Sunday, February 11, 2007

No funny no more...

An e-mail arrived lamenting the loss of humor on the blog.

Well Virginia, last summer it was easy to poke fun at the Eclipse program and its cast of characters.

They were a proud bunch, Vern on stage at Oshkosh surrounded by Washington dignitaries. Congratulation all around, handshakes, the press pleading for statements. Everyone associated with the project was busting their buttons with pride.

Vern's dream was just around the corner. His Minister of Propaganda was tossing out production numbers and delivery projections to the waiting faithful. Those 2,500 smart cookies could walk a little taller. They would soon be up there at 41,000 ft looking down at the unwashed masses.

Intoxicating times indeed!

The program was an easy blog target and fair game. Not a problem for Eclipse, they would soon prove the critics wrong.

Needless to say, today ain't last summer. Things aren't so funny anymore, especially to those directly affected.

Probably not so funny to the last investor group that came in coincident with the Provisional Type Certificate when the company was saying full certification was just days away and deliveries would total 100 by the end of the year, 525 by the end of 2007.

The new investor group earned a seat on the Board of Directors and must be asking some tough questions like how could the company fail so miserably in achieving its near term (30-150 days) business objectives.

Probably not so funny to fellow board member Brian Barents.

Had the Eclipse program clicked on schedule and started paying off like Vern had predicted, Brian might have been able to parlay the Eclipse success into his pet project, a supersonic business jet. Unfortunately for him, Eclipse cost overruns, technical difficulties and a billion dollar price tag for a little Part 23 sub-subsonic airplane might make it difficult to raise money for a SSBJ.

Probably not so funny for the Board of Directors as a whole.

The program is not doing so good under their stewardship. The current business model is not sustainable. There are huge costs associated with the development and re-certification work left on the airplane, start up costs to ramp up the production line, costs for the new service centers in Gainsville, Albany and Van Nuys, costs to upgrade however many "A" model airplanes that are delivered, costs here, costs there.

The expected revenues from delivering the first 100 units by the end of 2006 certainly don't exist. Revenues from delivery of the first 525 by the end of this year don't look so good either.

Plus by the time each airframe is delivered, the final payment will only amount to how much have we heard...30%?

If the company has collected the progress payments on first 200 units for delivery and if Eclipse runs out of cash, where will the next batch of money come from? The IPO or maybe Eclipse will try to tap the next block of 200 position holders for their 60% progress payment.

Extorting these progress payments from position holders is a new variation on the old Ponzi scheme. IMO, if any of these deposit holders lose money, they will be in a courtroom asking the board, "Where was the oversight?"

The other investors can't be to happy with the situation. I am quite sure they expected to be seeing some returns by now and they face the real possibility the wheels will come off this donkey cart and the original investors will be linked to the company's failure.

Back on the lack of humor, the situation today can't be much fun for Vern, he is carrying a ton of problems on his shoulders and things are getting worse, not better.

Our jokes at the expense of the employees are probably not welcome. I suspect many are working long hours and sacrificing weekends with their families trying to get the paperwork sorted out to support the PC. This is basic grunt work that could have and should have been worked during the last 24 month period. Then another large group desperately trying to squeeze the last little bit of performance out of the little jet in an attempt to meet the claims of management and marketing, while another group is pushing, pushing, pushing trying to get airplanes out the door, again to satisfy management's wild proclamations.

And those employees promised stock options that might propel them into the ranks of the near wealthy, they gotta wonder, will it ever...

The situation is probably not amusing to the vendors who were promised "too good to be true" production rates and dates that were attractive enough to bring them on board with great expectations.

It is not likely the position holders find much amusing today. The airplane is 6 or 7 years late, doesn't perform as advertised and their deposit is at risk as well.

Sorry Virginia, it's not funny anymore.

32 comments:

Stan Blankenship said...

The following was brought up from the last post for better visibility.

Nerdy Engineer said...
airtaximan said...

...what does "designing for high cycle air taxi operations" mean?

It means jack #$%@. It's a marketing ploy just like FSW, "revolutionary", etc. No one designs disposable airplanes, especially considering the scores of dirtbag lawyers just waiting to sue.

These premature failures are probably due to a combination of two factors: an inexperienced design team and, more importantly, management interference. Vern probably hired chief engineers who could do the best powerpoint presentations, not those who were the best designers. (Haven't they gone through several quality managers?) This was compounded by the fact that upper management planned fatigue testing so late in the program. No amount of computer simulation replaces real loads on a real airframe. Engineers make mistakes but with good management, both engineering mgmt and corporate, these failures would have been discovered earlier.

gadfly said...

But there must be a pony in here, somewhere!

gadfly

airtaximan said...

Stan,
"No funny no more" is quite humorous, and ironic at that.

I suggest, "No answers, no more".

We've come to a point where E-defenders are making less and less sense each post, or simply recanting their posts in stating they came from some unreliable source. Even Mount-VERNon has been uncharacteristically quiet. I doubt he learnt, just has no further excuses, for now.

Telling times.

I, for one deserve an apology. I stated my opinion that there looked to be around 75 position-holders seeking to off-load, and I was lambasted. All kinds of ridiculous analogies, made up facts and personal shots came at me. The e-defenders would not accept that there appeared to be 75 or so position-sellers out there. They claimed that it was impossible that there were more than around 30. Nice try… Some things make sense, some don’t.

