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More on VLJ Price Fantasies

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In a blog last month, I opined on the state of play in the very light jet market, such that a sustainable market really exists for such aircraft. Sustainable is the key word, for at the right price, you can sell anything. But that doesn't mean you can sell enough of it to make a lasting business.

As is the way of the Web, that blog has scrolled off in visibility, but in the background it has elicited some interesting and informative commentary from readers on the nature of light jet aircraft and the engines that power them. It's worth another look here and also another line of discussion, in my view.

By its very nature, aviation seems to inspire a certain dreaminess and edge-of-technology wonder that suggests that waiting in the wings is the next big thing that will change the game. The Eclipse VLJ, with its much vaunted "disruptive technology" was supposed to be an example. The new all-electric airplanes are getting the same treatment. To keep things focused, I'm not thinking here of leaps in performance, but incremental improvements in performance at the same or lower prices than that which went before. Both the VLJ and electric initiatives were and are flirting with this idea. Here's why I think the chances of success are difficult at best.

Technical discussion on engine efficiencies and costs often revolve around the notion that engine development drives airframe development. While that's true, it goes both ways. An airplane concept can spur engine development and, to a degree, that's what happened in the stunted VLJ world. The assumption that a major breakthrough in engine technology would break the market wide open was tested and found wanting.

What was the breakthrough? The Pratt & Whitney 600 series engines developed for the Cessna Mustang and the Eclipse and, one assumes, eventually others. What set Pratt off developing these new, small and light turbofans was that customers were saying they wanted cheaper, simpler engines for a new class of airplanes. Efficiency wasn't the main driver, Pratt executives told me during a visit to the Montreal plant in 2005.

Airplane companies keep exact dollar amounts close to the vest, but my guess is Pratt hit its cost and simplicity goals. During my plant visit, they showed me the assembly line for the 600 series which, as I recall, was barely 100 feet long with something like eight stations. I asked if what I was looking at was a proof-of-concept line and the tour guide said no, this was the real thing. The assembly lines for other engines were four or five times longer, thanks to the fact that the 600 series has 40 percent fewer parts compared to engines of similar pressure ratios. Whether that's a paradigm shift or not is debatable, but there's no doubt it's a significant leap forward.

So why didn't it ignite the VLJ demand that NASA, Eclipse, Pratt, Williams and everyone else expected? This question will be analyzed for years to come, but my guess is bad timing will be a major player when the history is written. Or maybe the engine just wasn't efficient enough to push direct operating costs into some imagined sweet spot. Or could it be that the same harsh economics of engine cost versus airframe cost still rule? For high-performance piston aircraft, the cost of the engine is a small percentage of the total cost of the airframe—under 10 percent. I don't have good numbers for small jets, but I suspect the percentage is somewhat higher.

With a less expensive engine in hand, or at least promised, Eclipse planned to radically simplify construction through clever things like friction-stir welding. In reality, they reverted to what every other airframer does—some automation where possible, but lots of high-skill fitting, hammering, tapping and filing. Airplanes remain a product of handwork, which is expensive. They remain expensive to develop and certify.

Fast forward that idea to the day when some enterprising engine company does what Pratt or Williams isn't interested in doing: Producing a relatively light, relatively powerful, relatively efficient and relatively inexpensive turbofan for a small airframe with low market numbers. The key word is "relatively." As long as these engines burn hydrocarbons, we're unlikely to see more than incremental leaps in efficiency. Just as Eclipse's claims of Baron costs at jet speeds proved a dead end, so will four-place turbofans cruising on piston budgets, or a little more. You want seat-mile efficiency? Buy a Dreamliner, if Boeing gets it built.

That's not to say the four-place (or five) turbofan isn't achievable, either with current engines or new-age more efficient ones. Cirrus is doing it and so are Diamond and Piper. But the point I made in my previous blog is that just as Eclipse found the costs of bringing these airplanes to market more than projected, so will Cirrus and Diamond, in my view. At just over $2 million, Piper's price seems about right.

Aircraft business plans are usually based on the perceived size of the market, which seems always smaller than the companies imagine it to be. Just how price sensitive it is no one really knows because the VLJ market is barely developed, much less mature. My idea of a realistic VLJ or even turbofan four-placer would entail a company selling about 40 to 50 airplanes a year, worldwide. This seems doable and sustainable to me.

But the numbers just don't work. Development costs are so high and demands on investment return so great that it takes twice as many airframes as that to make the project worth the effort. This ups the ante considerably, especially if everyone and his brother in law decides to get into the game. The market can absorb only so many airframes in a given segment and when the world economy turns down—as it has now—the number is vastly smaller.

Giving away the engines for free probably wouldn't change that. So I'm not so sure we'll see the flourishing of the four-seat, everyman's turbofan. To me, it feels like just another version a flying car in every driveway, a persistent fantasy that still excites many.

What will see, in my view, is a steady, incremental expansion of the turbofan market downward, with modest sales numbers. Just as Cessna predicted we would.

Comments (8)

Having recently read the book: “The Black Swan”, I’m a little hesitant to spark up the crystal ball. But I am thinking that it may very well turn out, that the sale of the assets of Eclipse, including the TC for $40,000,000 was the bargain of the century. I’m actually rather surprised that the Russians or the Chinese didn’t snap up the assets of Eclipse. I followed Eclipse ever since the first public announcement of its formation and what it intended to do. I also remember the refrain of the “experts” saying: “they’ll” never get friction stir welding approved, “they’ll” never get the performance numbers they’re quoting, a turbofan engine that small cannot be produced and still have any kind of acceptable efficiencies. The PW600 series engines are now available to buy on the market; as is the G1000. The wheels have already been invented. Assuming the world economy gets turned around, the next decade will be interesting. Does anyone know have far over budget the A380 and the B782 was/are?

