Sunday, September 21, 2008

Where was Perry Mason?

The hearing lacked the sharp edge of a Perry Mason trial. The transcript for DOT's Inspector General Calvin Scovel's findings (and presumably the other witnesses as well) was available days in advance of the hearing. This allowed the FAA to be prepared to respond to the charges being leveled at them which in fairness, kept the hearing focused on the issues at hand.

For instance, when Ron Wojnar, the FAA manager who gave the go ahead to grant Eclipse the Production Certificate was asked about the 13 open items at the time of the issuance of the PC, he was able to blunt the inquiry by saying, "well a couple of the items were related to FAA action items, things that the FAA needed to do, like schedule an 18 month quality audit."

But where was Perry Mason to ask, "What about the other 11 items? How many of those were flight safety critical?"

Or John Hickey, Director, FAA Certification, justifying the date set for the Eclipse type certificate on September 30 because an agency goal was to certify a Very Light Jet during that fiscal year.

Where was Perry Mason to ask, "John, at the end of September your agency goal was to have a Very Light Jet certified. Why push the Eclipse program? You already had a Very Light Jet certified, and probably with no IOU's, the Cessna Mustang three weeks earlier."

Both sides made their points largely unchallenged. Nicholas Sabatini, FAA Associate Administrator for Safety under oath could say:

"I believe the Aircraft was properly certified. I believe that the aircraft meets FAA safety standards and I have the results of a Special Certification Review Team to back me up on that."

Of course the Special Review Team did not review the complete certification, they only spot checked certain areas during their 30-day rush to judgment but nobody reminded Sabatini of that fact.

Or when John Hickey testified:

"On the date of September 30, the FAA team made two determinations. They determined the Eclipse 500 had complied to all appropriate regulations and it was in a condition for safe operation."

Nobody asked him about IOU's that even Vern Raburn acknowledged existed at the time of the original TC.

OK, so it wasn't a trial - it was a hearing. Both sides made their case with little or no cross examination and it matters little as to what was said in the hearing. It was only a small window as to the discovery obtained during the months of investigation by Scovel.

Only a few witnesses testified. Scovel talked to many more as did the staff from Oberstar's committee. And what they heard painted a very ugly picture, not only of the FAA's transgressions but of the operation of Eclipse which was not part of the inquiry.

It was little wonder then when the presiding chairman of the subcommittee Congressman Jerry Costello opened the hearing with a serious indictment:

"I am extremely disappointed that the FAA again lacks the ability to oversee its programs, in this case its certification programs. Unfortunately, this hearing will expose an agency that is as interested in promoting aviation and befriending manufacturers as it is in carrying out its number one responsibility of protecting safety and the flying public.

It is inexcusable and unacceptable to ignore rules, regulations and standard practices to accommodate those you have a responsibility to regulate -- when you have people's lives in your hands! This Subcommittee, the Congress and the American people entrust the FAA to uphold the highest level of safety. Unfortunately, the FAA conduct regarding the certification of the EA-500 makes one lose confidence in the agency."

Or Chairman Oberstar's written transcript:

"In the Eclipse case, it appears that when design deficiencies were identified that appeared to be non-compliant with FAA certification requirements, senior FAA management became personally involved, overruled lower-level engineers and inspectors, worked diligently to find "work-arounds," to find "alternative approvals and rationales and techniques." and to accept IOU's for later compliance. In many ways, the certification process in this case was conducted "backwards" from the clear intent and requirements of FAA certification regulations. Instead of certifying on the basis of safety alone, FAA senior management appeared to be highly motivated to find ways to explain why design deficiencies identified by FAA engineers and inspectors as "unsafe" were indeed "flawed" but they were still "acceptable for certification" by simply changing the approval criteria."

Both chairs had heard enough in advance to convince them to hold the hearing and get the evidence into a public forum. The written statements by the Inspector General, DiPaola and the four safety inspectors from Ft Worth contain far more detail and disturbing accusations then what they could state in their brief oral summaries. Fortunately, their written transcripts are on record for everyone to see.

Since there was no trial, there was no verdict. Had there been one, John Hickey would have been terminated on the spot and Nicholas Sabatini certainly sent on to early retirement. But that is not the way Washington works. Congressman Oberstar has been around Washington a few years. He knows where all the levers are, how to pull them and when. As one who controls the FAA's budget his influence is enormous.

Sabatini too, has been around long enough to read the tea leaves and will probably depart on his own. When? Soon, but not too soon to look guilty. Shortly thereafter, Hickey might feel that fatherly arm of Congressman Oberstar around his shoulder and hear Oberstar's soothing words, all while being escorted to the door. "Goodbye John, you did a heck of a job."

A good friend put this together for me, this past week. Clearly, DayJet's effective closure is another matter which merits a full headline, but this is the Eclipse Aviation Critic blog, so I thought the DOT IG hearing merited more focus.

I was otherwise engaged. I have been in very brief contact with some of you, who know why. My father, Brian Price, died suddenly while on holiday in France last Monday morning, the 15th of September. To quote the final paragraph of what I said at his funeral yesterday:-

"Let us all remember Brian in our hearts and our prayers. He was a rare individual, a loving husband, a kind and caring father, an intelligent and skilful lawyer and a great friend to us all.

May he rest in peace."

Shane

622 comments:

«Oldest   ‹Older   401 – 600 of 622   Newer›   Newest»
fred said...
This comment has been removed by the author.
fred said...

Joe Patroni :

excellent post !

i think you summarized very well the history ...

for me it has always been :

amateurish funds lenders fooled by amateurish planes builders making aircraft for amateurish Jet owners ! (nothing pejorative into it ...there is nothing bad being an amateur ...as long as you remember about it !)

you see , since i work in project-related environment , i found out a few trick to see where things add-up or not ...

the first one is discrepancies (if you have many version of the same project = which one is the good one , probably none !)

the second one is how to sort-out amateur from pros (or anyone really up to what he does) :

usually a real pro is not going to tell you "how easy'n sure it's gonna be ..."

look at sports : when you see it on TV , it look so simple ... why aren't peoples more high profile sport person ? because it is NOT easy !!

fred said...

baron & freedomjam

# Baron95 is right, consumers do the weirdest things.
Vern even found people who were willing to buy a stake in his kool aid factory.#

i would venture consumers are led to to do the weirdest things ...

only a result of "Bigger,Taller,Stronger" ...

if you do not put yourself a limit to your "B+T+S" , you're sure to be played to push the madness a little further ...

whether from someone inside (making $) or outside ... it doesn't matter !

then it become easy to explain wars , unrest , economics downturn , etc ..