A month later, Michael Press announced that there were 100 E-clips positions traded already. That means that many more than just 100 (not 75) folks were looking to jettison their E-positions. Perspective: this is half Cessna’s Mustang order-book, and around 20% of ALL of Vern’s non-air-taxi-book, by some reports.
The die-hard’s G_D set up an environment where selling positions in embraced, and they should admit that this is the case. People are selling. There is a discount sought for every plane being sold – they are being sold below $1.5 million by the very folks they defend as early adopters, folks who slept at the hotel for a week to get a position…real die-hards who only want the plane. Another bit of perspective…most of these positions were early ones, so the percentage may well be more like 80% of all individual early position-holders. Just an airtaximan’s hunch, here. BTW, your best die-hard-side-walk-sleeping-customers DO NOT WANT THEIR E-clips planes. They want to make $200k. WAKE UP.

The market for E-clips needs to be brought into some sense of sanity. People need to state that Vern is completely full of crap, promoted an auction, and enticed buyers to develop a fervent trading market for positions. It would be good for every position-holder, the press, and the industry.

Another thing. The IDEA that anyone would accept this plane as a for-revenue passenger plane is retarded. It’s already falling apart. There is no basis for the claim that it was designed for durability and high-utilization. It’s a joke. Without this claim and the air taxi market, Vern has no business case. The taxi market revolution is dead. Long live the revolution.

One last thing. There's an article in the February 26 Forbes magazine entitled DIM VISTA, by Stephen Manes which I believe everyone here should read.
http://members.forbes.com/forbes/2007/0226/050.html
You could almost do a find-and-replace with the words Vista and E-500 or Microsoft and Eclipse, and understand better what the hell is going on here with Vern’s company.

Vern's heritage is crystal clear. His lack of attention to product detail, marketing tactics, inflated performance claims, disrespect for the customer, put-it-out-there-and-fix-it-later attitude, and overall disregard for reality as far as what the customer wants, comes across loud and clear. The monopolistic attitude where the customer will just suck it up, explains a lot. Even the shady attempt top build a fence around previously invented technology is explained through this article.
It SCREAMS Eclipse.
It has one major historical difference.

Gates had IBM...
Vern has Dayjet...

IBM was a well established company with a lot of customers - they had the market. Gates at least understood the requirements and developed/licensed a product which served it’s purpose.

In E-slips’ case, Dayjet is a figment. Vern's sister-solution to a market they do not have, and never will. In fact, the idea for a taxi-plane was an afterthought, to try to find a market. The product was not designed for the market…if we are being true to history. BIG difference. Explains a lot.

EclipseBlogger said...

Cabbie said... I, for one, deserve a sincere apology. I stated my opinion that there looked to be around 75 position-holders seeking to off-load, and I was lambasted.

Apology? - not. It was a well deserved lambasting, from several bloggers. Stop giving your unsound opinions and give us facts. Your nonsense is tiring.

Cabbie said... A month later, Michael Press announced that there were 100 E-clips positions traded already.

And over what time period. Mike's been at this for quite a while. But regardless, those selling purchased low, and are selling high. A great capitalistic model. They placed their deposits down with minimal information. Remember that many of these original purchasers have been involved for almost 7 years now, in an aircraft that was supposed to have been delivered three years ago, and many are now in their 70's and finding that they are unable to get insurance. Now, when new customers are buying, they at least have a better idea of what they are getting into. No matter how many positions have sold, it's a testament that people believe in the product and are willing to pay the higher prices. Many of these new purchasers are not only putting up the initial and 60% progress payments, but they also have to pay the sellers premium in advance. Even when sold at a discount to the current list price, these buyers have much more on the line.

Cabbie said... Dayjet is a figment. Vern's sister-solution to a market they do not have, and never will.

For a market that you say will never will exist, there are many new companies cropping up that are making a go at it, and have business models that suggest that there is money to be made. They've surveyed the markets in their areas and have the clientele to support them. Pogo has announced that they will probably abandon the Adam deal and go with Eclipse. Several companies are starting out using Cirrus' for air taxi concepts to break into the market. Linear has been running a viable and expanding business using Caravans, and has 70 Eclipses on order.

You're just a cabbie, what the hell do you know? Again, apology? - I think not.

bill e. goat said...

It is entertaining to watch the Eclipse PR/Marketing machine in operation.
As much fun as it is to try to ferret out the truth from the Eclipse schedules, it is worth noting that the aircraft and system performance is, well, pretty close- nothing more time (ah, X months) and money (ah, XXX,XXX,XXX.XX dollars; amazingly, money doesn't seem to be a problem for this company- unworldly- maybe Bill Gates really is an alien) won't solve, eventually, probably.
The week-by-week and month-by-month (ah, and year-by-year) schedule scrutinization has been brought on by Eclipse themselves. But, I thought it might be interesting to compare other development programs. The schedule slips themselves might be put into perspective with comparisons to other (somewhat) recent biz jet certifications (mostly clean-sheet airplanes). From what I've dug up on the internet, I've listed a few aircraft with first flight and certification dates:

Raytheon/Hawker/Beechcraft/TBD:

Starship/2000
February 15, 1986 – June 14, 1988
(28 months)

Premier
December 22, 1998 – March 31, 2001
(27 months)

