TBM 910 base list price is $3.7M (2017 price sheet).

Current price for SF50 is about $2.4M when CPI and "required" options are included.

The TBM is about 50-60% more, not double.

Mike C.

https://www.youtube.com/watch?v=9KhZwsYtNDE

Not a myth.

Mike C.

https://www.youtube.com/watch?v=9KhZwsYtNDE

Not a myth.

Mike C.

Because that is what you can buy a TBM for.


$200K more.


Same as who buys a base SF50.

Mike C.

Because that is what you can buy a TBM for.


$200K more.


Same as who buys a base SF50.

Mike C.

Not a myth.

Cirrus is facing the same problem as Eclipse had, namely, the faster they produce them, the faster they lose money.

Consider this listing:

https://www.controller.com/listings/air ... ision-sf50

Position 341, $1.39M base price. This is the highest position advertised.

What this tells us is that the $1.39M base price is most of the order backlog. Cirrus raised the price to $2M some years ago, but where that starts in the backlog beyond 341 is not known.

You don't raise the price that much if you could make money at the previous price. So it is fair to assume Cirrus is not making any money on the "$1.39M" positions, and in fact could be losing money on each one.

So Cirrus is likely facing 3-4 years of turning out a product at a loss. The faster they make them, the faster they lose money. Then, years from now, they maybe get to make a few at a small profit. That's if the order backlog doesn't dry up from lack of demand or a secondary market taking the sales.

And that doesn't even include development costs, this is just pure manufacturing return. They will probably never make back the development costs, so the overall program is very likely a loss no matter what happens in manufacturing.

Hell of a business plan, often repeated in aviation alas.

Like Eclipse, I bet Cirrus is trying to figure out how to jack the price on early depositors. They have overpromised and underpriced. I don't have a copy of the early depositor agreement, so I don't know if Cirrus has an escape clause. It wouldn't surprise me if they exercise one and give back the deposits and start the order book over again at the new price. They will try to do this after some number are out and have established a positive vibe they can leverage for the change. My crystal ball says some time in early 2018 would be when this would happen.

Mike C.

Twin jet safer than single jet.

Apples to apples.

Buyers choosing SF50 to avoid "twin problems" are using piston think.

Mike C.

is this the same crystal ball you've used for your other predictions on this topic, or did you go on amazon and get a new one ?

I think this a fair analysis and they may try and jack the price.... But that doesn't mean they won't be successful,.

Your analysis does however leave out a comparison between the economic environment of 2008 vs. today. The world economy is growing like never before in history. 3rd world countries are becoming 1st world countries. The next 10 years the Earth will change a lot. A couple hundred early deposits to Cirrus won't mean a hill of beans in the grand scheme of things. I could see Cirrus being bought by Apple or Google or the like.

And with the price of new units much higher, the used market prices should be supported nicely.

How's that MU2 fleet holding up?

You are making the assumption they lose money at 1.39 Million.
They may raise the price to 2.4 because they can. because the cost of sales may be higher. Do not forget, for the initial buyers, Cirrus did not have much of a sales force to pay commissions. They had free press in many ways, so no marketing...
Also, the closest competition was the Meridian, which was around 1.5 Million. As Piper raised the prices, so has Cirrus.

Or the 1.39 could cover variable costs and no recovery of R&D.... The point is you do not know. So unless you have access to the financial reports, you just have speculation.

Tim

Meh, if they're losing money they'll make it up in volume.

That, and proprietary parts.