Field Overhaul vs Factory Overhaul vs Factory Rebuilt vs New Engine: Cost, Warranty and Value
When the engine is due, the first decision isn't how to pay but what to buy. This guide compares the four options for owners and buyers weighing an overhaul quote: what each one is legally, what it tends to cost, how warranties differ, and how each changes appraised value and loan-to-value.
What is the difference between a field overhaul, factory overhaul, factory rebuilt and new engine?
The legal distinction comes from 14 CFR 43.2. An overhauled engine has been disassembled, cleaned, inspected, repaired as necessary, reassembled and tested to approved standards. A rebuilt engine must meet "the same tolerances and limits as a new item," using new parts or used parts that conform to new-part limits. 14 CFR 91.421 lets the owner of an engine rebuilt by the manufacturer, or an agency it approves, use a new maintenance record without previous operating history.
| Field overhaul | Factory overhaul | Factory rebuilt | Factory new | |
|---|---|---|---|---|
| Who does it | Independent engine shop or repair station | Engine manufacturer | Manufacturer or manufacturer-approved agency | Manufacturer |
| Standard | Approved standards. Parts may be returned at service limits unless you specify new limits | Approved standards (overhaul) | New-part tolerances and limits | New production |
| Logbook | Keeps total time. SMOH restarts | Keeps total time. Often listed as SFOH | New logbook, zero time allowed | New logbook, zero time |
| Lycoming TBO under SI 1009BF (listed models) | 2,000 hr. A 200-hr extension is possible with only genuine parts and Lycoming-approved procedures | 2,000 hr, with a 200-hr extension described for factory-overhauled engines | 2,600 hr for the first run | 2,600 hr for the first run |
| Relative cost | Lowest | Middle | Higher | Highest |
| Warranty | Set by the shop. Terms vary widely | Manufacturer's terms | Manufacturer's terms | Manufacturer's new-engine terms |
| How you get it | Your engine overhauled and returned, or an exchange from the shop's pool | Usually an exchange (core returned) | Exchange (core returned) | Outright purchase, often with core credit |
Two details change the comparison. First, "field overhaul" covers a wide range: an overhaul to new limits with new cylinders by a well-known shop is a different product from a minimum-standard job. Ask every shop in writing whether parts are returned to new limits or service limits. Second, Continental uses the same zero-time concept for its factory-rebuilt engines, sometimes marketed as "remanufactured" (hence SFRM in listings). Its TBOs, in SIL98-9, vary by model and serial number.
How much does each option cost?
Pricing varies by engine model, configuration, shop, core condition and parts availability, and it moves year to year. The bands below are rough 2026 planning ranges, not quotes. Real quotes can fall outside them, especially for turbocharged, rare or high-horsepower engines.
| Engine class | Field overhaul | Factory overhaul | Factory rebuilt | Factory new |
|---|---|---|---|---|
| Four-cylinder (O-320, O-360, IO-360) | ~$30k–$45k | ~$40k–$55k | ~$45k–$65k | ~$55k–$80k |
| Six-cylinder normally aspirated (O-470, IO-520, IO-540, IO-550) | ~$45k–$65k | ~$55k–$75k | ~$65k–$95k | ~$80k–$110k+ |
| Turbocharged six-cylinder | Typically above the normally aspirated figures. Quote individually. | |||
Read quotes carefully. Some include accessories (magnetos, fuel servo or carburetor, starter, harness, plugs) and some don't. Exchange prices assume a serviceable core, and a crankcase or crankshaft that fails inspection can add core charges after the fact. Budget removal and reinstallation, shipping, hoses and baffles, and a contingency on top. Our engine overhaul financing guide shows a full budget build and the payment on it.
Which option costs least per hour of engine life?
The sticker price ignores how long each option lasts. Divide the cost by the TBO it earns. The example below uses a Lycoming O-360 with TBOs from SI 1009BF. The prices are assumptions inside the planning ranges above.
| Option | Assumed cost | TBO (hours) | Cost per TBO hour |
|---|---|---|---|
| Field overhaul (base TBO) | $38,000 | 2,000 | $19.00 |
| Field overhaul (qualifies for 200-hr extension) | $38,000 | 2,200 | $17.27 |
| Factory overhaul (with 200-hr extension) | $48,000 | 2,200 | $21.82 |
| Factory rebuilt, first run | $55,000 | 2,600 | $21.15 |
| Factory new, first run | $68,000 | 2,600 | $26.15 |
On these assumptions, the gap between a field overhaul and a factory rebuild narrows from $17,000 up front to $2.15 per hour. The rebuild also brings a zero-time logbook. The extension matters only if you'll actually fly the engine to TBO. At 100 hours a year, 2,600 hours is 26 years, far past the 12-year calendar limit in the same SI. Low-utilization owners should run the calendar version of this math in the SMOH and TBO guide. Also note from AOPA's July 2026 coverage that engines subject to AD 2012-19-01 and not yet in compliance don't get the extension.
How does each option change appraised value and loan-to-value?
Lenders lend a percentage of appraised value, not of what you spent. AOPA says aircraft lenders "will generally add value for most avionics upgrades and major engine overhauls" but usually not for paint and interior (AOPA). How much value an appraiser adds depends on comparable sales and engine time. A zero-time factory engine may appraise somewhat higher than a field overhaul with the same hours, but rarely by the full price difference.