Horizon/4000
August 11, 2001 – December 23, 2004
(41 months)

Bombardier/Learjet;
Lear 23
October 7, 1963 – July 31, 1964
(10 months)

Lear 45
October 7, 1995 – September 22, 1997
(24 months)

Bd-100/Continental/Challenger 300/Whatever
August 14, 2001 – June 15, 2003
(22 months)

Sino-Swearingen
SJ-30-2
November 30, 2000 – October 27, 2005
(59 months)

Cessna
Fanjet 500/Citation 500/Model 500
September 15, 1969 – September 9, 1971
(24 months)

Citation X
December 21, 1993 – June 3, 1996
(29 months)

Mustang
April 23, 2005 – November 23, 2006
(19 months)
(initial cert was 2 months earlier,
this date is for flight into known ice)

Fun observations:
Premier first flight was on the 43rd anniversary of the Bonanza first flight.
Lear 45 first flight was on the 32nd anniversary of the Lear 23 first flight.
Head-to-head competitors Challenger 300 and Horizon 4000 had first flight 3 days apart.
Original Cessna jet was a model 500; original Eclipse jet is a model 500.

Worth noting: some of these airplanes had prototype flights several years earlier, which is not reflected in the dates above (SJ-30 was, like 10 years earlier or something, Eclipse prototype first flight was August 26, 2002).

All in all, Eclipse is doing pretty well by historical standards- some of the airplanes listed below are more complicated (FAR 25), but also developed by companies with more experience than Eclipse started out with.

The performance and system limitations that currently exist are annoying, but will eventually be resolved. And the delivery delays will eventually fade into history (if Eclipse themselves don't- ha! I think, not to worry).
The design and production questions will eventually be resolved. The REAL unknown, is demand. Will the air-taxi market succeed? If not, will corporate flight departments and fractional ownership perhaps kick in? Or third world/developing countries without a surface or air transportation networks create demand? Will global warming/ozone depletion concerns have an affect on sales?
The technical and production problems are, well, relatively old hat, every company has been through them. The great unknown is market demand. That is what will be really interesting to watch, over the years to come.

(Personally, I think the air taxi business in the USA won't materialize. On the otherhand, I think a LOT of companies currently without corporate aviation departments will buy into a small jet such as the Eclipse, potentially, maybe a couple of thousand sales in the USA. I can also see the developing countries demand being a big player, particularly India, South America, and China, maybe to the tune of another couple thousand jets. Opps- I forgot, 4000 airplanes so far- that just covers two years production (ha). Then what will Eclipse do in 2009 (or sooner)? I suspect, either work on a smaller jet, to go after the original owner-operator market, or a slightly larger model, to better suit corporate customers).

Gunner said...

EclipseBlogger said:
"Remember that many of these original purchasers have been involved for almost 7 years now, in an aircraft that was supposed to have been delivered three years ago, and many are now in their 70's and finding that they are unable to get insurance."

Good Christ, man, have you NO shame at all? That is simply the weakest, most absurd attempt at spin I've yet to hear ANYWHERE from Eclipse.

Your posts become increasingly more shrill and disconnected with each new Blog entry here.
Gunner

Ken Meyer said...

Stan wrote...
"The airplane is 6 or 7 years late,"


Huh? There was never supposed to be a delivery 6 or 7 years ago. The earliest this plane was ever supposed to be certified was June 30, 2004. It's in the earliest contracts; look it up. Like the simple facts from the AFM that you critics can't get straight, this one is in the documentation--how could you miss it?

In a way, the critics are helping Eclipse (albeit inadvertently) every time they write something that is this far off base. And that's happening a lot lately around here. You see, an unbiased reader knows that if the Eclipse Critics have to resort to saying stuff that clearly isn't true in order to knock the company, it must be because the company and the product aren't so bad afterall. It's funny, but actually, you guys are boosting the company when you say stuff against it that just isn't so :).

Ken

Kaptain Kool-Aid said...

In regards to the initial delivery date of the Eclipse 500, both Stan and Ken are wrong. My reference source is the Q&A article between Vern Raburn and AOPA in September 2000.

Vern’s answer to the fourth question posed: “...and will culminate in FAA certification in June 2003 followed by first customer delivery in August 2003.”

If you would like to “look it up”, Ken, here is the web address: http://www.aopa.org/pilot/features/
eclipse_qna.html

My favorite exchange from the article is regarding price at delivery...

Pilot: We were told the actual price will keep pace with inflation. So assuming that recent inflation trends continue, by the time the actual aircraft is built, it will cost about $1.7 million? Why announce artificially low prices now? Why not just wait?

Raburn: There's a big error in your arithmetic. The actual level of inflation from 1991 through Q2 2000 has been 2.75 percent per year. That means that if the current rate of inflation continues, our list price would be the following:

2003 $908,000
2004 $933,000
2005 $959,000
2006 $985,000
2007 $1,012,000
2008 $1,040,000
2009 $1,069,000

Using the 2.75 percent rate it will be 2026 before your suggested price of $1.7 million occurs. Even using the last 90-day inflation rate of 3.1 percent (U.S. Department of Labor Statistics, September 15, 2000, Report of CPI-U Change) your $1.7 million would not be reached before 2023! (Apparently, 2023 came a lot sooner than Vern expected!)

