Value In High-Performance LSAs
Part of my job description is to hang around people who sell airplanes, or try to. In Cessna’s salad days, the company clearly knew how to sell and it helped that the market was ready to absorb thousands of new airframes. Now, not so much. The definition of a circular argument is to ask whether airplane sellers simply don’t know what they’re doing anymore or if the market just barely exists. (I think the latter is more true than the former.)
Still, I see airplanes that ought to be selling better than they are and these are, almost inevitably, light sport aircraft. It’s fashionable to bash light sport as a failed idea but I’ve never subscribed to that claim. It’s just a modest or even lukewarm niche in a larger market that is itself flat. But it’s still a market. Consider this as a value comparison: Last year, Cirrus sold more than 300 airplanes whose average price was in the high six figures, closer to $1 million than not. It’s obvious that those 300-plus buyers saw value in spending that much money for an airplane to whisk them along at 180 knots for $75 an hour in gas. Cost per mile, absent every other consideration save gas: about 42 cents and 10 MPG. (Add the insurance, maintenance and so on and it’s a lot more, but I’m being a simpleton here for a reason.)
Now let’s dial back our expectations to a pair of light sport airplanes I’ve recently flown that I really like. The Bristell NG5 and the Tecnam Astore. Without going into detail, both of these airplanes are similar in that they’re sporty looking and performing and at the very top of the LSA speed performance envelope and, in fact, beyond the 120-knot CAS limit. I’m pretty sure either one of them could be tweaked up to reach 130 to 140 knots. You can argue among yourselves whether this tarnishes the original intent of the light sport rule. Personally, I don’t care. It was an arbitrary consideration anyway.
This means that these new airframes—with avionics nearly as sophisticated as those found in the Cirrus, at a fraction of the cost—are really modest traveling airplanes. The Bristell carries six hours of fuel and has generous baggage space. It cruises at about 118 to 120 knots TAS on 4.5 GPH. That’s 26 MPG and about $12.50 an hour in fuel, if you use autogas, which the Rotax engines are happy with. That works out to a dime a mile, less than a quarter what the Cirrus costs. The Bristell and Astore invoice in the $180,000 to $210,000 range, depending on options. Most buyers option them to the max because stripped-down airplanes were never popular except when flight schools bought a lot of them.
So, the bottom line is that these airplanes cruise at two-thirds the speed of a Cirrus, cost one-fifth (or a little more) as much and burn one-quarter of the fuel. By definition, a value judgment can’t be made in a vacuum; it has to be compared to something else. I submit that either of these two airplanes is an impressive value against a new Cirrus or even an Archer or a Skyhawk. They both do a lot for a lot less money and I’m not so sure the LSAs aren’t a little faster than the Cessna and Piper.
So where the hell are the buyers? Why isn’t there a subset of moneyed customers who either can’t afford a $900,000 Cirrus or choose not to, but who can afford to write a $180,000 check for a new, capable LSA? The answer isn’t obvious, but the fact is, that subset exists, it’s just spread out over dozens of manufacturers. Hard data is elusive, but in the U.S., about 200 light sport airplanes a year are sold, a little better than 20 percent of the total new piston market. Worldwide, the number is much higher. On its face, the comparison may seem preposterous; Cirrus buyers are just different strata.
Sure, but the strata are merging a little. According to Tecnam, some of their buyers are stepping down from more capable airplanes and not just for medical reasons. They recognize that their needs don’t justify high-performance singles or twins. A Bonanza or Twin Cessna is just too much airplane for not enough purpose.
So why not more buyers? The wealth is certainly out there. There is definitely disposable income and people willing to dispose it. What causes a would-be buyer to not see value? One reason is that you can get a capable, well-equipped legacy single like a Bonanza or a Mooney for $100,000. It will cost three to five times what the LSA will to operate and maintain and you’re ever exposed to the Big One—a $7000 annual or a $30,000 engine you didn’t expect. Not so with the LSA, or less so. Or buy used Skyhawks all day for $50,000 and just fly a rundown piece of crap and be happy.
Are two seats the deal breaker? Probably a factor, but it shouldn’t be, since not many people who own four-seat airplanes fly trips with more than two people in the airplane. Evidently, people want the back seats and they’re willing to pay a lot to have what they rarely use. It’s a just-in-case mentality.
Lack of IFR? This is both a real and artificial constraint. If you’re going to Sun ‘n Fun or AirVenture, take a few minutes to really look at Garmin’s G3X Touch or the Dynon Skyview. Compared to a full-up G1000, the value comparison is ridiculous. These systems now do nearly as much and have capable autopilots that include envelope protection. The fact that the airplanes they’re installed in aren’t approved for IFR is one of those regulatory absurdities that defy rational thought. In fact, the Astore is approved for IFR operation, just not in IMC. Bristell is about to approve that, too. So when presented with the moral quagmire of turning around or busting one of these airplanes through an overcast to get on top, what would you do? I know what I’d do.
The redundancy is there, too, and so is the ultimate backup: a ballistic parachute. In fact, more LSAs have this option than do new certified piston singles. The glass panels are equipped with battery backup and when I flew the Bristell with Lou Mancuso last week, he had it festooned with tablet-based nav and attitude backups out the wazoo. So the airplane would be perfectly suitable for cautious IFR. (No icing; no convection.)
So what keeps me from buying one? I’m actually thinking about it, to be honest. I could probably afford sole ownership of a $180,000 new airplane, but I’d prefer to have a couple of reliable partners. The airplane would fly more and that bodes well for maintenance and durability. Of all the machines I’ve owned in my life, I’ve tended not to buy new ones because the depreciation factor is unappetizing and I’m a cheap screw. But at least I no longer recoil at the thought of something new.
I wonder if one reason more of this type of aircraft isn’t flown is because they’re built by what is essentially a network of cottage industries that don’t have proper marketing and sales forces. They depend on word of mouth, exposure at shows and the odd press review, plus hit-and-miss social media efforts. (Maybe.) That's another way of saying Cirrus has a pedigree, Bristell doesn't. More than one reader who has seen detailed reviews or actually looked at these airplanes has remarked on their surprising capability and economy, as in, “really, I had no idea.”
Could a company willing to invest in a sales force sell enough to justify the investment? If Cirrus finds 300-plus million-dollar buyers, can’t someone find 150 under $200K buyers? Someone would have to invest to answer that question, but would-be buyers won’t buy if they don’t know what these airplanes can actually do.
Of course, if all you do is bore holes in the sky, you’re probably better off with a cheap legacy LSA or even a certified airplane. There’s no point in buying this much capability just to have pretty glass to fool around with. I actually do have need for an airplane capable of a reasonable 500-mile cross country. Makes me wonder if I’m talking myself into something here.