970’s to be specific) after Prime Minister Diefenbaker gave us the Diefenbuck at 92.5 cents in the 1960’s.

He also scrapped the Avro Arrow, so what can I say…the only thing he did right by us was to check out!

Since his abusive reign and Trudeau running up large deficits, we have been gouged in everything from car sales to soup and nuts due to exchange rates and companies squeezing us to maximize their profits and now it’s our turn to be winners.

Back in the early to mid seventies, as the sales manager and chief pilot of a Cessna dealership in Calgary, we made and extra 3-4% on our sales because we bought in US dollars and sold in the higher Canadian.

For those of us who own aircraft that are typically denominated in the market with American dollar values – we have had a book value loss. (Have no fear, there will be considerable appreciation of our assets when the curve reverses in the future). Nonetheless, when it comes to parts and services for our aircraft, we have a winning scenario. Propeller and engine overhauls, avionics packages and parts are now cheaper than they have ever been in the U.S. market. This is coupled with the fact that supply and demand factors keep prices much lower than in Canada in most instances.

Before going any further - one caveat. Any work you are planning to have accomplished in the USA should be accomplished by a company whose "signature" and qualifications meet Transport Canada requirements.

This isn’t too much of a problem with the big shops as they typically have a lot of Canadian business and know the ropes. For instance, during my trip south to fly MD helicopters to the helicopter convention this winter I stopped in Portland at Flightcraft for a tour of their facility with Avionics & Components Service Manger Jeff Howell.

Linda and I talked with numerous staff members, toured the facility and were impressed with the shop equipment and capabilities. Customers we encountered were completely satisfied with the level of service. A repeated theme from clients was; "we would rather pay a fair price to a quality facility rather than have a budget quote at a lesser facility where the price subsequently escalates and problems are encountered with the overhauled component or installation."

Am I advocating treason? Personally, I prefer to spend my hard earned funds in my own country – but this is balanced by my desire to shop for bargains – my Scottish heritage. Experts suggest this "sale" isn’t going to last more than a year – if that – and this may be our last big buying opportunity – perhaps in our lifetimes. It’s been three decades since the last "sale" – so let’s face it, most of our current membership won’t be looking at the grass from the "right" side in another three decades.

Many Canadians have already capitalized on this dollar inversion and bought aircraft in the USA as well as services. The exception to this observation is Canadian made aircraft and parts which in effect are now cheaper as they too are typically denominated in U.S. dineros in terms of marketing.

Be sure to shop around for planes, parts and services. Be aware of taxes and in a few cases duties that may be required on your purchases. Research the shipping charges too because some of the couriers charge excessive fees for brokerage.

Also consider warranty implications. Ensure the U.S. company will provide a suitable warranty and determine what it covers and consider the expenses involved in making a claim across the border.

Buy now in relatively cheap American dollars and watch your aircraft appreciate when that dollar gains value against ours in the future – potentially…. And, before you buy American, be sure to check Canadian suppliers to ensure you are getting the best deal when all factors are considered.