And here is Vern's take on why other companies have failed in the past...

Pilot: Have you studied other aircraft manufacturers to pinpoint what they may have done right or wrong?

Raburn: Extensively. The primary causes of failure fall into one of three categories.

1. Undercapitalization/unrealisticly low budgets: The vast majority of failures fall into this category. It seems that the standard response to how much capital will be required to develop a new airplane is $30 million. This is simply not possible. Although a simple single-engine piston aircraft could be certified for something approaching the $30 million figure, any new turbine aircraft is going
to require significantly more capital. (key word: significantly)

2. Poor execution: The development of a new aircraft requires extensive and competent management systems. Most new companies simply do not have either the management experience or management systems to handle a three- to five- year, multi-million dollar, million man-hour project. (Mr. Pot, have you met Mr. Kettle?)

3. Minimal product innovation: Developing a new aircraft that is only 4 to 5 percent better than existing aircraft is not a path to success. Given the long-term nature of aircraft (particularly GA aircraft), customers will not take large risks on a new aircraft from a new aircraft company to just go 4 to 5 percent faster or farther. This is the fundamental reason that Cessna (and Piper and Beech/Raytheon) continue to successfully sell 30- to 40-year-old designs. (Let’s give credit where credit it due – The Eclipse 500 is innovative. But will Eclipse be able to produce them in sufficient enough quantities – 500 or more per year – for the next twenty years and eventually turn a profit?)

Please read the entire article. It’s fascinating given the context of the ensuing six years since it was written.

EclipseBlogger said...

Gunner said... Good Christ, man, have you NO shame at all? That is simply the weakest, most absurd attempt at spin I've yet to hear ANYWHERE from Eclipse.

Obviously it's not from Eclipse - they would never admit to it. Point being, there are many reasons that someone would want to sell their position after six or seven years. In that time-span, one's needs, desires, and financial position can greatly change. But the real issue is that for every sale, there is a buyer. Mike Press' post just further dispels Cabbie's claim that depositors are trying to "dump" their positions. If 100 sold, then 100 bought.

Gunner said... Your posts become increasingly more shrill and disconnected with each new Blog entry here.

Glad to entertain you...

airtaximan said...

Ken:

you assertion that we arehelping Eclipse might be true, but not for the reason you bring up.

There is most often a basis for the opinions on this blog.

Some choose to follow Vern, and go with what he puts out. Usually relying on whichever recent "facts" he is promoting.

Others have notice a distinct pattern with Vern. Cover ups, blaming, diverting, not telling the truth, making things up, some pretty silly logic. These folks "remember" what has been said, or look it up.

Just becasue what is being written does not jive with what YOU remember or think, today, does not mean there is no basis.

Often, folks here will not just accept Vern, and try to tie things together, look for answers, inaccuracies, and things that just do not make sense. Others, just defend HIS position. Maybe, their own "positions".

In any case, we might be more helpful, if E-clips used the information on this site to their advantage. Learned from it. Understood that many folks do not like the sham that is being perpetrated on the industry.

Many companies react in a positive way to criticism and commentary. E-clips does not seem to be doing this. Unfortunately.

Jetman said...

I purchased an Eclipse position in August of 2000 and when they were willing to sell me another position at the same price in November of 05 if I rolled over for the price increase, increased my deposit to 155k for each and released the deposit, I weighed the risks and did it. In the Spring of 06 and before Oshkosh I started smelling a rat. I listened in on the "conference calls" and yet I was never quick enough to be able to ask a question and when all the questions were softball questions, I decided to sell my positions. I visited Independence, Kansas last week and flew a production Mustang (MLJ-medium light jet) 355 knots at FL340 with 5 men in excess of 170 pds. A real jet coming down a real production line. I opted for reality instead of fantasy and my Eclipse position premiums are helping me pay for it.
I had hoped to fly an Eclipse and transition into a bigger Jet if I needed more size or range. The delays, the unrealistic promises and the unlateral actions helped me decide to exit. I can only hope the implosion I'm betting will happen before Oshkosh 07 will not hurt the aviation industry.

gadfly said...

Thanks, "Jetman"!

You have helped clarify a debate between "Follow the money", or "Follow your nose" (ref: "In the Spring of 06 and before Oshkosh I started smelling a rat." and ". . . implosion . . . before Oshkosh 07").

A Google search of "Oshkosh '07" led to: "http://www.airventure.org/2007/news/061207_flyin_theater.html" with the following:

“A whole new generation of AirVenture visitors can now enjoy sharing those special memories of watching movies outside against a blackened summer sky,” said Vern Raburn, president and CEO of Eclipse Aviation. “Eclipse is proud to join Ford Motor Company as hosts of the Fly-In Theater at EAA AirVenture. After the successful debut of the attraction in 2006, we’re looking to make it better in 2007!”

which led me to: http://www.autoblog.com/2007/01/25/ford-burns-12-7-billion-in-2006/ which included: "Ford just announced its full year financial results for 2006, and the picture is really ugly. . . . For the full year it expended $12.7 billion more than it took in. Last year was one of the worst years in Ford's history . . ."

Maybe we should follow "both" our nose and the money. But we will need to hold judgement on this one until we see the presentation hosted by these strange bedfellows this coming July.

gadfly

airtaximan said...

