achimha wrote:
So go and start an aircraft manufacturing company @MedEwok! Sounds like nobody has realized now easy it is so the market is wide open for you
I stand by my argument though, if light airplanes were mass produced like cars they’d be way cheaper, without any loss in quality.
Peter wrote:
I think that if you halved the prices of new planes, their sales would hardly change. The demand is limited by a cap on the desire of people to fly GA.
If you halved the prices of new planes, the likelihood of Patrick buying a new plane in the foreseeable future would double. 
MedEwok wrote:
I stand by my argument though, if light airplanes were mass produced like cars they’d be way cheaper, without any loss in quality.
I think that is not being disputed – but to what extend this traces back to an utter and complete failure of the light aircraft industry on the supply side of things is. The low volume of sales forbids any investment in mass production technologies, no?
Patrick wrote:
The low volume of sales forbids any investment in mass production technologies, no?
One option would be to invest $500 million in an airframe and assembly plant, amortize it across the thousand airframes you’re going to build either way in the first ten years, then sell the airframes for $800K instead of $300K as you’d otherwise do, or $50-100K that the customer can spend for the same thing used, depreciated and widely available.
The airframe is only one part of an aircraft, so you’d need to do that with engines too (I’d suggest talking to Honda, they’ve already looked into it, bring money) and avionics (Garmin-esque startup anyone?)
(Mexican labor at $4/hr would be another option – it’s worked for VW for 50 years in conjunction with billions spent on the Puebla plant)
Peter wrote:
I think that if you halved the prices of new planes, their sales would hardly change. The demand is limited by a cap on the desire of people to fly GA.
That’s more or less it IMO. The market is so small that the only way to make money is to aim for the very top. Look at the Cirrus. No retract – uncomplicated, BRS – safe, all the newest gadgets, luxurious, fast. It cost 1M € or whatever, still it is only an uncomplicated SEP that everyone can fly. It’s pushed to the limit regarding “flashiness”, while still being a simple SEP.
There is no problem making a 2-300k version, a simplistic version, but there is no money in it. 200k is still way too much for any volume sales, by orders of magnitude, so the only thing you will be doing is to cut your own profit. It’s better to go the other direction, take the jump to a complex TP and biz jets, they sell larger numbers than SEPs today.
Also, SEPs have huge competition from microlights and experimentals, pouring into the market each day.
MedEwok wrote:
The prices of new aircraft are mainly a sign of complete and utter failure by the light aircraft industry, nothing else.
That’s utter nonsense IMO. First, there really isn’t a light aircraft industry. Not in the same way as for instance the car industry. There are sold less than 1000 certified GA SEPs each year world wide. There are sold about 80 million cars each year. Homebuilders build more homebuilt aircraft each year world wide than the certified GA “industry” does. Aircraft are hand made, every rivet, every bolt, or every sheet of carbon fiber cloth. That’s the only way they can be made because of the complexity and the low volume. This will reflect the price. Aircraft aren’t really more expensive than boats. When you get just a bit up in size and HP, the price of boats also tips over 100k in a moment, and from there the price goes almost straight up. It’s the same effect as with aircraft. When the price gets above what 99% of the potential market is willing to pay, then there is more to gain by simply maxing it out. For aircraft this means TPs and biz jets. For boats it means yachts in the 1M class and up. All hand made.
Judging by aircraft sales and boats, the line seems to go somewhere between 100-200k or so.
@MedEvok
Sure … if they WERE mass produced they would be cheaper, you would be right :-) The quality would be higher too.
They are NOT mass produced, because there is no mass market.
Peter wrote:
I think that if you halved the prices of new planes, their sales would hardly change. The demand is limited by a cap on the desire of people to fly GA.
I think that’s exactly right. The “insane” price levels are a bit of a red herring in terms of describing the causality of the lethargic GA market for new aircraft.
Last year Cirrus sold around 280 SR22’s. Each one probably around USD750k.
If a factory new, loaded SR22 was USD250k, how many would they sell instead – 500?
I wonder where the favourable price break really happens though – I reckon if a factory new SR22 went for USD100k, Cirrus would probably sell 4 digits. However, even then, most of the buyers would probably be existing aircraft owners, promptly scrapping all their 30-40 year old Pipers, Cessnas etc.
There must of course be some price elasticity – there always is.
If an SR22 was 30k, all the old planes from the 1960s onwards would be scrapped, more or less immediately. But IMHO there is very little elasticity in the few hundred k price range.
And think of the massive stock overhang which would appear a decade later – IF planes lasted as long as the current ones do.
There are many brick-wall-head-banging factors which potential customers have to take care of before they can become owners. Start with getting a PPL. I have heard numerous stories of a good pilot who had a few lessons and loved it, then picked up the first of the 5 or so theory books, opened it on page 1, and chucked the whole project away. The PPL books are a joke. They are written mostly by ageing instructors who wanted to become immortal.
Alexis wrote:
@MedEwok
Sure … if they WERE mass produced they would be cheaper, you would be right :-) The quality would be higher too.
They are NOT mass produced, because there is no mass market.
Peter wrote:
And think of the massive stock overhang which would appear a decade later – IF planes lasted as long as the current ones do.
Cars last as long as airplanes but very few people consider the car equivalent of a C172 (Toyota Corolla, VW Golf?) to be worth keeping for 40+ years. Look at Cuba where the “buy new” option didn’t exist for decades, just like for GA aircraft.
If the difference in perceived value between a 2017 VW Golf and a 1980 VW Golf was the same as between a 2017 C172 and a 1980 C172, we’d see a lot more old Golf I models driving on the streets. Compared to household incomes, the 2017 VW Golf is not more expensive than the 1980 model but it is a million times better. A 2017 C172 has 4 cupholders instead of 4 ashtrays but that’s pretty much it. A lot of products aren’t even available anymore with no obvious “better” replacement. Think about the turbo 182 and the 182 retractable.
There is a part of the market that really wants the modern look and new feel and that’s what Cirrus captured. The vast majority of the market think like @Silvaire and realize that the old airplanes get you a lot of value for the money.
Cars last as long as airplanes but very few people consider the car equivalent of a C172 (Toyota Corolla, VW Golf?) to be worth keeping for 40+ years. Look at Cuba where the “buy new” option didn’t exist for decades, just like for GA aircraft.
My car is only a bit more than twenty years younger than my 66 year old ’plane – the push bike is five years old and replaced a thirty year old push bike – which is still in service with my son-in-law.
Ironically, the Super Cub clone industry remains a major component, in new unit sales, of the GA new build market.
