BeechTalk - BT

Username Protected · **Posted:** 29 Dec 2013, 17:03

Username Protected wrote:

Here's my prediction and I've said this here before…… The future of general aviation/owner flown is:

Cirrus
Pilatus/TBM
Embraer
Cessna

All others will fall by the wayside and end in the junk heap or be gobbled up by one of the above.

I predict GA is gonna get a huge boost in the next few years thanks to mostly to Garmin but also to Cirrus. People want out of commercial aviation and into their own plane. Lot's of folks can afford to finance a $2MM plane if the operating costs are kept somewhat reasonable and training is not too onerous. Single engine allows for reasonable operating costs and automation/Garmin keeps training less onerous.

That may happen to some extent, but Pilatus/TBM are in a class that most cannot afford. That is where we will try and fill the market. Give the people that don't have the gobs of disposable income a solution that fits their needs.

Username Protected · **Posted:** 29 Dec 2013, 18:59

Username Protected wrote:

That may happen to some extent, but Pilatus/TBM are in a class that most cannot afford. That is where we will try and fill the market. Give the people that don't have the gobs of disposable income a solution that fits their needs.

"Most cannot afford"? Those companies sell every machine they manufacture. Back ordered for months and months. You and I are not looking at the same data pool or we are interpreting the data very differently.

A lot of "people" can afford these things. A lot of "pilots" cannot afford these things. But don't separate the 2. Every year automation makes them more and more one in the same. And…… Even while a pilot is required, it's very little expense compared to the rest of the package.

My buddy I share a hangar with has a full time pilot he pays very little. The guy is on call 24/7. If I chose to no longer pilot my plane it would cost very little to have a full time pilot handle everything.

I see private airplane ownership growing a lot in the future. I think a $2MM Cirrus Jet or $2MM Evolution are great airplanes that move you and your family with great ease and little expense in the grand scheme of things.

Username Protected · **Posted:** 29 Dec 2013, 19:14

Username Protected wrote:

"Most cannot afford"? Those companies sell every machine they manufacture. Back ordered for months and months. You and I are not looking at the same data pool or we are interpreting the data very differently.

Pilatus has sold approx 1500 PC12's since they invented them in 1991. That's not exactly cranking them out. How many do they build a year and how many of those are destined for part 91 ops?

Username Protected · **Posted:** 29 Dec 2013, 19:23

Username Protected wrote:

Pilatus has sold approx 1500 PC12's since they invented them in 1991. That's not exactly cranking them out. How many do they build a year and how many of those are destined for part 91 ops?

I think they build 50 a year. The company is very profitable. I think they intentionally restrict supply and can "crank out" more than they do. It's really just been the last 6 months that the economy is rebounding. I'm speaking on what I see in the last 6 months. Many flight departments are switching to PC12. Hence the glut of inefficient jets for sale.

If people are paying $4.5MM for a new PC12 the will certainly spend $2MM for a Cirrus Jet or a Certified Evolution. That's the only reason I bring it up.

Username Protected · **Posted:** 29 Dec 2013, 19:25

Username Protected wrote:

"Most cannot afford"? Those companies sell every machine they manufacture. Back ordered for months and months. You and I are not looking at the same data pool or we are interpreting the data very differently.

Pilatus has sold approx 1500 PC12's since they invented them in 1991. That's not exactly cranking them out. How many do they build a year and how many of those are destined for part 91 ops?

Username Protected · **Posted:** 29 Dec 2013, 19:27

Username Protected wrote:

Between the Meridian, the PC12, and TBM, each build around 30 units/yr. With an industry building around 100 new single turboprops, it's a pretty small market.

OK, let's go with that number and add all the $800K single engine Cirrus being built.

Is there a faster growing segment than SE with tons of automation?

How many G650's can Gulfstream build in a year?

Username Protected · **Posted:** 29 Dec 2013, 19:29

Username Protected wrote:

That may happen to some extent, but Pilatus/TBM are in a class that most cannot afford. That is where we will try and fill the market. Give the people that don't have the gobs of disposable income a solution that fits their needs.