EB,
together with your silly statement about age and circumstance as the reason for e-position-people selling, you rationalize as follows:

"But the real issue is that for every sale, there is a buyer. Mike Press' post just further dispels Cabbie's claim that depositors are trying to "dump" their positions. If 100 sold, then 100 bought."

Remember: Many transactions are at a discounted from today’s proposed selling price. These sales are by many folks you defend as “showed-up-at-the-hotel-because-they-dreamed-about-flying-e-clips–types”. They are in fact - arbitrageurs.

They want the money, not the plane. This is my only point. The "order book" appears to be comprised of a lot of folks speculating that they can make money with the E-clips, not flights. Alternatively, the plane as it exists is not what they bought. OK, you offer that they had an opportunity to get out of their positions… I’m not sure what they were told, what the media was, or the hype about the plane as it now exists. Certainly, today, there are a lot more problems with the plane than at the time of rescission. The plane is not what was sold, and not what was bought. A lot of selling is resulting. Luckily, there’s some room between the e-position price and the current published selling price by Vern. Arbitrage seems better than giving back a position, no? THEY STILL DECIDED THEY DO NOT WANT THE E-PRODUCTION-PLANE.

Otherwise, they would not sell.
Otherwise, they would demand a significant premium over the going rate for the plane because of the "advantageous" early delivery position scarcity.

This is not the case.

It feels more like "musical chairs", or "hot potato" at this point, as opposed to healthy order arbitrage and inflated prices for advantageous positions based on strong demand. Quite the opposite - discounts.

Reflect back on your defense of this active market a few months ago, when you were freaking out at the idea that there might be around 75 E-positions for sale. Your intuition, analysis, and overall conclusions, were just wrong.

Ask yourself one simple hard-to-stomach question: How many positions nee to be “for sale” in order to result in 100 already sold?

I think it’s more than 30. It might be more like 300 to have 100 already sold. Maybe 500, 1000 - who knows? It’s not 30… like you want everyone to believe. Also, it’s not because the initial buyers are older, either.

There’s a buyer for every seller is a convenient argument, except for the fact that there “appears” to be around 30 sellers on Controller today, the same number you put forth for your argument a few months ago….and there have already been 100 sales. When you said there were only 30 “for sale” there were 100 being SOLD. Perhaps these 30 sellers will result in another 100 sales? Interesting dynamic for an aviation order-book…3 times the SALES as the inventory “for sale”.

The same can of beans were sold a bunch of times at a profit too, until someone tried to eat them. Maybe this will happen here…there is certainly room left between what the positions were sold for, and what the going price is, today. I saw one ad for a guy who wanted $20k for his position… maybe a nice profit for a weeks work? Maybe Vern will increase the price again, and some folks will want to buy at “another discount”. I hope, for their sake, not.

Hot potato… Musical chairs… Certainly not normal buying and selling of aircraft delivery positions…not explained by there’s a buyer and a seller, either. In every bubble there’s a fabricated arbitrage market – sound familiar. WELCOME to Vern’s bidder’s club…

EclipseOwner387 said...

I think I bought one of Jet-man's jets.

airtaximan said...

EO387,

I think the markets heating up...E-blogger might want to buy your Jetman position, for a nice little profit...

EclipseOwner387 said...

ATMAN,

I had offers for over $100K more than what I paid for it shortly after I bought it. Decided to ride it out.

Anyway, do you really think approximately 100 trades in eclipse aftermarket is a lot? Do you even take into consideration how small that is as a percentage of orders? That this is a speculative situation? Especially when people like Jetman who probably only needs one jet but took on the second position to speculate on - which means no intention to take delivery. He held onto his original position for 6 years before finally getting frustrated and changing directions. I probably would have done the same thing if I was him. Frankly, I have only been involved in the Eclipse program for a year and a half and haven't lost my patience - yet.

Also, who ever claimed 30 sales? During that discussion it was the number of LISTINGS for sale at the time you brought up the discussion. Sold airplanes don't stay listed. Plus, the one I sold was never listed.

Should I be pissed that Jetman didn't disclose that he smelled a rat when he advertised it for sale? Doesn't that make him a rat? Thats what you guys tried to pin on me but you let him slide on by. I sold one but at least I am still invested in the program and sold only to make a profit. He admits to selling because he felt it was collapsing.

airtaximan said...

EO,

I think the 100 sales is a lot.
I do not believe Vern has 2400 or so orders. I have paperwork that made that claim in 2002, as well.

I've read that there are around 600 orders from individuals, the rest are fleet orders and "options".

The ones trading are one's with deposits, not flim-flam fleet-puff orders and not options. So, yeah...

100 trades is a lot, especially while there appears to be many still seeking to sell.

Lastly your clarification:
"it was the number of LISTINGS for sale at the time you brought up the discussion. Sold airplanes don't stay listed. Plus, the one I sold was never listed."

precisely my point - I said it seems like a lot of Eclipse's are for sale. Somone else tried to use the Controller listings (sifted through them to weed out already-solds and double entries) to try to make his point that there were NOT a lot for sale.

I thik the listings indicate that there are a lot of sellers, not a pure number based only on that one source.

I think 100 e-positions changing hands is a lot. I can also see your point, that if you believe Vern, and there are thousands of positions already sold, it may not be that many.