FreedomsJamtarts said...

Fred wrote the second one is how to sort-out amateur from pros (or anyone really up to what he does) :

usually a real pro is not going to tell you "how easy'n sure it's gonna be ..."


When going into a test, people are usually very confident if they are either:

1/ Excellently prepared, or

2/ Absolutely clueless - so ignorant that they don't even know what they don't know.

More normal is to go into something with a feeling of insecurity because you know enough to know you don't have all bases covered.

The bloggers will make up their own mind of Verns approach to Eclipse.

We know Cessna used all their resources and experience decided the their share of the VLJ market was worth about 50-100 A/C per year, but hey, what do they know?

fred said...

freedomjam :

#More normal is to go into something with a feeling of insecurity because you know enough to know you don't have all bases covered. #

YES ...!

in fact , whomever is confident enough , knowing enough , AND successful at the same time are PURE GENIUS ...!

but it occur extremely rarely !

when something is extremely well prepared = don't forget about Murphy's law ...

someone very(too?)confident is often completely lost whenever things do not happen as planed ...

as for the clueless , no need to explain !

someone normal , even if not showing it much , would normally be a "bit shaky into his own pants" (starting by me ...:-)) )

i am not saying it is perfect , but very good to "smell" around if there is any interest of digging any further ...

airtaximan said...

I find myself thinking:

In a perfect world, EAC would have understood the market is fragmented below $4M... the previous new small jet entry price.

I could see 3-4 products in the EAC family
$1M single
$1.5M 4 plce twin (faster)
$1.9M 6 plce twin (faster)
$2.8M 7-1 8plce twin (faster)

All using common systems except engines...but could stick with PWC... all using common fuselage... just grow... simlar wings, except perhaps swept wing for 8 place.

Perhaps could have gotten to 400 -500 units per year or so...

Just dreaming of course....

fred said...
This comment has been removed by the author.
fred said...

no airtaxi ...

you're not dreaming ...

EAC could have been successful IF

1° they didn't miss the target by THAT much ...

2° they would have more than one product to sell (but finished ...!)

this is probably going to be one of the biggest drawback in Russia ...

they will understand very fast that the price-argument doesn't stand , if a potential customers is not delighted with what they propose , nothing to be instead ...!

they could have proposed an other version with smaller passengers seats ( for jet-lover only) at a reduced price (while keeping this price really at expected level)

an other one with bigger capacities ...

and an other one much faster ...

if they didn't foolishly tried to show the world , they were right into re-inventing the wheel (Ea500 and its pseudo-airtaxi capacities )

they forgot about a simple rule :

try to please EVERYONE , you'll end-up pleasing NO ONE !

Dave said...

Eclipse defections:
Preceding Brown out the door were Dewey Colvin, head of the avionics integration lab, and Steve Krattinger, a top Avio harware and software development guru. Many other key players soon may follow.

"We have a very small company," one company insider told AWST. "There's so much tribal knowledge evaporating right now, it may be very hard to undertake certification of Eclipse 500 upgrades in the future."

http://www.aviationweek.com/aw/blogs/business_aviation/index.jsp?plckController=Blog&plckScript=blogScript&plckElementId=blogDest&plckBlogPage=BlogViewPost&plckPostId=Blog%3A2f16318d-d960-4e49-bc9f-86f1805f2c7fPost%3A53f3e94b-5b24-40e8-8040-b8b8788620f4

julius said...

Fred,

bon jour!

Maintenant tout le monde sais que cette societee est un vrai gouffre. Mais M. Roland P. essay de gagner du temps pour...

Obviously, anyone who is
- paying 200 M$ for 2008 operations
- paying 300 M$ for 2009 opertaions

to get positive operational figures in 2010 must be very crazy .

The numbers are wrong or a new financing round never took place?

Is EAC already a training center - as long as material is in stock?

Anyhow, deposits for the FPJ and the Frankenstein are welcomed!

Julius

Black Tulip said...

Dave,

Not good news for Eclipse. I met Matt Brown at the Eclipse booth at last year's NBAA - he is an impressive young man and I suspect many customers were counting on him.

fred said...

grüss Gott , julius

yes , it is a financial nightmare ...!

but don't forget that they need an other 200/300 for 2010 as well ...

when the building will be finished (almost strange to say "finished" talking about EAC) they will need to start producing and then delivering ...

it is not a car , you don't put yourself in the seat , ignite engine and go off ...
(just a little bit more complex than this ...)

so i wouldn't bet on immediate cash-flow in sufficiency to stop digging a hole in Fort-Knox ...
(but as freedom said : what do i know , humm ?? )

a nightmare ...i tell you !

fred said...

you see it is the same than the "Credit Card Story" with DayJet ...

i don't know enough about this topic in USA ...

but i am quite sure that in Deutschland or in France , that would be considered as "insurance defrauding" (credit card are automatically insured )

leading probably too have many questions to answer in Police Station ...

if not putting you straight behind bars , until things are sorted-out ...!

fred said...

to follow-up on the joke :

99 Kriegsminister
Streichholz und Benzinkanister
Hielten sich fuer schlaue Leute
Witterten schon fette Beute
Riefen: Krieg und wollten Macht
Mann, wer haette das gedacht
Dass es einmal soweit kommt
Wegen 99 Luftballons

!!!

Shadow said...

Oh, now I get how Roel expects to get the $200 million to float Eclipse!! He bought one of the Euro lottery tickets. He's a guaranteed winner, right???

fred said...

shadow :

on a statistics point of view , there is 38 times more chances to see a meteor of more than 2Kms wide crashing on earth , thou ending the reign of Mammals ...

than to win once in an average lifetime ... ;-))

Dave said...

