VCs caused the problem when they gave Vern funds to begin with.


Obviously, Vern should have sold to these surprisingly bad Chinese business people who fund losing projects.

Mike C.

So, we've gone through:

- it's a bad design

to

- it'll never get certified

to

- they won't actually deliver many of these

and now to

- they'll lose money.


But Cirrus just keeps moving forward, selling planes, making deliveries. It's good to see their plans all coming to fruition, and I hope it continues like this for years to come.

If you are saying that Eclipse was a losing project that should have never been funded, I disagree. Vern made a bunch of execution errors, but the concept behind the Eclipse was quite sound. Vern's contention was that the airplanes are expensive because we hand-build them in small quantities. He's right about that.

The problem is you need to have a low price to get the orders needed to scale up the production, but you can't make money at that price until scale up. So you have to be prepared to lose a bunch of money in the beginning. Vern comes from the world where this is not a problem, and the money is plentiful and free. And it was in the beginning, but then 2008 crisis hit, and the VCs pulled the plug.

So yeah, if Vern had the kind of investors Cirrus has right now, we could have very well had Eclipses darkening the skies by now like he predicted. But no, the Chinese are not bad businessmen at all, they know exactly what they are doing. In a few years, having sucked up all know-how they can, they will move the production to China and sell thousands of those things to nouveau riche Chinese citizens while manufacturing them at 1/2 the cost. That's where the profits will come in.

Spot on synopsis.

If you are saying that Eclipse was a losing project that should have never been funded, I disagree. Vern made a bunch of execution errors, but the concept behind the Eclipse was quite sound. Vern's contention was that the airplanes are expensive because we hand-build them in small quantities. He's right about that.

The problem is you need to have a low price to get the orders needed to scale up the production, but you can't make money at that price until scale up. So you have to be prepared to lose a bunch of money in the beginning. Vern comes from the world where this is not a problem, and the money is plentiful and free. And it was in the beginning, but then 2008 crisis hit, and the VCs pulled the plug.

So yeah, if Vern had the kind of investors Cirrus has right now, we could have very well had Eclipses darkening the skies by now like he predicted. But no, the Chinese are not bad businessmen at all, they know exactly what they are doing. In a few years, having sucked up all know-how they can, they will move the production to China and sell thousands of those things to nouveau riche Chinese citizens while manufacturing them at 1/2 the cost. That's where the profits will come in.

Eclipse was too early for the land grab that is Chinese investment. If the eclipse saga had transpired 5 years later than it did, China would have been a very viable option. There's plenty of well to do factory owners, etc.. that would have been thrilled to own a jet company.

I'll wager the SF50 plans were/are a big part of what made Cirrus attractive. China doesn't really care about piston planes. But, the SF50 could be a whole market by itself over there.

I would expect that within a few years, all the FBO ramps in China will be 65% domestically built SF50s and 35% Gulfstreams.

I agree.

USA is only a small part of the market.

I dont think Chinese have plane made SF50 in China it makes no sense , who works in the China market knows what is happening there for product with label made in USA and made Germany people pay good money . Now is time made product here and sell in China

Like how Cessna made the Sky Catcher there?

Tim

He was wrong about thinking he could do high volume production at low cost.

Personal jet aircraft are intrinsically low volume. That's chapter 1 in Aviation Business for Dummies.


You are delusional if you think more VC money would have let Eclipse turn a profit.

I think you would have been the kind of business adviser Vern would have listened to. He sure didn't listen to anyone who knew the industry.

Mike C.

Almost everybody was delusional pre-2008. Vern and a lot of,others didn't have the deep pockets to ride it out. The Eclipse is still going. The Mustang isn't. Tim brought up a good point. Probably, most of the time "engineer think" doesn't sell a product. There has to be some (engineers call it Voo Doo) marketing. That's just the real world. BS, bait and switch, call it whatever. It's not supposed to be disrespectful to the engineers, and bean counters; it's just reality.

It took me a long time to discover a fundamental business principle because I was trained in something else much more technical. Like engineers. The best product at the best price gets the market. After one establishes a market, establishes a reputation, then one can raise their prices some, and within reason. But first you have to have a market and first you have to have a reputation.

If you are saying that Eclipse was a losing project that should have never been funded, I disagree. Vern made a bunch of execution errors, but the concept behind the Eclipse was quite sound. Vern's contention was that the airplanes are expensive because we hand-build them in small quantities. He's right about that.

The problem is you need to have a low price to get the orders needed to scale up the production, but you can't make money at that price until scale up. So you have to be prepared to lose a bunch of money in the beginning. Vern comes from the world where this is not a problem, and the money is plentiful and free. And it was in the beginning, but then 2008 crisis hit, and the VCs pulled the plug.

So yeah, if Vern had the kind of investors Cirrus has right now, we could have very well had Eclipses darkening the skies by now like he predicted. But no, the Chinese are not bad businessmen at all, they know exactly what they are doing. In a few years, having sucked up all know-how they can, they will move the production to China and sell thousands of those things to nouveau riche Chinese citizens while manufacturing them at 1/2 the cost. That's where the profits will come in.

It's open to anyone who has the pocket depth required to buy a SF50...

That, of course, depends on the price.

How do you know?