BeechTalk - BT

Username Protected · **Posted:** 22 Sep 2013, 13:43

Username Protected wrote:

Interesting discussion.

Once a product line reaches "end of life" as far as the manufacturer is concerned, you would think that there would be significant monetization of intellectual and real property by selling specs, drawings, tooling and jigs. Take the money and run, and let someone else deal with it.

But lets say Brand XYZ doesn't seem interested in selling airplanes, and they've got to know even if they did, they'll never capture any significant part of the market at $500k a copy. They've got legacy models that people and businesses would line up around the block to purchase new, but they have no interest in making them, nor are they interested in selling the IP to allow others to build or support them.

It's as if they want to simply wave a magic wand, write off ALL of the assets, and make those products disappear, despite the significant real value.

If I was a guy want that wanted to make that happen, I would:

1) Jack the prices on parts and support up so as to eliminate as many units in the fleet as possible.

2) By providing parts (despite the price and long lead time), I demonstrate to the FAA that the units are still "supported", thus reducing the possibility that the FAA would be lenient on 3rd party PMA efforts.

3) Allow the units in the field to attrit due to simple economics. When the numbers get low enough, issue a "killer" AD and just park them all.

Whenever something weird like this trumps "making money", its either politics or "legal" reasoning behind it. Accountants and a lawyers making the calls, not engineers or airplane builders.

Best,
Rich

Why do you think I used the analogies I used in my post.... :grr:

Username Protected · **Posted:** 22 Sep 2013, 13:47

Username Protected wrote:

even if they outlaw planes in the U.S.
there are enough cessna 172s and 180 series cessnas in the rest of the world to keep people like me going for 20 years
Kevin

I am not like that. I want my grandchildren to still be able to enjoy flying and private aircraft ownership. With this thinking, the only thing you have left for them (if they ever wake up from their methylphenidate haze) is stories.

Username Protected · **Posted:** 22 Sep 2013, 14:21

Is this a good time to bring up "owner-produced" parts again?

I see a business proposition here.

1. Set up a company that reverse-engineers OEM parts, and produces detailed drawings/process specifications. Call it company A.
2. Set up another, completely independent company that is equipped to make parts based on whatever drawings/specifications the owner supplies. Call it company B.
3. Company A sells drawings/specifications to the owners in need of a part.
4. Owners go to company B (or other shop of their choice) and have them manufacture the parts according to the drawings/specs.

Voilà, we have an owner-produced part that is perfectly legal to install.

Makes sense?

Username Protected · **Posted:** 22 Sep 2013, 14:28

Username Protected wrote:

Why do you think I used the analogies I used in my post.... :grr:

If that really is the "end game", why not simply go out and make a cash offer on the extant fleet? Plenty of precedent, even if not to the same scale.

Surely some bean counter has done the calculus on this. Even a relatively low ball number would eliminate a significant fraction of the fleet, especially if you let the owner keep the avionics. "Here, this is an offer for $xxx, we want to chop up your airplane".

Best,
Rich

Username Protected · **Posted:** 22 Sep 2013, 14:55

Username Protected wrote:

Is this a good time to bring up "owner-produced" parts again?

I see a business proposition here.

1. Set up a company that reverse-engineers OEM parts, and produces detailed drawings/process specifications. Call it company A.
2. Set up another, completely independent company that is equipped to make parts based on whatever drawings/specifications the owner supplies. Call it company B.
3. Company A sells drawings/specifications to the owners in need of a part.
4. Owners go to company B (or other shop of their choice) and have them manufacture the parts according to the drawings/specs.

Voilà, we have an owner-produced part that is perfectly legal to install.

Makes sense?

Yuri,

Does "owner-produced part" mean:

(a) owner hires a company to produce the part...

-- or --

(b) owner actually produces the part?

Username Protected · **Posted:** 22 Sep 2013, 15:21

Username Protected wrote:

John Frank, owner of the Cessna Pilots Assn, had an article this month about Cessna Parts. Basically says what we see above. Previous cultural commitment to making legacy airplane maintainable in a timely, affordable fashion has gone. Every part now basically needs a viable business case. The $17K landing gear part isn't a joke. Parts are increasingly non available or can be ordered with a 80 week leadtime, etc.

An A36 might end up being a better deal than a 182RG. There are a lot more Bonanza airframes out there to support than 182RG's.

Maybe better if Cessna will just totally abandon the legacy airframes and sell the business to someone who is interested.

Charles,

Here is the counter. If a particular model does not generate sufficient parts business to support itself, why should it take down the rest of the company?
If we want Cessna to be around to support the majority of the legacy fleet and still produce new aircraft, then new aircraft sales and legacy planes like the 172 cannot be expected to support the 182RG.

Tim

Username Protected · **Posted:** 22 Sep 2013, 15:45

Username Protected wrote:

Yuri,

Does "owner-produced part" mean:

(a) owner hires a company to produce the part...

-- or --

(b) owner actually produces the part?

Short version is that both (a) and (b) are OK, but if you do (a), you have to supply the manufacturer with specific design information, not just call up and say "hey, make that part for me".

Here is a more detailed answer.

Question: How does this owner-produced rule work? Does the owner have to make the part himself?
Answer: The answers can be found in a FAA Memorandum dated Aug. 5, 1993, in which the assistant Chief Counsel for Regulation makes the following interpretation:

A part does not have to be solely produced by the owner to be considered an owner produced part.
The aircraft owner must participate in the manufacture of the part in at least one of five ways for it to be considered an owner produced part.
1. The owner provides the manufacturer of the part with the design or performance data.
2. The owner provides the manufacturer of the part with the materials.
3. The owner provides the manufacturer with fabrication processes or assembly methods.
4. The owner provides the manufacturer of the part with quality control procedures.
5. The owner personally supervises the manufacture of the new part.