Can someone explain to me Eclipse's proposed production methods with these two plants? It sounds like Eclipse is going to be sending out kits from ABQ and then aircraft will be built on a conveyor. Here it is about the conveyor:
http://translate.google.com/translate?hl=en&sl=ru&u=http://www.rosbalt.ru/2008/9/24/526538.html&sa=X&oi=translate&resnum=2&ct=result&prev=/search%3Fq%3D800%2B%2522eclipse%2B500%2522%26num%3D100%26hl%3Den%26lr%3Dlang_ru%26as_qdr%3Dm
So ABQ is going to have to receive parts worldwide and then build and kit and send that off to Russia. For Russia to reach 800 units per year, it will mean ABQ must create 800 units per year. This seems like a logistical nightmare and also if ABQ is building the kits for Russia, when do they have time to build aircraft for the US? I'm trying to understanding having a wing sent from Japan to the US and then to Russia. It seems expensive doing kit builds and certainly time consuming to be sending parts half way around the world and then half way around the world again. I know it is hookey, but I'm trying to see if I understanding what Eclipse is saying their theory is.

fred said...

dave :

yes , it's crazy !

but if you can explain HOW a product that couldn't make a dime of profit in a first plant ...

could make some more profits , if you add more (much more) handling and build processing over two plant distant each other of ten thousands kilometers ?

and what is going to be the certifying body ?

with the due diligence EAC has shown already in cooperating with such entities ?

last time , it was ONLY one (FAA) , what's going to happen when it is going to be 2 or 3 (FAA , EASA , RU ) ?? taking into consideration they have different rules , different aim , different way of dealing with things , etc ???

fred said...

i forgot , if you can explain :

i offer you ONE full year of vacation , anywhere on earth , with your family (if married) or girl-friend or i will provide a Russky Dievouchka to your liking ...;-))

Shadow said...

Fred, but Roel SAID he was a guaranteed winner of this lottery. So it HAS to be true, right? ;)

fred said...

shadow :

he said : it is true ?

Alleluia , then ;-)))

TBMs_R_Us said...

Dave,

You post so many great links!! Why don't you put them in your posts as links to make it easier to read and use?

Just use this:

<a href="http://news.google.com">Google News</a>

Which would yield

Google News

Thanks!

Shadow said...

Besides, I think Roel's chances of finding more funding for Eclipse from investors to be far less than "38 times more chances to see a meteor of more than 2Kms wide crashing on earth". So the lottery is probably his best option at this point. :)

Dave said...

OK TBMS here's the link to Eclipse talking about the Russian plant building Eclipse 500 as "kit type":
To maximise economy of scale, Eclipse plans to use as many existing suppliers as possible on the new aircraft, with the exception of new vendors for some structural components, which Raburn says could be announced in mid-2009. He adds that a "kit type" assembly line similar to what the company is planning for the Eclipse 500 in Russia starting in mid-2009 could also be applicable to the new aircraft. Eclipse plans to begin delivering the personal jet in late 2011.
FlightGlobal: Russian Kit Type Eclipse 500

fred said...

dave :

i followed your link ...
something amused me ...
i know , i am still a kid-like , almost nothing amuse a lot ...

so when i read in your link

"FlightGlobal ... SERIOUS about aviation "

haha hahah ...!!!

(sorry in advance for any supporter of the said FG ...)

Formerly known as "Just zis guy, you know?" said...

Cessna thinks their share is closer to 150/year. Pretty sure this is public info.

Honda will be later than most think but will be a real competitor. They will take their time and figure out how to do things right. This is going to be quite a learning process for them but one which I suspect that they are willing and able to take on. I have a great deal of respect for Honda engineering, but building an airplane company from the ground up will be difficult, even for them.

Embraer is going to surprise people with how many Phenoms they make.

Joe Patroni said...

Just some rambling, possibly incoherent commentary.......

-Fred......I've never been to Europe, but , from what I know, the operating environment is completely different there. Taxes, for one thing. And operations over there seem to be more "regimented" there (a Part 91 operation over there is like a Part 135 op over here). For ops inside Europe, speed and range do not seem to be as much a priority as payload/passenger seats and fuel burn. The rationale almost being "Why use two engines, when one big one will supply the same power, but will burn less fuel?" The basic illustration of this being a King Air vs. Pilatus PC-12 comparison.

With the current state of the art and reliability of turbine engines, IMO it's hard to justify that second engine on any personally flown airplane.

As Ron White says, that other engine will "take you to the scene of the crash......which is pretty handy, because that's where we are heading ......" :)

-Honda Jet......the jury is still out on how much of the market will pay a premium price for the extra cabin room created by the semi-unconventional engine location.

Also, an interesting contrast (when compared to Eclipse) on how to start an airplane-building company from scratch, by a company where the engineers actually get listened to.

-Just my personal observation (from 30 years in the corporate jet fixing business), but two groups of people typically make the call on what jet the company will buy......

Either:
A) -The suits/beancounters (who look at the price, then at the gee-whiz stuff aft of the entry door),

or

B) -The flight department pilots/mechs, (who are worried about the stuff in the cockpit,fuel burn and how often the airplane needs fixed/inspected).

Generally, things work out better when B) gets to make the call.

Most corporate types will pay a premium for an airplane with dispatch reliability, and (if they do not have their own maintenance department), the ability to call an 800 number to get AOG support 24/7/365. Nothing makes an airplane go away faster than being broke when it is supposed to fly.

Example: When I worked at Brand "C", one of our regular customers called us @ ICT at 9:30pm......his aircraft was AOG at a fuel stop in SLN. Aircraft owner was in the back of the aircraft, on his way to West Coast to give speech at convention next morning. We grabbed the parts he needed, drove to SLN, fixed aircraft and he was on his was by 0100.

They subsequently ordered a new C750.....because of the demonstrated AOG and customer support

(No, I didn't get a commission from that sale.....)

fred said...
This comment has been removed by the author.
fred said...

joe :

don't apologize for never been to Europe ...
if you had no desire to be there or anything to do , why should you in the first place ?

but i see that you understand a simple fact = " it may be different there ..." which is good !

