Wednesday, October 04, 2006

We Did It!!!

Well, that's what I was expecting. Instead, the Eclipse press release was uncharacteristically humble.

“In spite of the hurdles we’ve encountered and those that still lie ahead, this is a day to reflect on what has been accomplished,” said Vern Raburn, president and CEO of Eclipse Aviation. “We successfully launched a new aviation company, developed and certified a truly revolutionary aircraft and created a whole new market segment that helped return relevancy and growth to general aviation.”

No claim as to how they would ramp production up to 1,000 units per year.

No claim as to building an airplane whose operating costs would compete with airline fares.

No claim for meeting or exceeding the original design goals.


Next event - The National Business Aircraft Association convention starting October 17th. All the aviation press will be there...I hope they ask some tough questions.






10 comments:

Niner Zulu said...

Stan,
I happened to be in ABQ last Friday & showed up at the factory doorstep on the first day of the weekend-long event at which they announced the receiving of their type certificate. After a somewhat rocky beginning (as in RUDELY being turned away at the door), we were given an unexpected and very cordial tour of the factory, and witnessed the Eclipse picking up deposit holders on the ramp and taking them for test flights. My impression was – WOW – what an operation! I have toured both the Piper and Beech factories, and I was more impressed by what I saw at Eclipse. Clean, modern, high tech, and an enthusiastic staff. The person who showed us the factory was very knowledgeable and able to answer ALL of our questions regarding flight characteristics, fuel burn, problems they had in development with the tip tanks, with Avidyne, etc. I don't mean to sound like another cheerleader for Eclipse - they have plenty of those - but I have to give credit where credit is due. As far as the IPO goes, my guess is that a large infusion of investor capital is just what Eclipse needs so they can continue to operate until they can turn a profit. I’d do the same if I were them. And as for the over-marketing goes, I wish I had their flare for marketing. They’ve done a great job. If Vern seems a little over-enthusiastic, all I can say is - go visit ABQ airport and see how visible the factory is (you CAN’T miss their buildings) and imagine how enthusiastic you’d be if this were your baby. C’mon – cut him a little slack fellas! My main concerns are: 1. the over-marketing of the Eclipse in every publication except Woman’s Day has attracted a lot of would-be jet pilots. I think Eclipse recognizes this, though, and rather than see a lot of their aircraft end up as lawn darts they have designed a training program to weed out the inept pilots from the capable ones. If pilots can’t pass the Eclipse course after 2 tries, they can’t fly the plane themselves. I’m not sure of all the details about this, but I know it involves hiring a pilot. 2. I just don’t think that the Day Jet concept is going to work (…but I have been known to be wrong). To most people, small planes are SCARY. Some people are going to show up for their flight, see the small size of the cabin and no bathroom, and say “no way”. I hope the future success of Eclipse does not rely on this business! If it were a viable concept, it would already be in existence as there have always been very capable aircraft for this type of business – the King Air, Pilatus, Twin Commander, etc. Anyway, I’ve got to run, but in closing would say I’ve seen enough to be convinced that I would like to own one of these. It is what it is – a SMALL jet – but it’s new, inexpensive, very high tech, and looks like it will be a ton of fun to own and fly. More later……

N01SY said...

I am wanting to contact Stan Blankenship by email or phone. I am new to bloging so I don't know if it is allowable to ask for contact information or to post mine in this forum. I am needing someone who can help me with the structual analysis of adding weight to the engine mount on a 20 series Learjet aircraft and it sounds as if Stan may have the background.

Stan Blankenship said...

niner zulu,

Been there and seen it a couple of years ago. Your impressions mirror mine. They have the makings of a great operation if they can only figure out a way to turn a profit. Keep in mind, what you seen was a lot of overhead.

The problem from my point of view is that too much of the promotional information has been very misleading and hence, the blog.

I do find it interesting that more and more people like yourself have doubts as to the viability of the DayJet program.

Stan Blankenship said...

n01sy,

You can call me at 316-832-9888.

Am not sure I can help you though, it has been 40+ years since I worked in Lear's engineering department.

Spirit Wing in Guthrie, OK is working on a project to re-engine the Model 25's. Avcon in Newton, KS has a lot experience in getting STC's for mods to Learjets.

SRMach5 said...

First of all, echoing what niner zulu said, you must give credit where it is due. I am glad to hear they have such modern facility and to hear enthusiasm from the people of ABQ and the Eclipse employees.

The proof though folks is not in certifying the aircraft, it is producing it reliably, efficiently, and most importantly safely for each of the units to be cranked out the door. I believe as I have pointed out in the past, I don't buy the business model under which they are operating.

I understand Vern's dot.com thinking and wanting to be a cowboy, but let's face it folks, you can't change physics and you can't run a business on smoke and mirrors. It takes cash!

I agree somewhat with niner zulu on the 'Dayjet' issue. I agree that the Eclipse is NOT the right airframe for this business venture to be successful. I have spent time analyzing the Dayjet model and what they have done is create a logistics model which has never been utilized before in aviaton. With the proper airframe, I believe there COULD (and I must emphasize COULD) be a viable business model Dayjet has uncovered. Time will tell.

Back to the insurance issue for a moment. I spoke to a high placed source in the insurance community recently where he told me emphatically they will NOT underwrite the Eclipse.

The training in their opinion is suspect at best, but more importantly they don't have much confidence in the design and building techniques being utilized.

I am sure there are Eclipse employees who monitor this website on a daily basis as 'required reading'. I wonder which underwriters they will be calling first after they see this post?