I am not a believer i the order-book. See Nimbus circa 2002 for order-crook credibility.

http://www.ainonline.com/issues/07_02/07_02_willnimbuspg6.html

Ken Meyer said...

Airtaximan wrote,
Michael Press announced that there were 100 E-clips positions traded already. That means that many more than just 100 (not 75) folks were looking to jettison their E-positions."


Let's make sure we're all on the same page--What exactly did Mike Press announce? His website says that he's been involved in 50 sales.

Ken

EclipseOwner387 said...

ATMAN,

When I first put down my deposit directly with Eclipse I was told they had a 2400 order book. I was given a mid 1400's S/N. I asked how could that be if 2400 orders already. They claimed it was fleet options that were set either for later delivery or TBD. At the time I figured it was a stretch. My opinion is that their are over 1000 real orders. I think 600 is low. But even 100 of 600 is only 16.7% turnover. And I personally account for 3 of the transactions. I think your view of a lot is skewed. My guess is the percentage is even higher than that but not abnormal in regards to turnover. It would be interesting to know how many earlier depositers looked at this a pure spec play.

airtaximan said...

Ken:
You might be right, I'll look...I was not the one who posted that there were 100 sales already, someone else posted it here. I noticed it, and remembered my post regarding thinkning there were a lot of positions for sale.

FYI: I found Mike Press' recent report, which concludes:

"Conclusions and Forecast

The Eclipse secondary market has been very weak in December and January. Like the housing market, the Eclipse secondary market went into hibernation the last two months. Currently it is a buyers market with plenty of sellers and few buyers. Prices have come down and are now selling BELOW factory price at a discount. While this is very good for the buyers, it is still not that bad for the sellers. As most sellers got into their positions fairly early at a very low list price, their profits in this market decline are still reasonable. This is why some sellers can sell at $100,000 BELOW factory price and still make a nice profit."

Which if ture (I have no way of knowing how credible he is) seems like an accurate depiction of the market and prices. Also, it seems to indicate that most of the 100 (if true) refered to sales occured prior to December...

a little tidbit for EO who seems to think timing has something to do with mitigating the interest in getting out of e-positions...

gadfly said...

Somewhat directed toward EO387:

Yes, there is responsibility on both sides:

Caveat venditor ("Let the seller beware") and Caveat emptor ("Let the buyer beware").

Most often, neither seller nor buyer has enough information to follow such lofty advice.

And "neither" will be willing to follow the advice of a wise "dis-interested third party". So, most transactions are based on emotions. Salesmen are the "buffer" between the knowledgeable and the gullible, often taking the position as that "pseudo" third party.

Follow that advice closely, and you will have missed the joys and sorrows of being an entrepreneur . . . and may die a rich lonely old man. Personally, if I could swap the money I have made, with the money I have lost . . . the balance would be a hard call. But either way, I wouldn’t trade the experience for anything. And just now it gets down to serious things like “ego” . . . and I’m not casting asparagus on anyone. OK?

If you’re trying to “get back” that first “white-knuckle-first-solo-landing-experience” in a Cessna that you’re sure will never, ever get to the ground (with forty degrees flaps and a grass strip the size of a tennis court on a hot day in July) . . . being witnessed by the other eleven students in your “bush pilot class” waiting for you to flare out about ten feet off the ground . . . by buying a plane that is supposed to go 370 knots with four or five passengers and baggage, forget it. Sure, you told the wife, it’s goin’ to make a “profit”, taking folks on taxi-rides cross country (not just from the terminal to the end of the runway between the blue lights). You pay your money, you take your chance, and hope that what you know in your gut is wrong . . . and you get on with life. And go back to see if you can afford a “dinosaur” from old companies that have no imagination, just in case that guy doesn’t show up this year at “Oshkosh”. Hey, maybe pigs “will” fly . . . who knows! (This “prophet” is batting about 500 . . . OK, say 400? . . . alright, a solid 350! . . . I’m a little troubled that prophets in Bible times were to be stoned if they failed the “100%” test.)

For crying out loud, there’s got to be a little humor in this blogsite now and then. It’s all going to go up in smoke, eventually (everything) . . .On the best Authority!

OK, carry on! When some of you begin rearranging the deck furniture, I must reply, “I haven’t laughed so hard since the hogs ate my little brother.” (quoting my grandmother, a gentle soul, how I miss her. . . Ha! . . . she always took the train.)

Gadfly

“Just watching and being entertained from a distance.”

gadfly said...

As I click a wine glass to get your attention, I think it time to recognize our “host” at this website party. Stan Blankenship has been most gracious to allow us to come together, to express our opinions, both “for” and “against” . . . even “neutral” opinions of a company that has claimed to make major changes in the aviation industry, aka, “Eclipse Aviation”.

Some of us have interest in the aviation industry “as a whole”, and others have a financial stake in the outcome of Eclipse Aviation.

Regardless of our position, all of us are guests at this party. We should not forget that fact. We should limit our “indulgence” and not become too inebriated to leave the party to make our way safely home.

It’s easy to become uninhibited at a party, and express our views in a way that is no complement to others, who are also “guests”, and are not complementary to our host.