#Also, an interesting contrast (when compared to Eclipse) on how to start an airplane-building company from scratch, by a company where the engineers actually get listened to. #

how disruptive that was for a concept ...! ;-))
it is truly amazing to see a startup where Marketing (would be ) experts are not trying to teach engineers what is possible and what is out of technical possibilities ...! ;-)

i don't have any business experience of aviation as somebody working in this field ... i am merely only knowing that 1 + 1 = 2 (most of times !)

but if i would be asked about your propositions A or B ...

i would jump on the B !

service to customers and reliability are of such great importance ...
i usually do not take Jet , because it is too expensive as well as i prefer to arrange my work for not having to rush from complete opposite part of earth ...work can wait , while is a bit difficult for life to be put on "Hold"

the last time i took a jet ,was in Russia , nothing was going to the place i was trying to reach (by nothing i mean : plane not old to the point you have to write your will before boarding ...just in case !)

service was excellent , plane perfect , apart the fact that flight attendant should have been dressed a bit shorter (but that is an other story ...;-)) )

the bill was ok for such service !

whenever i need to do it again , i will fly with them !

i don't really understand peoples who want to play in the "big guys yard" but only with a handful of coins ...! (=trying to buy a value-jet ...)

Joe Patroni said...

fred......I may make it to Europe one of these days.......my current problem is that I have two daughters that think I have a "Money Tree" the size of a Sequoia growing in my backyard.

But I digress...... :)

You touched out something that some people (mainly Ivy League MBA types) seem to miss:

"It is better to have 3 people who KNOW WHAT THEY ARE DOING work a given project, than 10 people who don't"

I suspect some Harvard MBA math of this type may have gone on at Eclipse:

"If it takes 12 engineers a year to design something, it will only take a month if we throw 120 engineers at the problem!!!..... Where's my Golden Parachute???"

This rarely works in the real world.

Looking back, most of the really GREAT airplanes had a small number of people involved in the design and/or construction of the prototype.....something like 20-30 for the Lockheed P-80, something like 100 for the A-12/SR-71. As I recall, it was some number less than 150 for the C-750.

Which brings up another aside.......didn't Eclipse claim that it would only take five days for them to assemble and deliver an airplane, from the time the subassemblies showed up, to the time they handed the keys over?

Anyone who has ever done functional tests on a new avionics installation, or had an airplane painted, got a real belly laugh out of that one.

They should have forgotten about the airplanes, then patented and sold the koolaid.

Dave said...

I've been reading this book about engineering disasters and though it shows a book on the cover, it isn't specific to aviation. It is called Inviting Disaster and it has been a good read so far:
Inviting Disaster@Amazon.com

Dave said...

Here's a detailed article on Eclipe talking about their purchasing/production process where they include talk about producing an FPJ in five days as well as making 4 FPJs per day:
Purchasing Magazine Article On Eclipse
Eclipse's whole model is all about having high inventory turn over and high production rates. Given what Roel has said, Eclipse still is unwilling to change their model even if there aren't any buyers even if they could manufacture as many as they say they are going to.

Shadow said...

From the Purchasing mag story: "Bonder believes that Eclipse has developed "a very solid" cross-functional supply chain team that extends past the four walls of the company's facility in Albuquerque to its supplier base."

I think the writer meant to say "disfunctional" instead of "cross-functional"

Dave said...

I think the writer meant to say "disfunctional" instead of "cross-functional"

No kidding. Bonder worked for Dell previously. Much as how Eclipse likes to say that computers and jets are the same thing from a production standpoint, they aren't. There's a world of difference between a stationary PC and a high speed vehicle designed to travel miles high in the air.

Seeing what we've heard about what had gone on at the factory and how Eclipse tried (and succeeded) to stop FAA inspectors from conducting thorough inspections because they slowed down the line, it would seem that Eclipse's production rates couldn't be met because unlike PCs, regulators have to have time to inspect the aircraft. Amongst many other things that Eclipse didn't factor in, it sounds like they didn't figure in FAA inspection time (and it sounds like they still don't want to) when calculating production rates.

Productionman said...

"Amongst many other things that Eclipse didn't factor in"

They didn’t factor in Vern hiring an idiot into the position of vice president of manufacturing either… When is the door going to hit this bush-league, arrogant, over-employed narcissistic butt-head in the ass……? And the paycheck keep getting cashed……….

Shane Price said...

Snippet time....

The 27 'ex' DayJet's at Gainsville are stuck there, until EAC finds the money to move them. Yeph, they belong to Roel, as Vern gave the finance company a rock solid buyback on that one.

Another Vernastic decision....

Brian Skupa was fired for telling the truth. I now have excellent, cross referenced sources for this one.

And I now have offers of documentary support for any customer who seeks redress via the courts. You know how to contact me.

The 'real' order book is now shot full of holes. It's getting very, very hard to extract the '60%' money, as numbers of position holders are now prepared to walk away from their deposits rather than commit more money.

s/n 266 is now scheduled for delivery AT THE END OF THE YEAR!

That's right folks, it will take three MORE months to finish the aircraft that was displayed at Oshkosh.

Enough with the 'lightweight' stuff. I'm brewing up a new post.

And I'm NOT in a good humor. Too many people still getting fleeced by these gangsters.

Shane

Dave said...

The 27 'ex' DayJet's at Gainsville are stuck there, until EAC finds the money to move them. Yeph, they belong to Roel, as Vern gave the finance company a rock solid buyback on that one.

So Eclipse was the guarantor for the company who provided the $140 debt financing to DayJet? It looks like DayJet and Eclipse were closer than we even knew.

The 'real' order book is now shot full of holes. It's getting very, very hard to extract the '60%' money, as numbers of position holders are now prepared to walk away from their deposits rather than commit more money.

So now it isn't just those seeking refunds, but those also who would walk away from their $150K+ rather than put down even more on an FPJ. No wonder Roel is saying there will be 2300 orders in Europe.

airtaximan said...

hmmm,

so, airtaximan was right again?

the BNAK, backed with EAC guarantees, reposessed the plane. Now they blong to EAC... AFTER EAC agreed to make up the difference on the residual value guarantee?

Everyne should take note.. not only did Ed have a sweetheart deal with almost no deposit money... he has a residual value guaranteee, on liquidation, repossession or resale.

Now, THIS is impressive.

NOt if yu are a lonely individual owner/position-holder though.

airtaximan said...

remember, I said... careful... these are sister companies...


Vern and Ed were cleaver: bolstering eachothers BS...

"So Eclipse was the guarantor for the company who provided the $140 debt financing to DayJet? It looks like DayJet and Eclipse were closer than we even knew."

I sincerely believe the incest goes further - its the only explanation beyond shear stupidity why anyone would enter into this relationship...anyone..

eclipso said...

