doug@terak.UUCP (Doug Pardee) (01/10/85)
Golly, the net's been so quiet that I've had to wait a week for the for the opportunity to fire this volley... > Doug Pardee must own stock in Cessna or something. That's the only reason > I can think of that he is so much against freeing up the airspace for those > of us who think the Primary Aircraft proposal will make available cheaper > planes. The PA probably WON'T make available cheaper Cessnas, just more > competition. Easy, there. I am not, nor have I ever been, against the Primary Aircraft proposal. I support the proposal. I DON'T support the accompanying hype that it "will make available cheaper planes." That hype is "not in accordance with the facts." Let's ask some of the industry's leaders if they think that the Primary Aircraft proposal will bring about cheap airplanes... (quotes from January 1, 1983 issue of Aviation Consumer) From the General Aviation Manufacturers' Association, representing the "Establishment": "We really don't think the present Part 23 is that bad." Aviation Consumer reports that GAMA estimates "that certification adds no more than five percent to the cost of an airplane -- and probably less." And "...the current really rather basic requirements of Part 23 is not that big a deal, provided a decent engineering and test program is conducted." From Burt Rutan, as good a spokesman for the "New Wave" as any: "Part 23 is really just a minimum requirement. If you designed an airplane just to meet the present Part 23, it would be a very marginal airplane. The problem is not with the regulations; the problem is with the...FAA... Nobody wants to sign anything off... And the only way to solve that problem is to kill all the lawyers." From Richard B. Weeghman, Editor of Aviation Consumer magazine: "...in our book it's not nearly so much Part 23 that makes airplanes expensive as it is the archaic hand-crafting construction process, low production numbers, the infernally steep price of engines and high overhead -- all of which are naturally interrelated." OK. How much do YOU think that certification adds to the cost? 10%? 25%? Half again? Doubles the cost? Triples? Quadruples? Suppose we allow that it quadruples the cost -- that 75% of the price of a new plane is because of the certification. Suppose we allow that the Primary Aircraft proposal is SO potent that the certification cost would drop to zilch if adopted, giving a 75% price break. Does anyone out there think a better price break could happen? Then if we take a "180-mph plane that will sell for $15,000 if the Primary Aircraft proposal is adopted", and go ahead and certify it NOW under the current Part 23, then that plane would sell for about $60K, just HALF of what the competition sells for. Anyone who could build such a plane and sell it, profitably, for $60,000 would CLEAN UP! But I don't see anyone doing it. Since the quote above indicates that Burt Rutan has no question in his mind that his planes would pass the Part 23 certification, why doesn't HE certify them and sell them fully manufactured? If YOU could buy a fully assembled, certified, Vari-EZE with a warranty and everything for $60K, would you consider a Cessna 172 for the same price? Heck, there'd be no competition. The reason that Rutan Aircraft just designs planes, and doesn't build them, is probably that 1) Rutan likes to design, not manufacture, and 2) Rutan is no dummy -- he knows that there is no way that he could manufacture his planes at a price which would be competitive with "Wichita Spam Cans". Rutan's planes don't have any real cost- saving features EXCEPT that they can be built from a kit by a reasonably handy person. Compared with a Mooney 201, the Long-EZE is a tad slower, can't fly quite as high, can't carry nearly as much, is not as crash-worthy (not that the Mooney is any great shakes!), and is unsafe in instrument conditions. On the plus side, it is slicker-looking than the Mooney and gets almost twice the gas mileage. But if we're talking "Utility", the Mooney 201 wins hands down. I hear you hollering "But the Long-EZE would be a lot cheaper, dummy!". Wrong. Fully-assembled, it would be the same price as a Mooney 201! The following pricing analysis is in 1981 dollars, because it is based on figures provided in the August 1, 1981 issue of Aviation Consumer magazine in their interview with Rutan and review of the Long-EZE. (The analysis is my own, not Rutan's nor Aviation Consumer's). $100,000 List price, fully-assembled and equipped Long-EZE, 1981 -------- 15,000 15% discount to purchaser, actual sales price $85,000 + tax 10,000 10% dealer margin, wholesale price $75,000 10,000 10% manufacturer's liability insurance 20,000 20% factory overhead (rent, power, management, warranty, etc.) 5,000 5% income tax on factory profit 5,000 5% factory profit after tax 10,000 10% labor costs, 1250 hours at $8/hour 5,000 5% labor taxes and employee benefits (50% of labor costs) 7,000 7% "full house" of gyros, radios, etc. at OEM price 13,000 13% airframe parts, engine, propellor at OEM price Actually, the factory overhead would probably be higher than above, and the 5% profit margin is really way too low for any significant growth. This price analysis does match the rule of thumb for low-volume mfg. operations that the selling price ($85K) will be about four times the raw materials price ($20K). Anything that would change the pricing analysis for the Long-EZE would also do the same for the Mooney. It's not the design of the Long-EZE that makes it cheap right now, it's because it's sold as a kit. If it was possible for the home handyman to build a Mooney from a kit, you could buy such a kit for about $15,000. I repeat that what makes Rutan's planes so popular is that they CAN be built from a kit. The only ways to lower the price of factory-built planes are: 1) lower the materials and labor cost -- engine is the biggest chunk; 2) produce in high-volume, perhaps a million a year or so; 3) convince the Mafia it'd make a great front for laundering money. DeVore Aviation is working on developing a new low-cost 2-seat trainer, using method 1. They are developing a new, very small engine which they can get for less than the usual O-235. They hope to sell the plane factory-built for $20K. DeVore hopes to begin certification sometime this year, and by the way, DeVore is AGAINST the Primary Aircraft proposal. Doug Pardee -- Terak Corp. -- !{hao,ihnp4,decvax}!noao!terak!doug