Worked example (all appraisal figures are illustrative assumptions): a single appraises at $150,000 as-is with a run-out engine. The owner owes $90,000 and wants to roll the engine into a refinance at up to 80% loan-to-value.
| Option | Cost | Assumed as-completed appraisal | Value added / % of cost | Needed (payoff + engine) | Max loan at 80% | Cash required |
|---|---|---|---|---|---|---|
| Field overhaul | $45,000 | $180,000 | $30,000 / 67% | $135,000 (75% LTV) | $144,000 | $0 |
| Factory rebuilt (zero-time) | $65,000 | $190,000 | $40,000 / 62% | $155,000 (82% LTV) | $152,000 | $3,000 |
| Factory new | $80,000 | $195,000 | $45,000 / 56% | $170,000 (87% LTV) | $156,000 | $14,000 |
The pattern holds whatever your exact numbers: each step up the ladder adds value, but a smaller share of its cost. At a fixed loan-to-value cap, the premium options are more likely to need cash at closing. If you're financing, get the lender's view of the as-completed value before you choose the engine. Our guide to appraisals and loan terms explains how appraisers build those numbers.
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How do warranties differ?
Warranty terms change and differ by provider, so compare the written documents rather than the brochure. For each quote, write down:
- Length: months and hours, and which runs out first.
- Scope: parts only, or parts and labor. Is removal and reinstallation covered, and at what labor rate?
- Proration: does coverage shrink over the warranty period?
- Where claims are handled: at any shop, or only after shipping the engine back?
- Conditions: break-in procedure, oil type, operating limits and record-keeping you must follow.
- Transferability: does it pass to a buyer if you sell? A transferable warranty is a real selling point.
How does the choice affect resale?
- Hours remaining matter most. Buyers price engines mainly on time left to TBO and calendar age. A zero-time engine with 1,500 hours on it is not worth more than a well-documented field overhaul with 200.
- Pedigree matters at the margin. A factory-new or rebuilt logbook, or a field overhaul by a nationally known shop with full paperwork, is easier to sell than an overhaul by an unknown shop with a thin work order.
- Documentation always pays. Keep the itemized work order, the parts list (new vs reused, new limits vs service limits), dimensional data if the shop provides it, and the break-in records.
- The new TBO shows up in pricing. Under SI 1009BF, a factory-new or rebuilt Lycoming on its first run has 400 to 600 more hours of recommended life than the same model after a field overhaul. A buyer running reserve math will notice.
For the buyer-side arithmetic on engine time, see how engine time affects aircraft value.
Decision rules
- Keeping the aircraft through a full engine run: compare cost per TBO hour. Factory rebuilt often competes with a field overhaul once the 2,600-hour first run is counted, if you'll fly enough to use it within 12 years.
- Selling within two to three years: a well-documented field overhaul from a reputable shop usually recovers more of its cost than a premium engine. Or sell run-out and price accordingly.
- Engine with damage history or a doubtful core: a factory exchange shifts core risk to the manufacturer. Just read the core-acceptance terms.
- Higher-value airframe: buyers in that segment tend to expect factory-new or zero-time engines, so the premium is more likely to show up in price.
- Financed at a fixed LTV cap: ask for the lender's as-completed value before choosing. The cheapest option may be the only one that needs no extra cash.
How this guide differs from related guides
This page compares engine options and their effect on value. For the ways to pay, with payment tables, see engine overhaul financing. For what a buyer should pay for a given engine time, see engine time and aircraft value. For the definitions of SMOH, SFRM and TBO, see SMOH vs TBO explained. For hourly engine programs, see engine programs and resale.
Frequently asked questions
What is the difference between a field overhaul and a factory rebuilt engine?
A field overhaul is done by an independent shop and may return parts that are within service limits. The engine keeps its total time and restarts SMOH. A factory rebuilt engine is brought to new-part tolerances by the manufacturer or an agency it approves. Under 14 CFR 91.421 it can start a new logbook at zero time. Rebuilt engines usually cost more.
Does a field overhaul reset an engine to zero time?
No. A field overhaul resets time since major overhaul (SMOH), but the engine's total time since new carries forward in the logbook. Only an engine rebuilt by the manufacturer or a manufacturer-approved agency may use a new maintenance record without previous operating history, under 14 CFR 91.421. That's why listings distinguish SMOH from SNEW or SFRM.
Does the Lycoming 2,600-hour TBO apply to field-overhauled engines?
Not the 2,600-hour figure. Lycoming's SI 1009BF, issued July 2026, lists 2,600 hours for the first overhaul cycle of many factory-new or factory-rebuilt O-320, O-360, IO-360, IO-390, O-540 and IO-540 models. The same models show 2,000 hours after an overhaul. A separate 200-hour extension can apply to field overhauls that use only genuine Lycoming parts and approved procedures. Check the SI for your model.
Is a factory rebuilt engine worth the extra cost?
It depends on how long you'll keep the aircraft. On a cost-per-TBO-hour basis, a factory rebuilt Lycoming with a 2,600-hour first run can come close to a field overhaul despite the higher price. If you're selling soon, the appraisal lift usually won't cover the premium dollar for dollar. Run the cost ÷ TBO math with real quotes.
How do lenders value a fresh overhaul compared with a new engine?
Lenders rely on the appraisal. Appraisers adjust value for engine time and, often, engine pedigree, so a zero-time factory engine may appraise somewhat higher than a field overhaul with the same hours. The difference is rarely the full price gap. AOPA notes that aircraft lenders will generally add value for major engine overhauls, while paint and interior usually add none.
What warranty comes with an engine overhaul?
It varies by provider and changes over time, so compare written terms. Check the length in months and hours, whether labor and removal and reinstallation are covered, whether coverage is prorated, where warranty work must be done, and whether the warranty transfers to a buyer. A transferable factory warranty can help resale. A shop warranty that requires shipping the engine back may cost more to use.