Shane,

I think with all the information this blog and you have, there has GOT to be a way to get most (if not all) of these depositors, vendors, etc. together in one forum to assemble a class-action suit. I believe Vern is still up to his neck in this scam and hope for the one's responsible to be investigated for fraud. (Federal, State and Local)

Dave said...

New SIC minutes are finally posted:
June
August

Dave said...

Both jet and props are filling in for DayJet's locations:
"Affected passengers will be able to contact the air taxi carriers in the region for support, ticket price matches and/or air taxi flight discounts and on-demand flight service available from all 60 communities that DayJet served," the release stated.
Two more air taxi companies offering service in Middle Georgia
This just shows that DayJet was poorly run rather than it being credit crunch issue.

Baron95 said...

Amateur vs pro investors/entrepeneurs discussion that Fred started... Give me a break!!! Do you guys really believe this stuff?

The Klapmeyers were just as much amateurs as Vern = different results (at least for now).

Bill gates was an amateurs at creating a SW company.

The boys running Lehman were the ultimate pros - The CEO just saw 99.5% of his personal fortune of $775M evaporate.

The google boys were not only amateurs they were young and unprapared to run even a car wash.

Amateur vs pros is not determinisc of success or failure AT ALL. When it comes down to it, it is all up to the individual, the people he/she surrounds him/herself with, being a bit lucky (on timing, biz cycles, finding investors, etc), and constantly adjusting and innovating.

I am anxiously waiting for the next amateurish and crazy SOB that pours another $1B trying to shake up GA. I fully expect that 8 or 9 out of 10 will fail, but that is how it goes.

Baron95 said...

Preceding Brown out the door were Dewey Colvin, head of the avionics integration lab, and Steve Krattinger, a top Avio harware and software development guru.

Thank god - 10 freaking years and those guys haven't been able to produce an avionics suite that has AP coupling, GPS or moving map. There is no excuse for this. It was not Vern's personality or anything like that. These guys had the money, they had the time (after the engine delays), yet they produced nothing.

Knowing what I know (and I don't know them personally), I would not hire these guys if they were the last avionics engineers in the world.

Baron95 said...

Fred said ... if not putting you straight behind bars , until things are sorted-out ...!

Fred, this may be a strange concept to you, but we don't (usually) put american citzens in jail while we sort things out on a minor financial transaction.

You guys are making too big a deal about this cc item. If DayJet ceased operation, that is it, they ceased ops. There should be no phones, no-one on the payroll to process refunds, nothing.

The cc company most likely has not made payment transfers to DayJet as these take about 30 days, and charter flighs usually don't have reservations that far in advance.

For all 10 or 12 customers that have made a reservation with a cc, it is a simple issue of disputing the charge (usually by email or fax), the cc company will remove the charge and not send the payment to DayJet.

Would it have been better if DayJet itself sent the charge reversal? Sure. But things are messy when companies fail. Just ask about how the passengers holding Eastern and Pan-Am tickets fared when they went Tango Uniform.

You guys latch on to such silly details. Ed had an idea. He tried it out. It didn't work. Next.

Dave said...

I am anxiously waiting for the next amateurish and crazy SOB that pours another $1B trying to shake up GA. I fully expect that 8 or 9 out of 10 will fail, but that is how it goes.

I wouldn't expect it to be that high and right now Eclipse is the only thing we have to go by. Eclipse has permanently fixed itself upon a business model based on unrealistic volumes. You give someone a billion dollars and fix their business model at 100 units per year, you'll do a lot better than spending 10 years and $1 billion dollars based on an output of 1000 units per year. Eclipse could be doing better if they changed their business model away from the high volumes and it is a decision they made to bury themselves further into high volume rather than back away from it.

Baron95 said...

Joe,

Here is how a startup company can make it.

1 - Focus on the concept/high-level design/marketing financing.

2 - Outsource training to FSI (building certifying sims, training curriculum, etc).

2 - Outsource service, AOG support, etc e.g. to Signature Flight Services parent company or Embraer or whatever.

3 - Outsource out-of-geo sales and even in-geo sales (like Honda is doing with Piper).

4 - Line up experts (preferibly on ris sharing) to do detail design and source the major sub assemblies (Garmin, Spirit, etc).

5 - Do final assembly or even outsource it.

Now keep your eye on the ball - selecting and managing the best partners, handling your CRM and customer communications, marketing, raising money.

This is how new plane designs will be brought to market from startup companies like Aerion (long-shot) or Honda (Jet), etc.

When you are up and running as a company, you may choose to bring things in-house later on.

ColdWetMackarelofReality said...

Baron,

I know the guys mentioned in the article, except for Matt Brown they are good folks with real experience.

You are wrong, it was Vern's persosality, and the resultant direction given that created the problem, moving targets, inadequate focus, and poor marching orders cannot be overcome by even good people.

Dave said...

You guys are making too big a deal about this cc item. If DayJet ceased operation, that is it, they ceased ops. There should be no phones, no-one on the payroll to process refunds, nothing.

That is the way it should be, but it isn't. That is why we have "latched on" because the execs are still getting paid and are jetting around on the customers dime.

The cc company most likely has not made payment transfers to DayJet as these take about 30 days, and charter flighs usually don't have reservations that far in advance.

Eclipse actually has instructed people to order flights no more than 60 days in advance for certain things, so not only does DayJet get have orders 30 days in advance, but they have orders 60+ days in advance.

For all 10 or 12 customers that have made a reservation with a cc, it is a simple issue of disputing the charge (usually by email or fax), the cc company will remove the charge and not send the payment to DayJet.

By what basis are you arriving at that DayJet only has around a dozen refunds outstanding?

Would it have been better if DayJet itself sent the charge reversal? Sure. But things are messy when companies fail. Just ask about how the passengers holding Eastern and Pan-Am tickets fared when they went Tango Uniform.

Yes, you are talking about BK, which DayJet is NOT in BK. DayJet is spending just not their own and they aren't in BK either with the refunds part of the BK estate.

Baron95 said...

Dave said...
Much as how Eclipse likes to say that computers and jets are the same thing from a production standpoint, they aren't. There's a world of difference between a stationary PC and a high speed vehicle designed to travel miles high in the air.


And yet, the principal part of the EA500 that is not complete, critically uncompetitive and holding up sales is .... drum roll.... the freaking computers (a.k.a avionics).

It looks like they got the airframe right, but Foxtrot Uniformed the computers. Prety interesting given that the principals were from the Computer/SW industry, don't you think.

