Paid $1850.00 for a 1946, 85 HP 2 place Swift in 1968. I was making $400.00 /month gross.
Paid $3500.00 for a 1949, 145 HP 2 place ( Temco ) Swift in 1969. I was making $500.00 / month gross
Married, living in a house trailer.
I have known thousands of pilots and not until 1989 did I ever meet a pilot that personally bought a brand new airplane for himself.
Many of my contemporaries hand home made, rebuilt from pre/war small planes, old wore out Cessna 150’s, 1946 Ryan 4 place and on & on. people were still teaching in Champs & Cubs, the commercial & instrument were a separate lic. No tail wheel endorsement needed.
IMO. 70 - 80 % of Gen Av was old planes until about 1980.
A friend took me up in his Cessna 150 when I was about 20, and I got hooked. Oh, I had flown in commercial aircraft many times before, but this was the first time I was in the cockpit (in the co-pilot’s seat, no less), and got to hear the radio traffic and watch the instruments.
Unfortunately, my eyes prevented me from seeking my own pilot’s license. Oh well, I enjoyed flying (many times, as it would turn out) with Doug, in his Cessna 172, which he eventually got. I couldn’t fly, but Doug always put me in the co-pilot’s seat, because I knew more about flying than our buddies in the back. Just in case.
Johnny, you once mentioned the “six-pack” of instruments–on my puddle-jumper flights from Lethbridge to Calgary, on a scheduled-service Beechcraft 1900D, I try to book a seat as far forward as I can, so I can read the instruments while we fly. (Note that on such flights, the “cockpit door” is a curtain, and it is often left open. On good days, and depending on my seat, I can read the instruments and watch the approach and landing through the windshield.)
I hope that GA doesn’t die. It’s the only way those of us who cannot fly can come close to what flying really is.
Many people were shocked that the ‘replacement’ for the 152 would cost $109,500. Then the price increased to $111,500. OK, it’s only two kilobucks more; but they weren’t exactly selling like hotcakes. You could buy three or four 150s/152s for that price. Then Textron raised the price to $149,000. Twenty thousand dollars of that had no justification. Textron just wanted to make more money, so they said ‘Hey, I think we should make an extra 20 kilobucks above the profit we’ve already figured in the price, just because.’
Textron seriously misread their market with the 162 Skycatcher. First, they priced it way above what most personal flyers considered a two-seat airplane similar to a 512 should cost. Second, they released it at a time when most consumers were worried about keeping their houses and jobs, let alone thinking about buying an airplane. Thirdly, even though Cessna managed to build airplanes in the U.S. for decades, and also pay a living wage to their employees, and also cover the pre-GARA liability, and also was able to price them such that even their workers could aspire to own one of their products, Textron said they could not afford to build the 162 in the U.S. I have read several comments from pilots who stated they absolutely refuse to buy any airplane made in China. And then there’s that $20,000 ‘We’re rich, so you have to give us more money’ fee the brainiacs at Textron tacked on.
Either the Textron execs live in a bubble where they think that if their poorer friends can’t afford an airplane, they can just forego the extra yacht and get one; or they are actively trying to kill personal flying (and there are good reasons for them to); or they know nobody is going to buy their airplanes and they are just trying to rake in as much as they can from the corpse.
I think this idea that Cessna is just willy-nilly raising prices on products for no reason whatsoever, other than to make even more money than they are surely raking in, is the real item with no justification here.
I just looked at Textron’s annual report. The Cessna division is clearly the worst performer in the company, posting an annual loss of 1% in 2013 after a meager 3% profit in 2012. In contrast, Bell Helicopter posted a 12% profit in 2013, and the other sectors seem to average around 8-10% profit per year.
It seems to me that what we’re seeing is that the market for this product is just in a routine death spiral: there’s less demand, meaning that costs go up, while the buyers that there are for the product are also demanding more technology (multiple moving maps and other tech to set you back $10 or $20 grand a pop) further raising the cost.
I’m not sure the cost increases are actually an example of corporate greed. If anyone wants a product that is made in small quantities, of course it is going to cost more. I will add that I’m not sure how much liability adds to the cost of a plane, mostly because I am simply not aware of how much litigation Cessna is actually involved in, nor how much they have to pay for insurance or whatnot.
‘Yeah… The bottom line! That’s the ticket!’ He’s saying that their bean-counters, whose job it is to project costs and come up with selling prices, could not forecast the cost of building an airplane just three years into the future. :dubious:
Either Textron is sucking all of the profits they can out of Cessna, or they are incompetent to build piston-engine singles.
Either way, the prices they charge are killing GA.
