Van’s Resumes Shipping Kits, 65 Percent Of Customers Renew Orders

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Van’s Aircraft says 65% of customers have agreed to pay more for their kits and more than 100 of those kits have now been shipped. The company, which went into bankruptcy a month ago, says it’s ramping up kit deliveries but is still buried under email inquiries. “Our shipping throughput will increase over the coming weeks, and we will post progress updates,” the company said in an update posted Saturday.

Van’s also said it’s tackling the parts order backlog that resulted from supply chain issues over the last couple of years. “Our supply chain has been improving and we have team members working with our suppliers to continue to drive improvement in this area,” the update reads. The company says it’s also started directly contacting 1,800 customers who have major structural parts that have laser-punched rivet holes that will be replaced by the company. “All affected customers will be sent an email containing an individualized list of affected parts for each kit they have received,” the update said.

The company says it’s also working with third-party suppliers regarding orders for kits that included engines, avionics and propellers and had hoped to have some news regarding those orders this week but bad weather in Oregon forced closure of the plant for three days. “The planning that is currently underway includes a look at scheduling, lead times, payments, pricing, customer deposits, and more,” the update said. “We are working to have our plans shared by the end of next week with those customers who have open orders for engines, propellers and avionics kits.” 

Russ Niles
Russ Niles is Editor-in-Chief of AVweb. He has been a pilot for 30 years and joined AVweb 22 years ago. He and his wife Marni live in southern British Columbia where they also operate a small winery.

24 COMMENTS

  1. Early observation indicates Van’s is doing the right things to survive. That being said, moving forward, Van’s aircraft are about to become a whole lot more expensive. They’re doing what they should have done years ago. Had they done so, all of this gut wrenching and teeth gnashing probably would have been avoided. Does Hartzell provide Van’s with props, or, any other components?

    • My RV has a Hartzell constant speed prop. I built the airplane and have flown it for 20 years, I fly it regularly. I ordered the prop from Vans, it was shipped from Hartzell.
      Flying is more expensive, what isn’t? When the government simply prints more money it has less value.

  2. I sure hope that the retention of 65% of it’s customers at the new prices provides sufficient cash to keep the business going.

  3. IMO things are looking up at Van’s Aircraft! Lots of folks are sticking with the brand, with many resubmitting kit orders after the reorganization news. Kits are already shipping, and they’ve got a plan for replacing faulty laser-cut parts. There’s still some vital work to do on the engine deal, but an update with details on timing and costs is coming soon, probaly determining the outcome. The Van’s team is working hard appearing to be on the roll. Progress might be slow, but it’s steady, looking as if Van’s Aircraft is definitely heading in the right direction.

    • Jethro, I’d bet a good chunk of that 35% historically stop buying the next kit package deciding at some point going forward is not for them. Speculating… has to be added hesitancy due to loss of affordability or trust in the company’s future. I believe the engine and prop packages are no longer at the pre-inflation prices either.

      Some tough head winds driving caution for some. I would guess half of the 35% would bailout even in the best of times.

    • “The Impact of Chapter 11 Bankruptcy on Customer Retention: An Empirical Investigation.” by John J. O’Donnell and Christopher M. Pennings (2005): This study found a wider range of retention rates, from 20% to 90%, highlighting the influence of industry and pre-bankruptcy customer loyalty.

      I think 65% is reasonable.

    • So seems reasonable that almost all of those 35% will end up selling their projects because what else are they going to do with them? Once the projects are sold, probably half of the new owners will end up buying the next kit the project needs, and at least a quarter of them will eventually end up buying everything needed to finish the project.

      So probably closer to 75% or 80% buy in when its all said and done.

      • As I understand it, not agreeing to the new contract means you’re asking for a refund for any payment you’ve made for kits you haven’t received. You’ll be an unsecured creditor, and can only expect a partial refund.

    • If we’re going by percentages, something close to 100% of Van’s customers have also been impacted by inflation, so personal decisions based on factors beyond trust in the company come into play.

    • In the recent court hearing some of those 35% are holdouts awaiting news on the results of Vans negotiations with subcontractors (engines, props, avionics). Very possible that the 65% number could increase before the deadline.

  4. “…..have major structural parts that have laser-punched rivet holes….”

    Lasers, which have been used widely in aerospace for decades (including for RV parts) do not “punch” holes. The laser essentially cuts them out. Laser cutting equipment provides greater flexibility and lower tooling costs than punch presses and routers, the reason they have become the primary cutting tool in sheet metal fabrication. The problems with laser-cut parts at Vans were not caused by the lasers, but by how they were used.

  5. Vans attorneys were saying they needed at least 70% acceptance or they may have to liquidate. There’s still time as some kit owners have not yet received the quote from Vans. This week will be the decision for them. I certainly hope they get that 70%. It would be a real shame to see this company go away.

