PistonPower / 26-Apr-2026
This response [from PistonPower] is prompted by an article submitted by Paul Koch and published on the Diamond Pilots Association website, with permission of the association.
PistonPower was founded in 2017 by Ron Zilberbrand. Prior to that, in 1989, he founded Jet Support Services, Inc. (JSSI) – the world’s largest independent provider of Power-by-the-Hour (PbtH). The company was sold in 2008, and today JSSI is an $800,000,000.00 venture.
Power-by-the-Hour was started by Rolls-Royce in 1962, and today, thanks in part to JSSI, the first item listed on a Business Jet or TurboProp spec sheet on “aircraft for sale “are the Power-by-the-hour Programs the plane is enrolled on.
Before Mr. Koch signed his agreement with PistonPower, we had several discussions with him to answer any questions that he had.
The Tip-to-Tail PbtH program is a five (5) year agreement, that renews after five (5) years, at a pre-contracted rate. “Tip-to-Tail” is a marketing term used by PistonPower. It does not mean that every single nut, bolt, and screw will be covered. What is covered are those specific items that are listed on Exhibit C of the agreement with the client. PistonPower pays for 100% of all scheduled and unscheduled maintenance on the airframe and engine(s) that are noted in the agreement. Covered components are listed in the agreement under “Covered Components” and “Scheduled Service.” If it is listed in the agreement, then it is covered; if it is not listed in the agreement, then it is not covered. This is as transparent as it can be.
Covered and Uncovered Items:
PistonPower does not cover service bulletins (SBs) or airworthiness directives (ADs) because there is simply no way to guide pricing; If there was, SBs and ADs would be covered and the enrollment and monthly fees would reflect those costs. PistonPower uses the money paid to it by its clients to pay for all of the scheduled maintenance and underwrites the unscheduled maintenance events.
If an AD or SB becomes scheduled maintenance, we add it to the “Scheduled Maintenance” section of the agreement and it becomes a covered event. This was done for Mr. Koch’s aircraft when an SB became scheduled maintenance, which saved him over $10,000.00.
The 5-year term of the agreement reflects a reasonable period of time during which many details used in calculating the fees have changed. It’s an opportunity to ensure the agreement properly prices changes in risk.
PistonPower does not pay any sales tax, tariffs, import duties, disposal fees, shop fees, etc. as these are not maintenance issues. Current agreement rates are based on $150.00 per hour for labor, but if a client chooses an MRO that charges over $150.00 per hour, they can either pay the difference or choose another shop. Some shops are willing to pay for fuel to get the client to bring in their aircraft to them, but not all do. PistonPower will of course help its clients find the best MRO to service their aircraft.
Power-by-the-Hour Rate Adjustments:
The costs associated with the agreement are subject to substantial inflation risk, for both parts and labor. Repricing is essential to ensure reserves to cover both scheduled and unscheduled maintenance events, and this is clearly set forth in every agreement.
The hourly rate is not adjusted based on utilization. However, the total is calculated by multiplying the hourly rate by actual hours flown. Fleet expenses are not used to calculate rate adjustments. Rates include an administrative fee.
No Refund of “Account Balances”:
The PistonPower program is not a “Christmas Club.” If an owner desires to put money in a savings account in order to pay for any maintenance event when it occurs, they can do that, but that is not what PistonPower does. An easy way to think about this is health insurance. If someone pays $10,000/year in health insurance, but never visits a doctor, they do not get a refund of their insurance premiums at the end of the year just because they did not use the coverage. PistonPower is not an insurance company, but this is an easy way to understand why there are no refunds. PistonPower pays for a covered event regardless of how much PistonPower has been paid by its client. Even if a covered maintenance event costs more than the client paid to PistonPower, that covered maintenance event is paid for by PistonPower. It is a calculated risk by PistonPower to ensure that it is paid enough in fees to cover all maintenance events that it is required to pay for under the agreements. There is substantial exposure to labor and parts inflation in addition to significant costs for unscheduled maintenance.
PistonPower programs pay for future maintenance with today’s dollars, leveraging inflation savings on an event that may not occur for 10-12 years. Program coverage adds value to the covered aircraft, which can be seen from the fact that both Blue Book Price Digest and VREF include maintenance programs in their valuations. Programmed aircraft are simply more valuable.
What Does this Mean:
Power-by-the-Hour programs have been around for decades and accepted by thousands of owners, operators, leasing companies, banks and OEM’s who today all offer a take-off of these programs.
Rates all get adjusted annually based on increased costs to the program, and agreement language will change over 5-years, as will inspections and covered components.
Programs stay with the aircraft, and once enrolled, the plane never comes off the program. Programmed aircraft will “ALWAYS INCREASE IN VALUE” because of the pre-paid maintenance effect, and the fact that all programmed aircraft are covered from unscheduled events as long as the plane stays enrolled.
