Van’s Aircraft owes a lot of creditors relatively modest amounts of money, according to legal filings relating to the case. In its bankruptcy petition, the company says it owes from $10 to $50 million, but the top 20 creditors listed on its bankruptcy petition are only owed a fraction of that. The balance is owed to 25,000-50,000 creditors. The distribution of the balance of the debt beyond the top 20 isn’t included in the filing. There is some positive news for those owed money. Van’s says on the filing it expects to have funds “available for distribution to unsecured creditors.”
The largest single creditor is Lycoming, which is owed $598,323. Metal supplier Pacific Metal Company, of Tualatin, Oregon, is on the hook for $219,640.62 and Hartzell has $130,056.34 on its books. Number 4 on the list is a legal settlement to an individual in Texas in the amount of $87,500.02. Van’s was required to list the top 20 creditors in its filing and most of the remaining 16 on the list are businesses that provide goods or services to Van’s. The amounts owed range from $63,889.28 for No. 5 to $35,428.90 for the No. 20 creditor.
I sincerely hope Van’s reorganization effort is successful for the company and its creditors, especially the many customers with deposits and pending orders. It is important for the EAB industry that this works out well.
Assuming the stock of the company is not otherwise pledged, why not provide an offering to pay off the debt with current creditors as initial prospects ? VAN won’t live forever and likely the future operators of the company will do so simply to maintain the fleet. Who knows, if well-managed could be an IPO in it’s future. Hopefully the Chinese or UAE don’t already own the majority shares.
This is a terrible blow to the community and I hope Vans figures it out. What they have done for GA is greater than all the other organizations put together.
Holly Molly?! I feel bad about this one.
I believe the problem here is complex; not “simply inflation” as one commenter said yesterday. Richard Vangrunsven is now ~84 years old. So, before laying everything at Van’s feet, consider this statement from Van’s own website:
“…Van’s Aircraft became employee-owned several years ago and the day-to-day operation of the company is now handled by others, but Van still has his desk and participates in the strategic conversations and provides design input. After years of working long hours, Van has carved out a little more time for himself…”
And he deserves that time for himself. He accomplished great things in the EAB world and will always be remembered as an engineer who succeeded by designing airplanes with wonderful flying characteristics by enhancing the basics in aerodynamics and materials.
I built an RV-4 back in the eighties and nineties. The construction manual looked like it was typed on a 1950s era manual typewriter with some hand-drawn pictures. The blueprints were very well done with lots of details that made the building process understandable (not easy) for the first-timer. He was known, as some people called him, a “cheap Dutchman.” A far cry from modern business school practices that put the company on the road to ruin by taking on too much debt without considering what would happen if a bad situation occurred. Like the laser-drilled holes problem. Sounds like a small problem, but consider the implications of that mistake. Burdened with debt, little problems can become insurmountable.
I don’t know all the inner workings of the company, but I just had to comment to support Van personally. The business mistakes may doom this once outstanding company and that makes me very sad.
clearly its not employee owned if he’s taking responsibility for the collapse.
Sad news.
I hope for the best but in all likelihood this is insurmountable. I could not in clear conscience recommend buying a new RV kit at this point and if I was in the process of building one I’d make sure I had all the parts on hand for completion ASAP.
This will also affect the price on completed/used RV’s as the desirability goes down without continued factory support.
Especially sad as that they are very good airplanes.
The fact that Van’s is seen as a big player by the personal-GA world works to obscure the fact that it’s really been a shoestring business. While by the book it may be employee owned, in reality it is “owned” by the thousands of up-front depositors, who in effect served as investors providing the operating capital.
Absent some deep-pocketed backstop, this sort of operation is inherently fragile, vulnerable to any sort of imbalance in the income/expense chain. At this point, what is needed is some entity willing to commit that 8-figure backstop with virtually no hope of profit.
un fortunately this is common mistake for small growing companies. things go a little wrong and there is still hope that the next good sale or? will get the $ you need. those kinds of business needs a CEO experienced in growing a business to catch things early and compensate early. Vans seems to have been built and run by a group focusing on build a great aircraft and meeting the customer needs which is a great mission.
they appeared to work to keep prices down and service the customer. a great goal.
hopefully new management will come in help understand the business they are in and move forward. the aircraft will never be as inexpensive as they were but perhaps a great company can be built so to meet the needs of small aircraft flyers.
I am personally looking for them to build a version of the RV10 that will meet the new requirements of MOSAIC. 4 passenger (or 2 and stuff) that will meet the requirements especially for less than 54 knot stall, clean, flaps up.
That is the aircraft I am looking for.
Sounds like Molly has the Christmas spirit!
This is really tough news for me, too. I went the homebuilding route also but liked the Zenith line at the time around 2008 and built a low wing Zodiac model with a Viking aircraft engine.
Best wishes for all involved for a favorable outcome, not much to be happy about during the holidays for many. With the recent stories on airport closings and now this it’s a very tough time for us all.