If I were doing a clean sheet plane project, I'd be spending 80% of my time making sure I had the best avionics/systems people around and 20% on the airframe.

From EA500 to A380 smalest and largest jet planes certified in the 21st. Both done in (or almost so) by alectrical/electronic/avionics issues on otherwise solid airframes.

Now look at the FARs and equivalent EASA certification regulations on part 23/25.

99.9999% of items related to the airframe, stability, construction, etc.

Are those regs obsolete or what?

Baron95 said...

Ziz said... Embraer is going to surprise people with how many Phenoms they make.

Yes. I agree. The only downer (for me not them) is that they have (at least for now) rulled out doing a SE/personal jet and/or SE/personal turborop. If they did that, they'd cut the oxigen out of Pilatus, TBM, CirrusJet, PiperJEt, etc instantly.

They just don't have enough engineering horsepower to handle anything more for the next 5 years.

They are going from ZERO Biz Jet a couple of years back to full line P100/300, Legacy, Lineage in 5 years. That is incredible.

Baron95 said...

CW said. ... it was Vern's persosality, and the resultant direction given that created the problem, moving targets, inadequate focus, and poor marching orders cannot be overcome by even good people.

I disagree CW. I have been in this position many times, and only once have I not been able to turn the ship in time, but only $15M was burned before whe stopped it from going any further. Real professionals have no problem telling the unpopular thruths and insisting on the right course of action against ANY CEO.

These guys probably got their "wet dream project" - build an avionics suite from scratch, they rob bought into the fantasy, they probably ignored their limitations, they probably didn't have have an achievable crawl, walk, run deliverable plan, etc...

I may be wrong on this one (too far removed), but for a blog comment, I feel confident is stating that these guys were a big part of the problem.

Avio was always a big bang thing - all or nothing with predictable results.

Baron95 said...

Shane and ATM - Can you please explain how you thin EAC came to own the 27 DJ planes? I don't think I understand the transaction.

Even with backstop guarantees, the bank is still out of money and needs to be paid, right? Or are you implying that the bank just acted as an administrator for Eclipse internal financing?

Please explain (I'm not disputing, just don't understand what you meant).

Thanks.

Baron95 said...

Dave said ... Yes, you are talking about BK, which DayJet is NOT in BK

Dave, I am sure this is not surprise for you, but the majority of companies that cease operations with outstanding debts never file for bankruptcy. They simply fade away. Creditors try for a while, then give up when they know the company has no assets.

It is very possible that DJ never files for BK. It is an expensive process. If they just want to die, they can sit and not do a thing. Even if creditors file law suits, they don't even need to respond.

Filing for BK is by no means a requirement for ceasing customer ops and ignoring creditors' demands. Since we have many international readers and non-finance folks, I think it is worth it to note the distinction.

julius said...

baron95,

gamblers only put more than 40% of their fortune in one type of share/cerificate...

If the CEO lost all of his fortune - he would be the best example (of an amateur) how not to invest money and what could be the result.
But, isn't that a platitude?

Why do you call these persons crazy "SOB" (perhaps ok for VR...)
some of them might be the stones you (and I) need to pass the waters...to get the right GA plane - not a FPJ!

You are right, without luck ... if you don't get the support by you family... it does not work.
But what is the difference between a pro and an amateur - go to the airport or golf and you will see it!

Julius

Baron95 said...

Julius said ... But what is the difference between a pro and an amateur - go to the airport or golf and you will see it!


You obviously did not see Tiger Woods playing when he was an amateur, have you? And you obviously didn't read about the horror stories of professional airline transport pilots trying to take-off on an airliner while drun and being arrested, right?

Just to illustrate a few.

Point being that some amateurs (Tyger, Gates) are just brilliant out of the bat in the first thing they tried. Some Pros have poor judgement and will be bad at what they do and they can "mask" it for a long time because they are "pros".

In the end, it is the man/woman that counts - not the label. It will always be this way. You can't train genius.

ColdWetMackarelofReality said...

Baron,

I too have been in this position, and I have been one of the good people. I have in fact been removed from programs for trying to do the right thing (yes, more than once).

There are limits to what people at the working level, working management, and management level can do in the face of executive incompetence.

If the design spec is never solid, if the partners are never solid, and if the executive is unwilling to accept the recommendations of his/her experts and is watching the development like a paranoiac hawk to ensure that they do what they were told then even good people can not have the impact they were actually hired to provide.

The company culture at Eclipse is now legendary in its' cult of personality aspect - and Vern is the center of that legend.

Dave said...

Dave said ... Yes, you are talking about BK, which DayJet is NOT in BK
Dave, I am sure this is not surprise for you, but the majority of companies that cease operations with outstanding debts never file for bankruptcy.


Baron right now you are frustrating me, though I don't think you are doing so intentionally. I said that in response to you bringing up customers of Pan Am and Eastern, which both filed for BK.

They simply fade away. Creditors try for a while, then give up when they know the company has no assets.

That is just it. Eclipse is delaying their creditors while burning the assets (which belong to the creditors) so that those who the money rightly belongs to wont have money to get back as the Eclipse execs will have spent it all on themselves.

Filing for BK is by no means a requirement for ceasing customer ops and ignoring creditors' demands

Baron I think you're missing what exactly DayJet is being criticized for. I'm criticizing Eclipse for [falsely] saying they can't give refunds when in fact they can but choose not to. I'm saying I would be more sympathetic if DayJet said they couldn't give refunds when they were in BK and the money from the unused customer tickets would be part of the BK estate where a judge would determine how the money was to be spent/returned/etc rather than DayJet delaying until there is no money for them to return.

x said...

Gainesville Airport Authority is reporting in its 9/25 meeting agenda that all Dayjet employees terminated except a few at Boca. It revises its dayjet hanger rent budget downward, leaves future 2009 eclipse rental (700K) unchanged.

Massive PDF source for the OCD only

julius said...

baron95.

"Some Pros have poor judgement and will be bad at what they do and they can "mask" it for a long time because they are "pros".

In the end, it is the man/woman that counts - not the label. It will always be this way. You can't train genius."

That's right!

But how often do we meet a "genius" - more often pros have the better judgement. An amateur may compensate a bit by his/her attitude... it's always also the person!