Textron makes the Cessna. Great airplane, the 172 is the most popular GA airplane class ever - but they don’t have a monopoly on the market. What about a little Piper Archer? Oh, wait, they start at… well, at about $340,000. Why is THEIR price so high? Textron doesn’t own Piper.
Okay, let’s try a lesser known brand, Diamond. What would the equivalent model be? A DA40, I guess, which is HOLY MOLY HALF A MILLION DOLLARS? A USED ONE IS THREE HUNDRED THOUSAND WTF
I mean, there is some sort of economic force at work here. It’s not Textron saying “durr, let’s raise the price.” Everyone’s raising the price. If Piper could keep the price of equivalent aircraft at twice the median salary they’d be eating Textron/Cessna for lunch. There are clearly other forces at work here.
Good point. I remember aviation ads in Popular Science. It might be sort of like how a middle class family today can afford a BMW if they scrimp and save a lot elsewhere. Will it hurt? Probably. Can you do it and not starve? Yes, but I hope you like working a second job and never eating out.
“The number of U.S. households with a net worth of $1 million or more, excluding primary residence, rose to 9.63 million in 2013, according to a new report from Spectrem Group, a consulting and research firm. There were 1.24 million households with a net worth of $5 million or more last year, up from 840,000 in 2008. Those with $25 million and above climbed to 132,000 in 2013, up from 84,000 in 2008.”
So while the middle class have been priced out of the General Aviation market there are vast numbers of the rich who can afford it. Why don’t they buy airplanes? My guess is that owning an airplane is no longer a big status symbol.
Let me be clear: when you said that Cessna just made up a reason to charge $20,000 more for an airplane, I believe you were implying that it was simply because of greed. However, it seems more plausible that they simply were not making a profit as a company, as its annual report states. It is hard to take seriously the comment that Textron is sucking the profits out of Cessna when the annual report shows that Cessna lost $48 million in 2013.
So you’re basically accusing them of destroying GA, but I ask you which scenario is worse: raising prices or going out of business?
Seriously, if Cessna is losing money, what do you think they should do? They tried to cut costs by moving some production to China and that failed. They tried selling the product at a loss, and that doesn’t appear to have worked out. So, the next obvious things to do would be to raise prices or ask for a government bailout.
You helpfully point out that sales of GA aircraft appears to be down by 92% over the past 40ish years. If you’re selling only 8% of the product that you used to, of course prices are going to go up by a lot. That’s just a universal economic reality. I’m just not seeing that the case for corporate greed being a significant factor in the decline of GA holding together at all.
Just one data point, I flew in 152’s, Cherokee 140 and an Archer and got my VFR license in 42 logged hours in the Midwest in 2001 for around $5000 including books, materials and two headsets. I saved up beforehand and dedicated my summer to the project which helped cut down on relearning material, but in all I consider that affordable.
How have the increasing popularity of ultralights affected the price of modern small craft?
Out of curiosity how much do kitplanes (homebuilt airplanes) cost? I realize there can be a lot of variation there but wondering if that will show similar costs increases or not.
Personally, I suspect that airline deregulation and the drop in oil prices after the 1979 oil crisis had a lot to do with it- places that were economical to fly to yourself suddenly became uneconomical relative to hopping a cheap flight on Southwest Airlines or driving there yourself.
The graph that Johnny LA linked to goes from linear to parabolic starting in about 1978-1980, right in line with the deregulation of the airline industry and the lowering of oil prices that started happening after the 1979 oil crisis and that continued through about 2008.
If a company is in business to produce non-corporate class General Aviation airplanes, then I feel that it is incumbent upon them to build and maintain their customer base. They’re not doing it. It’s called ‘investment’. Manufacturers, particularly Textron because they own the most successful line of aircraft of all time, seem to be saying ‘We already invested! We bought the company!’ It seems that they want to make the profits without doing any work. There’s a lot of pent-up demand, and they will sell every airplane they make to meet that demand. B
ut people aren’t willing to pay what they’re asking. (I remember when a lot of people wanted a new T-34C. Beechcraft offered them, but nobody wanted to pay $1.34 million for one and they didn’t sell any.) They’re going to have to take a loss until their customer base is rebuilt. Since they’re not, they are effectively killing General Aviation in my opinion. They at least need to sell their entry-level airplane at a price people are willing to pay, and ramp up the marketing so that people will move up to their more expensive products. The Skyhawk is already well over a third of a million dollars, and the new Diesel-powered Skyhawk is close to half a million. They could also put the 152 back into production under Part 25(?). There is no need to re-certify it under the new standards. AOPA has taken some 150s and 152s and had them remanufactured to better-than-new standards and with modern avionics, and they’re offering them for under $100,000. Surely Textron can put 152s back into production and sell them for $150,000?