As anyone can see, the discriminators for determining owner participation in a new part's manufacture are very specific in the interpretation. Attachment (A) to the 1993 Memorandum clearly stipulates that the FAA would not construe the ordering of a part as participating in controlling the design, manufacture, or quality of a part. The key point is that the aircraft owner must participate in the part's manufacture.

Username Protected · **Posted:** 22 Sep 2013, 16:03

Tim,

To my knowledge the legacy support wasn't pushing Cessna to insolvency. It was simply not meeting textron's internal rate of return goals. There was an explicit decision to abandon the previously held corporate value of product support. It probably had to happen eventually but it's still sad.

Username Protected · **Posted:** 22 Sep 2013, 16:29

Username Protected wrote:

I started gearing up to make cessna parts about 6 months ago
nose bowl parts, cowl flaps, wing ribs, etc--Cessna pricing is crazy stupid
I can make this stuff and sell it for 10X my cost and still be 1/10 the cost of getting it from cessna

You are the man, Kevin. I hope this venture is a tremendous success.

Username Protected · **Posted:** 22 Sep 2013, 17:11

The owner can contract someone to produce the parts if they supply the materials, specifications, or performs QC on the part. see below

Question 1: Does the owner have to manufacturer the part himself in order to meet the intent of the rule?

Answer 1: No, the owner does not have to make the part himself. However to be considered a producer of the part he must have participated in controlling the design, manufacturer, or quality of the part such as:

1. provide the manufacturer with the design or performance data from which to make the part, or
2. provide the manufacturer with the materials to make the part or,
3. provide the manufacturer with fabrication processes or assembly methods to make the part or,
4. provide the quality control procedures to make the part or’
5. personally supervised the manufacturer of the part.

http://150cessna.tripod.com/obrienonownermadeparts.html

Username Protected · **Posted:** 22 Sep 2013, 17:33

Username Protected wrote:

Friend of mine has C182RG an he recently had to purchase a landing gear part for $17000 :sad:

This part was $5000 a few years ago. He ask if things are any better at Beechcraft. He is thinking of finally switching to brand B. For years he has make comments as to high cost of maintaining a Bonanza. Anybody have any comparable as to what beech landing gear parts cost. The part in questions was a piece of milled aluminum that his gear rest on in up locked position.

I know the part you are talking about. There was one on our field that needed that part. The owner of the plane made his own and the shop installed it. You could not tell the difference in the parts. I think it took him about 4 hours to fabricate including the planning. This is why aviation is dying slowly. $17,000 pieces of milled aluminum are not going to be installed in $20-75k airplanes. You can't tell me that Cessna is unable to produce that part for under $1,000 when a guy can build it in his own shop in 4 hours from scratch.

Username Protected · **Posted:** 22 Sep 2013, 18:05

Username Protected wrote:

Friend of mine has C182RG an he recently had to purchase a landing gear part for $17000 :sad:

This part was $5000 a few years ago. He ask if things are any better at Beechcraft. He is thinking of finally switching to brand B. For years he has make comments as to high cost of maintaining a Bonanza. Anybody have any comparable as to what beech landing gear parts cost. The part in questions was a piece of milled aluminum that his gear rest on in up locked position.

I know the part you are talking about. There was one on our field that needed that part. The owner of the plane made his own and the shop installed it. You could not tell the difference in the parts. I think it took him about 4 hours to fabricate including the planning. This is why aviation is dying slowly. $17,000 pieces of milled aluminum are not going to be installed in $20-75k airplanes. You can't tell me that Cessna is unable to produce that part for under $1,000 when a guy can build it in his own shop in 4 hours from scratch.

Username Protected · **Posted:** 22 Sep 2013, 18:07

Username Protected wrote:

John Frank, owner of the Cessna Pilots Assn, had an article this month about Cessna Parts. Basically says what we see above. Previous cultural commitment to making legacy airplane maintainable in a timely, affordable fashion has gone. Every part now basically needs a viable business case. The $17K landing gear part isn't a joke. Parts are increasingly non available or can be ordered with a 80 week leadtime, etc.

An A36 might end up being a better deal than a 182RG. There are a lot more Bonanza airframes out there to support than 182RG's.

Maybe better if Cessna will just totally abandon the legacy airframes and sell the business to someone who is interested.

Charles,

Here is the counter. If a particular model does not generate sufficient parts business to support itself, why should it take down the rest of the company?
If we want Cessna to be around to support the majority of the legacy fleet and still produce new aircraft, then new aircraft sales and legacy planes like the 172 cannot be expected to support the 182RG.

Tim

Username Protected · **Posted:** 22 Sep 2013, 18:24

My B55 didn't come with a taxi light so I asked my mechanic to install one. There were only a few parts needed as the switch was already installed in the instrument panel. It turns out the bracket to hold in the bulb, a small stamped piece with four screw holes, was $1300 from Beech. We sought an alternate source.

Username Protected · **Posted:** 22 Sep 2013, 19:05

Username Protected wrote:

... If a particular model does not generate sufficient parts business to support itself, why should it take down the rest of the company?
If we want Cessna to be around to support the majority of the legacy fleet and still produce new aircraft, then new aircraft sales and legacy planes like the 172 cannot be expected to support the 182RG.

The question is whether a commitment to legacy support is a quality which helps sell new airplanes. If so, then legacy support is a part of running the company and shouldn't be treated simply as its own profit/loss center.

Cessna Parts vs Beech Parts