Bambazonke said...

All the above being taken into account, Vern cannot get out of his own way, and he is creating a problem that is bigger than the check book behind him..

By the time these wonder pilots realize there is more to flying a jet than their egos told them, they are going to be married to a pilot in an airframe that is the size of a shoe box. How long will this little honeymoon last? My guess is with the kind of ego that wanted to fly a jet - not long.

In the meantime Vern will have been pumping these little sausages out of the factory like it was Octoberfest, at the same time there many Ego Jet Pilot will be out there tired of whining Peter Pilot who needs to be nurse maided every time they step on to the ground.

Co-incidental with this time frame you will have the other speculators like the Swiss boyz who came to make their fortune on Vern's backers back, and they will be dumping the little sausages on the market at whatever price the market will bear, why? becuase there will be big fat checks that need to be written for their 60% deposits. We all know that the planes bought in the name of fractional programs were really spec programs, and heck with 500k or more being made on each early position, they can make more on selling the positions than they can ever expect to make running Joe Public between Bakersfield and Fresno.

So we have these two colliding forces, Ego Jet Pilot selling his position, and Sven Speculator dumping his positions, who is going to win this fight? Well Ego Jet Pilot has the resources to dump his plane at any price, lick his wounds and ride onto another venture at the next OK Corall, not so with the Day Operations, they will run out of backers and Vern will at last make some money cashing in the deposits, oh but wait, that money is already spent, and P&W have been calling about some engine money... "Tell the investers we will sell the planes on the retail market" Vern will shout. The marketing department wil be reporting that Ego Jet Pilot just let his plane go for $800k, that was the best bid he could get because there were 2000 of them for sale..

This happening will eviscerate the check books of the happy clappy dot com kids, and leave them with a headache that no amount of Kool Aid will douse.

Vern, this is your own doing, your big mouth and stupid order taking that you were so hell bent on taking to boost your silly little ego is going to lead to the demise of your dream.

You had a great idea, you just did not know when to stop bullshitting yourself and those around you. Put your fingers in your ears because this is going to be a big bang.

Over and Out!

Eclipse Insider said...

You couldn’t be more wrong about how DayJet’s success will make or break Eclipse. I sat through a presentation given by Vern and DayJet at a supplier conference and both said that the long term success of Eclipse is tied directly to the success of the air taxi business. DayJet is a direct partner with Eclipse and a significant part of their backlog. You shouldn’t underestimate their importance to the big picture. If DayJet fails, Eclipse will take a significant hit.

Fritz said...

Good Luck to Eclipse. I hope your profits soar and your business is a great success. I raise my glass to the notion of flying on a microjet.Hallelujah

The Contra Crunchy said...

You know what the wonderful thing about all this is? Maybe Vern gets it to work, maybe he doesn't; heads I (as a member of the general flying public) win, tails, I lose nothing. Unlike Airbus or Boeing this isn't being underwritten by the gov't, all the buyers and investors are high-net-worth individuals fully capable of telling their head from their ass.

The reason I am rooting for Eclipse, Cirrus, Avidyne et. al. is that they are the main reasons driving GA forward right now. Cessna and Beech were quite happy to keep cranking out the SOS they were in 1981. Hey, I own a C172, and it is a great plane, but you can't tell me this is really the best we can do knowing what we know today.

Twenty years ago the homebuilders were a bunch of reckless cowboys, hell, a lot of them still are, but they're the reason Alan Klapmeier decided to take a chance building a modern GA plane. Is the G1000 a better system than the Entegra? Yes! It's also a lot newer in design. Avidyne is the reason why we have a glass cockpit in new 172s. Cirrus is the reason Cessna is talking about a new 4-seat airframe after over *fifty years* of 170/180-derived planes. Eclipse is the reason Cessna built the Mustang.

Every next-generation product/technology is developed over the objection of God knows how many thousands of engineers and experts who say "but you can't do that!" Along the way they're often right in key places and plenty of fortunes are lost in the process. But if the market is there, eventually somebody cracks the code.

The early railroads lost money more often than not. It took four tries and more than fifteen years to lay a transatlantic telegraph cable that lasted long enough to be useful. Imagine a 3,000-mile underwater cable with the technology we had around the civil war--wow! I'm sure there were no shortage of skeptical experts to explain why it would never work.

Stan, sometime I'd like to see you describe what you would do if you had access to Eclipse's finances. I'm not saying these guys aren't making mistakes but I respect that they are trying to build something new. There are plenty of rich guys out there content to put their money in hedge funds and take it easy.

Stan Blankenship said...

The above comments are especially informative and I hope they get read by all who are interested in the Eclipse program.

crunchy asked the question what I would do different?

First, the Quest business model described in the next post reflects my view of a good model for a new aircraft company.

From day-one, Vern said Eclipse would be a billion dollar a year company and has structured it accordingly...1,000 airplanes per year, a million dollars per copy.

After the demise of the Williams engine, had Eclipse selected the 1,350 lb Pratt engine, put a bigger wing on the airplane and provide some real jet performance, they would have something to sell.

We will soon know what Cirrus has in mind. If their design has performance that approaches what Eclipse has to offer, and at a much lower cost, it will be strong competition for those owner-pilots (as profiled on the Eclipse web site) who want a jet for the 500-600 mile trips.

With the higher fuel prices and higher Eclipse operating costs, there are fewer and fewer people trying to make a case for DayJet and other charter operators who wanted to compete with costs comparable to full fare airline rates.

One begins to wonder what market segment will be left for Eclipse to target?