  6. I visited VAN’s in Oregon shortly after the 14 made its introduction at OSH. I flew that airplane on a demo flight. Afterwards I was given a tour of the factory and saw the CNC punch press stamping out holes. I remarked to Tom that the next step wold be lasers cutting holes. He said “Oh no, you can’t use a laser for cutting aluminum it changes the temper of the aluminum from the heat generated in the process” I guess he was prophetic in his assessment. They had a VAN’s employee that was aware of the pitfalls of using a laser to cut aluminum.

  7. I hope there’s a burgeoning resale market for the 35%. Keep an eye on the normal outlets, may be some bargains.

    • Remember please, some part sections (ailerons etc) built by those who decide to discontinue their RV project may have laser defective aluminum parts in them. They may not wish to rebuild that part prior to sale, and sell it as is. One would hope they would tell the new buyer, but may not.
      Final inspection by the FCC may create a surprise or two for this new RV builder.
      There are rarely any real bargains in aviation, remember that.
      Let us hope however that there is honesty in any transaction of this sort.
      Trust, but Verify. Caveat Emptor!

  8. The fact that they are resuming shipments seems to be a very positive sign that they think they will survive. FINGERS CROSSED!

  9. Van’s was successful in building a community base instead of just a customer base. I was never a customer, but I saw it and heard it enough to believe it.

    I think it may be what saves them.

    Pay attention would be entrepreneurs. Focus on meeting customer needs and expectations. Don’t focus on a big next quarter.

  10. Have 100 laser cut parts in three rv -8 kits only two parts are unusable the two parts have holes that were melted into the part most parts have no defects. I’m going to use them. I’m on my third rv have built a 4 and 7.

  11. How do incredibly successful companies like Van’s and Boeing wind up committing such incomprehensible errors in management as we have witnessed? Complacency? Hiring practices related to “equity”? Gen Z ineptitude? Has Musk hired all the talent, leaving these “traditional” companies with only the leftovers?

    From Sparky’s comment above –

    “I remarked to Tom that the next step wold be lasers cutting holes. He said “Oh no, you can’t use a laser for cutting aluminum it changes the temper of the aluminum from the heat generated in the process.”

    What’s to be taken from a situation where an issue is clearly recognized by the factory, yet is somehow utterly ignored?

    How does a wildly successful company like Van’s end up going bankrupt?

    How does Boeing, another wildly successful company, green light a trim system that any pilot/engineer would instinctively know is a terrible idea? Or sign off on disposable door plugs?

    At least the Van’s incompetency hasn’t killed anybody (that I’ve heard of). Boeing was extremely lucky that this latest incident happened at 15K instead of 35K . . . and that the adjacent seats were empty. Had they not been so fortunate we would be looking at yet another MAX disaster.

    Maybe it’s a good thing for these scloratic outfits that AI is making an appearance. It appears that with both companies the traditional intelligence with which the companies were built is no longer there.

  12. The company, which filed for Chapter 11 bankruptcy protection in December, announced January 20 that “65 percent of eligible kit orders have been renewed at the adjusted price,” reported to be about 30 percent higher than the price originally agreed to, though at least one customer has reported a much higher number—a 54-percent increase over the agreed-upon price for an RV–10 kit, according to a court filing submitted by that customer.

  13. One customer, Stephen Allcock of Maryland, filed an objection with the court to the company’s move to reject existing customer contracts pending acceptance of new pricing. Allcock’s January 22 filing notes that he received the letter with just over a week to consider the new terms being offered for the $68,476 RV–10 kit that he had paid for in full, at the company’s request, in July. In addition to objecting to the tight deadline, Allcock argued that he, as a customer who has paid in full, should be treated differently:

    “I am objecting on the basis that I am a fully paid-up customer and not someone with just a deposit with [Van’s Aircraft]—I believe that this should allow the court to consider my case differently as I do not owe any further money based on a legally binding contract from [Van’s] with myself for the purchase of kits,” Allcock wrote. “To be clear—I do want to continue building the airplane and I am hoping to continue to do so at the previously agreed price as I am a fully paid-up customer but if for some reason my logic does not work for the court then I will reluctantly proceed with the additional funding request from [Van’s Aircraft] when I can afford to find the additional $36,889.06. This is a request from [Van’s Aircraft] to increase my purchase price by 53.8 [percent]—an outrageous ask in my opinion.”

    While the judge has not yet ruled on Allcock’s objection, bankruptcy law typically allows debtors, such as Van’s Aircraft, to reject contracts that have not been completed, which generally leaves the other party to the contract with an unsecured claim for damages for the breach of the contract. Company officials cited a longstanding practice of selling kits for less than they cost the company to produce among the factors that precipitated the bankruptcy.

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