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Plane Talk MAXIMIZING YOUR INVESTMENT
Weighing Your Options at TBO
Engine replacement is one of the more challenging aspects of owning an airplane. It has to be done at some point in time, and you have a limited set of options based on the type of engine that is approved for for your airplane.
To make matters more daunting, small, seemingly minor decisions made during the process can affect your wallet later on.
Every aircraft engine has a TBO, which is the manufacturer’s recommended time between overhauls. This is the manufacturer's idea of when the engine should be replaced or rebuilt, and it usually runs between 1,500 to 2000 hours for piston engines. While a well-maintained engine can make it well past TBO, prudent owners start weighing their options as the engine creeps up on that magic number.
There are four main options for an engine at TBO: Have the existing engine overhauled by your local shop, purchase an overhauled engine from one of a handfull of well-known engine re-builders, or purchase a remanufactured engine from the manufacturer. You could also purchase a completely new engine from the manufacturer, a costly and experts say, unnecessary step.
The least expensive option is usually to have your local shop overhaul the engine. Unfortunately, there are no iron-clad standards as to what constitutes complete overhaul, and workmanship can vary from mechanic to mechanic. Your engine retains its log book and number of hours, so if you choose to sell your airplane, the buyer will need to have confidence in the shop that did the
overhaul in order for you to get fair market value for the work.
Considering that the price difference between a shop overhaul and a factory overhauled engine is sometimes less than 10 percent, you may do better purchasing a rebuilt engine from the manufacturer
or a well-known rebuild shop.
A rebuilt engine is built to factory new tolerances and is a “zero time” engine. This means that your engine is effectively a new engine; worn parts are replaced and re-used parts must meet factory specs as new. In effect, you have a new engine for not much more than a rebuilt engine, but with added resale value.
Both of the major engine manufacturers, Lycoming and Continental, offer “quick swap” programs, where you can buy a rebuilt engine from them, and have it swapped for your existing engine. This minimizes down-time and keeps your airplane in the air.
The problem some owners run into comes from what the industry calls a “defective core.” Long after you have swapped out your engine, mechanics at the factory will have torn down your old engine and begun rebuilding it to sell it to someone else. Major problems such as a cracked case could result in additional charges of $3,000 to $5,000, long after you thought you were done paying for the engine.
Both Lycoming and Continental have policies regarding what they will charge you for. Lycoming recently revised its policy to state that as long as the engine was running at the time it was removed, there will not be a charge-back. Continental says they have always had that policy, and that few owners are ever charged.
Before swapping out your engine, be sure you get a written copy of the charge-back policy from the company you are buying the engine from. In many cases, there will be no charge-back if the engine was running or run-able at the time it was brought into the shop.
Also, weigh all cost options before making your decision, and talk to owners of similar aircraft to find out how your engine choice will affect the airplane's resale value.
Replacing the engine in your aircraft doesn’t come with a lot of choices, but the ones you do make are important and far-reaching, so consider carefully. 
—Sean Fulton
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