Posted by: JOHN MININGER | October 7, 2009 5:33 AM    Report this comment

But for the bumbling nature of Mr Rayburn, Eclipse founder and CEO, the Eclipse would be the basis of successful air taxi businesses. His poor engineering, blame it on the suppliers and advertising of unrealistic pricing and time goals led to the production of problem laden aircraft in spite of a very successful template for a worthy aircraft and air taxi vision. VLJ's will emerge and find a a place in the aerospace industry in the years to come though delayed temporarily by the present recession. The real visionary behind the concept was Dr Sam Williams, founder of Williams International and designer of the original VLJ and Light Jet engines. I beleive his vision will someday be realised. The stars were simply not aligned when Mr Rayburn took on the task and proved to be inadequate for the mission.

Posted by: thomas williams | October 7, 2009 8:38 AM    Report this comment

Eclipse didn't ignite much demand? When Chapter 11 was filed, there were more confirmed orders for the EA-500 than all the Pilatus PC-12's ever sold in the U.S., and all the Socata TBMs and Meridians ever produced. Why not 10 times that? Because the plane wound up costing $2+ million instead of $1 million. At $2+ million, it's still a great breakthrough for general aviation, but it won't sell a thousand copies a year.

Development costs probably will stifle future VLJs. That gives Eclipse Aerospace an enormous leg up--they've got a fully-developed, fully-certified, terrific plane, and they don't have to amortize its development at all!

What about the dream of jet flight with Baron costs? Well, I don't know about a Baron, but in the 18 months I've owned my Eclipse 500, direct operating costs per mile have been right in line with what DOCs per mile were for the twin Cessna I owned for 17 years.

There just is no comparison between an Eclipse and a twin Cessna. Both are great planes. But the Eclipse is 150 knots faster, climbs much better, cruises much higher, has a quiet, vibration-free cabin, and flies over the weather in jet comfort. I've taken off from New York in the morning and been back home in California by 2PM, while spending no more money than the long slog in my twin Cessna would have cost me. The Eclipse makes personal, mid-continental and trans-continental jet flight achievable for guys for whom it was previously an impossible dream.

Posted by: KENNEETH MEYER | October 7, 2009 8:41 AM    Report this comment

As a former Dayjet pilot, I will attest that the passengers throughout the large and small cities of the Southeastern US absolutely LOVED the alternative service we provided, -even with the bug-riddled Eclipse. I became convinced that the air-taxi market was real and Dayjet would have blossomed if the capital lending crisis had not stifled necessary expansion essential to reach critical-mass and profitability. I was eager for Dayjet's expansion northward, and being originally from Milwaukee, envisioned the numbers of small businesses in the Chicago/Milwaukee/Minneapolis/Detroit area that would love to have access to the service. I worked in Architecture/Engineering and manufacturing, and know how much small and mid-sized businesses in non-hub cities need air taxi alternatives to the airlines. Ironically, after Dayjet closed I taught airline pilots from Europe and Kazakhstan, where the need for commercial air travel is growing. Air travel is cheaper and quicker than building highway infrastructure, and airlines train pilots here for our inexpensive flying and robust GA flight training infrastructure. VLJ use strengthens our infrastructure and bolsters a unique US industry threatened by growing user-fee mentality. Off-route VLJ use “right-sizes” passenger needs with services and reinforces the commercial and GA segments of the US aviation industry.

Posted by: Matthew Bancroft | October 7, 2009 6:12 PM    Report this comment

As has been discussed ad nauseum on the previous thread, current engines like the FJ33/44 and PW600 aren't optimized for flight at lower airspeeds and altitudes. If Price Induction's EGEN engine series pans out, an essential part of the puzzle will be available to build a (relatively) fuel efficient 4-6 seat personal jet. Then it's just a matter of an airframer seeing market potential and committing to its development.

Posted by: Will Alibrandi | October 8, 2009 10:39 AM    Report this comment

The big breakthrough is the single engine jet as exemplified by Cirrus. You have one well proven real engine in use by the existing light twin-jet segment. The single engine turbine pioneered by Caravan, TBM700, PC12 and has obtained both regulatory approval and excellent in-service experience. How much better if we throw away the gearbox, propellor and controls. When you loose about 1000lb of emty weight then you have a good chance of stalling at less than 61kt and an all up weight under 6,000lb which is somewhere near a Baron58TC. At this weight you can use low pressure tyres suitable for sod or gravel surfaces and, because of the low stall speed, runways can be 3000ft where your aspiring jet customer used to land his Bonanza and currently lands his Baron. Provided the builder keeps stictly to the KISS principle the aircraft should cost about the same as a Baron, be manageable by its owner pilot and maintainable by the same shop that looks after the Baron. Because of the inherent inefficiencies of turbines at low altitude you have to have pressurisation. If you have pressurisation then you might as well get yourself out of the ice-laden alto-clouds and fly (mostly)ice free at around 30,000ft. One more piece of brilliance is to put the precious turbine where it has minimal chance of FOD. Cirrus showed the world how to build a 21st century airframe, spoilt only by the 50yr old power plant. Now they have the chance to get it all right.

Posted by: Roger Merridew | October 14, 2009 5:52 AM    Report this comment

Pressurization would be a must, but a 30k operating ceiling means the jet would have to be RVSM compliant, which would add to the cost. (doesn't quite fit with the KISS axiom) If the engines were optimized to fly at lower altitudes, say 20-25k, that would simplify things a bit.

Posted by: Will Alibrandi | October 14, 2009 8:06 AM    Report this comment

I think they did!

Posted by: Roger Merridew | October 14, 2009 9:10 AM    Report this comment

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