Julius

P. S.: How many airline pilots do not drink - how many GA pilots drink without being noticed by press/police?
I think, Tiger Woods is not the genius who can do without training, training ...(maybe he is the execption, but pros are generally training quite a lot).

airtaximan said...

Baron, a few opinions towards your questions... clearly not answers.

"Point being that some amateurs (Tyger, Gates) are just brilliant out of the bat in the first thing they tried."

Well, they were pros at something... eventhough not rank pros. Wll Gates began playing in the major leagues (IBM) early on, and took them... Woods, trained to within a inch of his life from birth... probably the best prepared amateur ever... and the best pro once HE decided to turn pro. Bad examples, but good enough point.

Regarding Dayjet repossession by EAC.

I read this somewwhere... and perhaps:
- EAC financed the planes for Dayjet? Not sure
- EAC provided equity for Dayjet and someone else provided the financing and when they missed a payment (sound familiar?) EAC took over?
- EAC provided a residual value guarantee, which came into effect when Dayjet missed a payment?
-or, EAC provide remarketing money, and thus the planes are in limbo, under EAC control, but owner by the finance co?

All possible, and very important in the fleet purchase scheme - it was pretty obviously more connected/incenstuous than we thought... I think?

Your thoughts are welcome - none of this is extraordinary in the ailine world BTW...

Baron95 said...

AT said ... Your thoughts are welcome - none of this is extraordinary in the ailine world BTW...

I know, but, it is usually very clear who owns a frame or engine at any given point in time in an airliner's life. And yes, occasionally Boeing and Airbus end up owning one.

But what you are taling about is ILFC leasing a plane they bought from Boieng to Delta and a year later when Delta misses a payment Boeing ends up owning it vs ILFC.

Shane seems to be making a straight assertion that EAC owns the 27 DayJet planes because they missed payments to a 3rd party bank. What kind of transaction is that? If Shane has the info on the ownership, he must also have info on the transaction structure. It sounds very odd to me, unless the bank was just being the admin for Eclipse provided finance.

Baron95 said...

Russia's aviation authority has suspended flights of Boeing 737s until their pilots receive additional training after a recent deadly crash.

Samoshin said the training is necessary to make sure all pilots properly read a key indicator showing the plane's attitude, the so-called attitude indicator or artificial horizon

So, apparently, some "Pros" need training on how to read an AI. WTF!!!!

TBMs_R_Us said...

Here's a new entrant in the SEJ category. Specs look good if one only needs four seats. It will be interesting to see if these guys get funded, given the disaster of EAC. Price at $2M makes sense to me for what the spec is. 2000 miles range for two people.

Stratos Aircraft VLPJ

Baron95 said...

TBM, I'm the last one to want to be discouraging, BUT, Stratos is a purely paper company at this time. CEO is anohter hi-tech/computer type, CTO is an ex lancair engineer.

Other than the web site and some CAD modeling, they have nothing.

I wish them well, but I don't recomend placing a deposit yet, though Ken may disagree.

400 KTS, FL410, 1,500nm 4pax NBAA range = CJ2+ territory today at $8M. Good luck getting there at $2M. Not impossible, But....

TBMs_R_Us said...

baron95,

I know, but it's fun to dream. Somebody said 8 or 9 out of 10 will fail, which suggests someone might succeed.

At least the deposits are going into escrow bearing interest....

airtaximan said...

CJ2+


err...

only 4 pax n ths one, right?

i couldn't help think about your exhuberant optimism, BAron... I thought these guys would be right up your alley!!!

airtaximan said...

"Shane seems to be making a straight assertion that EAC owns the 27 DayJet planes because they missed payments to a 3rd party bank. What kind of transaction is that?"

to be clear, if Shane said that, and he's right:

1- Dayjet planes equity was in fact provided by EAC... AMAZING!!! I could imagine a note from VR to DJ providing equity of $100M to purchase planes... this would be a big HOAX!!! but legal - then repos by RP when a payment was missed

2- EAC guaranteed some resid value, and when Dayjet couldn't re-market half their fleet as they were trying to do, EAC took ther planes and made good on the guarantee to the bank. THIS is common practice...

Especially considering the shennanigans regarding the grab back of the aftermarket - I think its B...

Baron95 said...

AT said ... I couldn't help think about your exhuberant optimism, BAron... I thought these guys would be right up your alley!!!

Ha, I don't even pay attention to aviation startups unless they FIRST show me the flying prototype. That is why I disagreeed so much with you guys on the value of the EA400.

So we have 3 flying very light personal jet prototypes - EA400, Cirrus Jet, D-Jet. Epic (though a bit bigger) getting close. And one has a web site up (BTW, not to be critical, but their web site has so many typos innacuracies and outright lies as to discourage me from even foloowing them).

They even repeated the fallacy that singles are safer than twins on an engine failure accident, obviously disregarding the fact that the huge majority of engine failures on twins do not lead to an accident and is not a reportable event except for jet powered planes.

Unfortunately, a poor first effort that lends little credibility. But I'd love to be proved wrong. Even if they got to FL250, 1000nm, 300KTS I'd call it a success, instead of saying "Failure, didn't meet original promisses".

Sad to say, but there is no realistic chance for these guys.

Baron95 said...

AT, where you are losing me is on the residual guarantee to the bank. If it was EAC financing, why does the bank have residuals? I'm lost and with out GPS - can you provide vectors?

Black Tulip said...

CWM,

I stand corrected.

eclipse_deep_throat said...

Jesus Christ... I can't believe what I've been reading. Like, blaming Dewey Colvin for all the problems of Avio. And then, yeah... it was DEWEY's fault for not marching into Vern's office and telling Truth to Power.

I mean, I knew Dewey. I didn't work with the guy on a daily basis... I started as your basic QA Inspector but I was working more on creating reports on Flight Test aircraft configurations. Then they needed my help doing configuration reports for the HALT lab, when I had the chance to work directly with Dewey and his team. Later when I was thrown into Calibration I had to cal his departments' tools and other assorted gizmos for the entire company. I just don't get it. They aren't "professionals" simply because they didn't tell Vern off?? Come on, this isn't high school.

Engineers are not generally the ones calling the shots at most technical / engineering companies. The guys with the money setting the goals -- even if, LOL...no, WHEN those guys happen to be assholes -- are the ones who have the only resonsibility here that matters. Even if the goal is totally unrealistic, do you think any engineer is going to tell Richard Branson he is full of shit with is Virgin Galatic SpaceShip One fantasy???