As a guest who came lately to the party, I am most grateful that I have been allowed to attend . . . even though not on the “guest list” (I am neither a purchaser, nor a supplier of “Eclipse”). In my chosen trade, I am a “knuckle buster”, a machinist, who goes home at night with the smell of “cutting oil” and “dirty fingernails” . . . and metal chips firmly imbedded in the soles of my shoes. But I am also a third generation inventor, and have had a direct impact on EVERYONE who reads this “blog” . . . guaranteed, 100%.

Why am I, then, even interested in this “party”?

As someone who has spent a lifetime involved in one way or another with aviation as the son of an inventor of things that keep “all of you” safe as you fly from point “A” to “B”, and a pilot, myself, and a licensed “A&P” mechanic, and an inventor, designer, machinist, with a family history of involvement of direct impact on the lives of every one of you, who have ever flown in anything “Douglas”, “Lockheed”, “Boeing”, “Sikorsky”, “Hiller”, . . . and a few other interesting things (even if you require vascular surgery . . . but that’s another story . . . we can go there another day), and manufacturing in Albuquerque, . . . well, let’s stop the list right there because it’s getting to be too long for this “blog” . . . I care deeply that anything produced in the name of aviation should be of the highest quality and integrity. Our own reputation is more than secure . . . in that regard, I could not care less. But this “recent” attempt to change the face of aviation has me more than a little concerned.

Until then, we all need to understand that Stan Blankenship (whom I have not yet had the privilege of meeting face-to-face) has provided all of us with a welcome forum to express our views, whether frustrations or exultation, over a new “yet to be proved” aircraft. Unfortunately, the fortunes of many folks ride on the success or failure of this “new” (if it be “new”) concept in aviation.

Let us both thank Stan for his hospitality, and be mindful of the words, so easily “typed”, that may help or harm all who are “guests” at Stan’s party.

gadfly

airtaximan said...

Gadfly,
you wrote:
"...We should limit our “indulgence” and not become too inebriated to leave the party to make our way safely home."

Careful. Seems like you might be getting pulled over sometime soon, and the cops will be asking you to type a straight line before they confiscate the keys to your keyboard, there buddy.

gadfly said...

"KM"

'Not sure about this one, but should you wish to contact me directly, I think that you can do it by clicking directly on my "pseudonym", gadfly, and say anything you wish . . . and I'll gladly direct you to our facility, and discuss any subjet of your choosing . . . even take you to an excellent lunch, "prime rib" . . . whatever, with the guarantee that we will leave our visit as "friends". It is not my desire to hurt this project . . . far be it, but to help anyone bring this, or any other project to success, should it be what it claims to be.

All of us who use "pseudonyms" are just a little bit "paradoid" about the "spammers", who exploit us daily with literally scores, even "hundreds" of attempts of getting into our system. This is not an attempt to remain anonymous to genuine dialog, but the practical measures that we must use to protect ourselves from a world of "bad people", who are liers and up to "no good".

Please be a little bit understanding of the many "bloggers" who want desperately to share their ideas, but must at the same time make some attempt to protect their privacy . . . this goes far beyond Eclipse!

We have nothing to gain, or lose (directly) with "Eclipse", but enjoy success, wherever it may be found . . . anyone proceding towards an honest goal.

It is no easy thing to succeed with a new idea . . . how much we understand the problems involved in bringing new ideas into existence!

Although we (my son and I) have nothing to contribute financially, we never-the-less can and will support genuine advances in technology, verbally and in the written word.

gadfly

gadfly said...

airtaximan

Yeh, the "illusion" got your attention . . . and that was the purpose. But, sorry! Except for my submarine buddies of long, long ago, I do not relate. Coming back late at night at "Pearl" or "Yokosuka", or "getting under way" during a storm in a "sugar plantation harbor" on Kuai, while I was assigned (reluctantly) "Shore Patrol", and our crew was "three sheets to the wind", our submarine made it safely out to sea . . . and I am not in the category of those who need to worry about DUI. Not a pretty sight.

"Diesel boats forever!" . . . ah, memories!

But thanks for your alert reading.

Gadfly

airtaximan said...

Gadfly,

I have you in my prayers.

gadfly said...

airtaximan

Yes, I read you loud and clear.

Thank you.

gadfly . . . think of "scooters" "as in the "Eagle", small utility vehicles that used to be seen at airports, golf carts, engines, and a company that used to be in Lincoln, Nebraska, until 2002 . . . although not then owned by "this family", you'll figure out where the name originated.

Bottome line, I like American innovation to succeed, when it's legitamate.

Niner Zulu said...

With regard to the number of Eclipses that have changed hands so far....it does seem that Mike Press has the best handle on what is going on in the resale market. Yes, he has a vested interest in Eclipse and makes a profit where he can - I don't have a problem with that - and if he says that 100 have changed hands then I am inclined to believe his number. My problem with him is that perhaps he is a little too enthusiastic about Eclipse's future prospects. I hope, for his sake, he is right.

If I may offer my take --- I was interested in purchasing an Eclipse position until as late as last November. After doing some homework, visiting the factory, putting out some feelers and talking to other Eclipse position holders, I decided to pass on purchasing a position.

What I discovered in doing my homework is that there are 1) a lot of Eclipse position holders who would really like to dump their position, but just haven't gotten around to it for one reason or another, 2) more than a few position holders that are just plain clueless about Eclipse and have more money than sense, and 3) there are a lot of wait-and-see'ers who just aren't motivated to do anything at this point because they haven't been asked to put up more money yet. How many of these people are future sellers remain to be seen, but my guess is that there are a lot more out there that may sell before they take delivery and it just wouldn't take that much to start a stampede in the resale market.