"Most cannot afford"? Those companies sell every machine they manufacture. Back ordered for months and months. You and I are not looking at the same data pool or we are interpreting the data very differently.

A lot of "people" can afford these things. A lot of "pilots" cannot afford these things. But don't separate the 2. Every year automation makes them more and more one in the same. And…… Even while a pilot is required, it's very little expense compared to the rest of the package.

My buddy I share a hangar with has a full time pilot he pays very little. The guy is on call 24/7. If I chose to no longer pilot my plane it would cost very little to have a full time pilot handle everything.

I see private airplane ownership growing a lot in the future. I think a $2MM Cirrus Jet or $2MM Evolution are great airplanes that move you and your family with great ease and little expense in the grand scheme of things.

Username Protected · **Posted:** 29 Dec 2013, 19:30

Username Protected wrote:

Between the Meridian, the PC12, and TBM, each build around 30 units/yr. With an industry building around 100 new single turboprops, it's a pretty thin market.

There's just no way the airlines are going to lose an even measurable portion of their customers to private, non business aircraft. What ever perceived hassle there is with airline travel is trivial compared to airplane ownership.

Username Protected · **Posted:** 29 Dec 2013, 19:32

Username Protected wrote:

The Pilatus has a very large number of businesses and charter company's that purchase them. Our market is for the owner operator. Two completely different markets. We'd be competing with the Bonanza, Cirrus, etc market but price point has to be there for those people to consider and afford it.

Not 2 different markets. They are one in the same. I own my company and my company owns my airplane. I also happen to fly it. So where do I fall? That's how my Bonanza was set up also.

What difference does it make "who buys it"? Bottom line is you are getting the sale and making the money. I don't care who buys the products I manufacture. I only care about "gettin' paid".

All airplanes manufactured fall under the same rules tax wise so it makes no difference who your target buyer is.

The PC12 was designed as a cargo plane. Pilatus stumbled into the market they have.

There is a Cirrus charter company here in Atlanta called ImagineAir.

Username Protected · **Posted:** 29 Dec 2013, 19:33

The hope is that the Cirrus jet will attract additional buyers. Beech might cannibalize their King Air line somewhat with a new single, but it's probably still a pretty smart move.

Notice that Cessna bought the certification for the Premier? It's a decent bet that will be the new airframe for a Beech/Cessna's new single.

Username Protected · **Posted:** 29 Dec 2013, 19:34

Username Protected wrote:

Notice that Cessna bought the certification for the Premier? It's a decent bet that will be the new airframe for a Beech/Cessna's new single.

I'd be into that.

Username Protected · **Posted:** 29 Dec 2013, 20:51

Username Protected wrote:

The Pilatus has a very large number of businesses and charter company's that purchase them. Our market is for the owner operator. Two completely different markets. We'd be competing with the Bonanza, Cirrus, etc market but price point has to be there for those people to consider and afford it.

Not 2 different markets. They are one in the same. I own my company and my company owns my airplane. I also happen to fly it. So where do I fall? That's how my Bonanza was set up also.

What difference does it make "who buys it"? Bottom line is you are getting the sale and making the money. I don't care who buys the products I manufacture. I only care about "gettin' paid".

All airplanes manufactured fall under the same rules tax wise so it makes no difference who your target buyer is.

The PC12 was designed as a cargo plane. Pilatus stumbled into the market they have.

There is a Cirrus charter company here in Atlanta called ImagineAir.

Username Protected · **Posted:** 29 Dec 2013, 20:54

Username Protected wrote:

If you can buy a comparable priced 6 seat airplane that performs the same as a 4 seat, why would you buy the smaller plane?

You can't. What are you talking about?

Username Protected · **Posted:** 29 Dec 2013, 21:00

Username Protected wrote:

If you can buy a comparable priced 6 seat airplane that performs the same as a 4 seat, why would you buy the smaller plane?

You can't. What are you talking about?

Username Protected · **Posted:** 29 Dec 2013, 21:22

A six seat turbine a la TBM is well over $3MM

A 4 seat pressurized turbine will fill in nicely at $2MM

A new baron is $1.3MM and it's slow by comparison.

OT: Lancair Evolution