A successful businessman has an actual use for something like a Skylane or a Bonanza. The rich who are the only ones who can afford these airplanes would rather use King Airs; or better yet, corporate jets.
I’m interpreting it differently. Yes, that is the bottom of the parabola. Yes, the bottoms of parabolas are not as steep as the other ends. But to me it looks more like a bump in the linear trend. I’m looking at the two points at 1978 and 1982. That part of the parabola actually looks like it is climbing less rabidly than median income. I remember that I noticed the very high jury awards to survivors of plane crashes in that time frame. So what you see as the beginning of the parabola, I see as a jump in the linear trend to compensate for liability. The cost of a Skyhawk in 1987 was 2.05 times higher than median income, which is less than the 2.2 times in 1967. There is no data from 1987 to 1998 because there were no new Skyhawks being made or sold. Perhaps there should be a gap there, as the line makes it look like production hadn’t stopped.
The bottom line is that prices have been climbing at an ever-increasing rate than income. An airplane that sold well when it was twice the median income is now priced at over seven times the median income. Consumers cannot be blamed for not being able to afford a product. It’s up to the manufacturers to invest in their future.
So Textron is obligated to sell products at the price that the public would rather pay without respect to what it costs to build it?
Are you next going to say that Tesla is obligated to sell the Model S for $24,000 because $85,000 is just too much to pay for a car? Geez, it is like Tesla is trying to destroy the electric car market by charging so much!!
I’m saying that a company must invest in its future if it wants to continue selling a product. In order for Cessna to survive, either the buying public will need to pay two to three times what the product is worth, or the manufacturer will need to take some losses to build a customer base that will allow them to achieve economies of scale.
But your opinion on what the product is worth still seems predicated on nothing more than, “It used to be cheaper!” It makes perfect sense that when production goes down by 92% over 30 years, prices are going to go up by a lot. And seeing how other new aircraft from other manufacturers seem to be similarly priced, Cessna doesn’t seem to be overpricing their product.
If Cessna were pricing their product at roughly twice what you think they are worth, why hasn’t some other aircraft company offered a better product at less cost in order to corner this market you think is so important?
Except it’s not. Everything has gotten more expensive over the years. The thing to look at is the price versus income.
In the case of a Skyhawk, which is specifically what we’re talking about, ‘worth’ can be directly compared with previous models. How is a new 172S better than a then-$50,000 172P? Their useful loads are about the same. Their top speeds are the same. They look the same. The 172S has improved ventilation, and it probably has a stronger wing spar. But ventilation is not a major selling feature, and as fas as I know there has never been an in-flight breakup of a 172. The 172S only comes with a $50,000 glass panel, but an older 172 can have a glass panel retrofitted as the owner chooses. In actual usefulness, the planes are ‘worth’ the same.
The number of buyers shows that they are overpriced. If they were less expensive, more would be sold and the cost of production would be reduced.
It seems to me that others are trying to fill the gap. Cessna has, for example, abandoned the training market. Van’s Aircraft produced a limited run of factory-built RV-12s, and they were snapped up immediately. Last year they announced they would produce another run, at $115,000 for the base model and $123,000 fully-equipped. The fully-equipped model is more than $25,000 less than Cessna’s now-discontinued offering. And judging by the turnout at a recent fly-in, Van’s homebuilt models are extremely popular, offering greater performance at half the cost or less than a new Skyhawk. The RV-10 seats four, has more than 60 mph over a Skyhawk, can go 6,500 feet higher, and has a 30% greater range. Van’s seems to have hit the right price-point for the factory-built RV-12, and due to high costs of factory aircraft homebuilding seems to be more popular than ever. Even arch-rival Piper can offer their PA-28 Archer III (similar to a Skyhawk, but a little faster) for $40,000 less than Cessna charges.
So if there’s a big market for these aircraft, why isn’t the RV-12 being sold by the thousands? It seems to be the price that you think the C172 should be at.
You love general aviation and that’s great, but it’s warping your understanding of how businesses work and economics works in general. You want Cessna to sell things for a loss because you just want them to, because allegedly this will save GA. But you can’t explain why other manufacturers don’t simply sell equivalent products (like Piper) for the price you believe is fair, which would eliminate Textron from the market but save GA.
You love general aviation and that’s great, but it’s warping your understanding of how businesses work and economics works in general. You want Cessna to sell things for a loss because you just want them to, because allegedly this will save GA. But you can’t explain why other manufacturers don’t simply sell equivalent products (like Piper) for the price you believe is fair, which would eliminate Textron from the market but save GA.
If the plane’s overpriced, scrape up some money, hire some engineers, and build some planes. You’ll soon be an airplane tycoon.