I didn't need to find this blog to realize that I was being fed a lot of BS by the Eclipse factory reps and that anything they said was questionable if not downright false. My final assessment was that I don't need to save a million bucks so bad that I am willing to risk a million to buy an unproven product from an unproven company. Eclipse has proven again and again that they are full of hot air - it's all about hype and marketing. Seriously - has anyone ever seen any airplane manufacturer advertise more than Eclipse? Their ads are everywhere and one has to wonder why. I mean, what is it they are selling - position number 3000 for delivery in 2020? Anyway, the risk of losing everything in the event that the speculators head for the exits was, for me at least, too great.

There are too many products coming on line soon from real companies like Embraer, Diamond, Cessna, Piper, Honda, and Cirrus to seriously consider the Eclipse.

So why am I still interested in this blog if I'm not interested in an Eclipse? Well, my wife wonders the same thing but the short answer is that you guys provide me with regular laughs, good heated debate over a topic I love (aviation) and good information about the other VLJ's as well, one of which I will end up owning in the near future.

Gunner said...

niner zulu-
Hats off to you, guy. I actually stepped up with a deposit before I started paying real attention.

It took me 3 days to realize that the company fosters a cult-like relationship with its "customers". The lies, excuses and "corrections" begin immediately upon "joining" and quickly spiral from there. It's really pretty amazing how Vern keeps so many deposit holders in line. Seriously, who else could get away with claiming "no big deal" when the entire in-shop fleet has been found to have faulty wing spar attachments and windshields/windows that crack every few hours? And still have a chorus raise their voices in adulation of what you've "created".

Anyway, I came, I drank, I got ill, I got out.

What amazes me, though, is bright guys, savvy entrepreneurs and successful businessmen listening to the tales from ABQ weekly and STILL publicly defending them as believable.

In the end, even if you can make a hundred grand or a half mil (directly at the expense of someone else) by selling your position, you've done so at the expense of your credibility and your integrity: internet anonymity be damned.

Things have changed much in six months and one would have to be near blind (or desperate) to pretend that everything's gonna be just peachy as soon as we work out a few wrinkles like cracking windows, unsafe wing spar attachments, avionics that are still on the drawing board, flight training barely past the rumor stage, operating envelopes that look like they were drawn by Pac-Man, a year that would see 500 aircraft delivered with not one out the door as we head toward Month Three, an FAA that will NOT be left holding the ball, and performance that is measured in new terms like "air miles".
Gunner

EclipseOwner387 said...


Gunner said,

In the end, even if you can make a hundred grand or a half mil (directly at the expense of someone else) by selling your position, you've done so at the expense of your credibility and your integrity: internet anonymity be damned.



I knew Gunner would take the bait. Do you think I was serious about being upset with Jetman for shamelessly selling me his position? Would you fault him for selling a stock of a company he thinks might be going down - isn't that common practice? Using your way of thinking we should ride the stock to its end - or lose integrity and credibility. We are not buying or selling a house to grandma dude. This is a RISKY proposition. BUYER BEWARE. You sound like a business idiot with comments like that. But with your credentials you can't be an idiot. So you write this stuff for purely negative intentions to inflame or cause harm to respectable people. It is not rational thinking. It is up to the buyer to do their homework - an MBA grad from Wharton should know that. They are trying to buy at a discount and AT an earlier delivery position than they can get from Eclipse so they RISK it. They have a DIFFERENT opinion than you. Oh wait a second - they had the EXACT same opinion as you! But now the mighty Gunner has found the light and is here to damn those who don't believe as him. Give me a break. Please. And why are you here? You have no position in Eclipse. You are not in the business of jet manufacturing. Are you just a good samaritan trying to save the poor souls who have crossed over or soon may without your brilliant insghts? No, it isn't anything pure at all. You are just simply trying to get revenge for how "poorly" you were treated at Eclipse. The same guy who pickets the laundry mat for losing his tux shirt even though they reimbursed him his money. He has better things to do for sure (or maybe not.) He has principles to stand on!

And by the way - your comments are way more shrill that EB's. Especially for someone who really has no reason to be here. But thank you for the entertainment. You are a classic basher and it helps the lurkers see right through your intentions.

Gunner said...

Whoah there' EO. You need to jump back just a little. If you felt I was referring to you, that's your cross to bear. I posted, this very morning, the following:
In fairness, I don't think too many of the position holders are speculators. Sure, they may have looked at selling their position as one possible exit strategy, but for the most part, I think they started out as future owners. Look at EO387, for instance.

No, I don't have a problem with the fact that you sold your positions; Eclipse was a risky, yet viable business at the time. My problem is with people buying on spec GOING FORWARD, as the facts come out and the viability goes to zero. That's called a Ponzi Scheme.

As to my credentials, motives, the alternative aircraft I'm looking at or the amount of skin I have in the game, I'd most certainly justify those to you if your opinion of me mattered. It does not....not even a little.

Dunno what set you off this AM, but I suggest you go back to bed and get up on the other side. ;-)
Gunner

EclipseOwner387 said...

Gunner,

Ok.. You made me laugh.