Guess we are all lucky that Christopher Columbus was able to get Queen Isabella of Spain to finance his absurd goal of finding a new path to the spice market. If Vern was successful we'd all be singing a different tune. If Branson is successful we'll all be talking about his "genius." Even the "PROFESSIONAL" NASA engineers couldn't get their pinhead managers to admit that safety was more important than the Challenger's schedule. Remember 1986???

So, yeah ...as professionals, we are supposed to push back at times. And I'm sure Dewey would have done that when appropriate. Otherwise, if you keep telling your boss only why X, Y, and Z won't work, you will wind up being the Fox Mulder of engineering, forgotten in the basement somewhere. Engineers try to find solutions to the impossible. And thank God they get up each morning and keep trying. Thank God they are able to find the modern day Queen Isabella's to finance their efforts so this process of continuous improvement can move forward.

I am a big believer in deflationary economics, so one day, someone WILL figure out how to make jet travel more affordable for the masses. It will take engineers, bean counters, and visionary leaders to set the course. We can't start disrespecting the people who create the technology because it isn't perfect with Version 1.0. Specifically with transportation, we are SO lucky to live in this time with Chevy Volts, Honda Civic hybrids, and Toyota Prius' all gaining mainstream appeal. I will also admit to being an incredibly impatient person most of the time. Why can't I get 24th century Star Trek medical technology NOW so my sinus surgeon can get me to breathe better??? Why can't I get Warp drive now damnit??! This is truly silly to think that all of this stuff will work perfectly and that we can get what we want all the time. Like someone else said but I'm tweaking here to make a point: Vern had an idea, he tried it out, it didn't work. Next.

I'm sure Chris Columbus would have been much happier traveling from point A to point B in an EA500 instead of the Nina, Pinta, and Santa Maria. Perhaps the next GA start-up will have a better leader to direct the engineers. The industry as a whole will learn from this experience and all the players will improve.

Ok, I'm done venting....

E.D.T.

airtaximan said...

EDT,

I really like you

airtaximan said...

baron,
here's my spot - maybe yours is better...Advise...


The bank finances - base in a resid vlaue GUARANTEED by EAC.

So the bank shows up and says: "Dayjet... we're repos your planes - EAC is responsbile for the white tails, and is defacto paying the bane sales price - guarantee.

The bank can always jst say OK... pay me X and you can have POS.

End of discussion

jet_fumes said...

Eclipse_deep_throat you should be venting more. Fabulous post.

PawnShop said...

An Ohio-based air-taxi startup is having trouble getting things going. Besides the inevitable money issue, they're having trouble getting FPJs:

Since Brechter left, two major issues have hampered Waypoint's funding efforts, Humphries said.

There was an executive shake-up at the money-losing manufacturer of the Eclipse, one of the jets that is expected to be a core aircraft for Waypoint. Production was halted for a short time, causing some to worry about availability of planes and parts. Shortly afterward, it was announced that the Federal Aviation Administration was conducting a 30-day review of its approval of the Eclipse.

Then, DayJet, a high-profile Florida air-taxi operation, ceased operations at the end of last week, causing some to question the air-taxi model.


Others blame DayJet for their own demise:

Peter Leiman, managing director of London-based air taxi Blink, attributed DayJet's demise largely to overspending and overreaching.

"DayJet spent $30 million on an IT system to optimize utilization and answer all the questions, before they even knew what all the questions were. They were planning for having 300 planes before they learned to manage nine or 10 or 11," Leiman said.


( Sounds like a call to the 505 might give 'em a line on a couple dozen low-mileage, late-model, previously-owned FPJs - if they're really interested... )

Would you like the undercoating?
DI

PawnShop said...

From the utterly & completely off-topic department...

As Hurricane Ike hit the Texas coast, the Chicago area experienced absurd amounts of rainfall ( 8 inches in 7 hours! ). Over at JetWhine, one of Robert Mark's readers sent in some photos from ORD during the soaker:

Surf's up!

Would you like a dry change of clothes?
DI

TBMs_R_Us said...

Interesting accident data from AOPA re: single engine turboprops US and Canada fleets through 2007.

Accidents due to power loss / mechanical failure (fleet size in parens):

Caravan: 11 (910)
TBM: 0 (281)
Pilatus: 3 (570)
Meridian: 1 (258)

Fatal accidents due to power loss: 0

I don't know the numbers for the MU-2, but it's not zero. Maybe in theory two engines are better than one, but history has yet to follow theory, at least with respect to turboprops.

GettingReady2FileSuit said...

Attention all current and future suckers!!! Give us another $40,000 and increase your money down the drain. EAC will be bankrupt 3 days after your check clears!!!!

Hello Bagholder,

I want to provide an overview of the modifications and service capability we discussed during the customer call on September 19.

We continue to work diligently on the modification plan as we balance our current resources. As you know, we have been working on contracting with third party providers in order to add capacity to the modification schedule. We are in the final stages of signing contracts with the following three modification centers:
1. Epps Aviation in Atlanta;
2. North American Jet in Chicago; and
3. Harbour Air in Vancouver, Canada.
We expect to finalize the service contracts this week that will allow FIKI modifications to begin on October 20.

Eclipse will pay for the FIKI modifications, as we have communicated previously. In order to have the FIKI modifications performed, an aircraft must already be in the NG and ETT configurations. The FIKI modification is expected to take approximately two to three weeks to complete due to a requirement of the supplier modifying the Center Switch Panel (CSP) to accommodate the extra ice protection switch. The FIKI modification does NOT require the 1.5 mod.

The following Table attempts to simplify the choices:
1. Serial 1-38 – requires a) ETT; b) Avio NG; c) Avio NG 1.5; d) FIKI
2. Serial 39 - 104, 113 – 115, 120, 123 – 124 – requires a) Avio NG; b) Avio NG 1.5; c) FIKI
3. Serial 105 – 112, 116 – 119, 121 – 122, 125 – 265 – requires a) Avio NG 1.5; b) FIKI [may have FIKI without 1.5]
Customer call – Friday September 19, 2008
We announced a new plan of execution for customers who would like to combine the FIKI and Avio NG 1.5 modifications. Based on numerous requests from customers offering to pay for 1.5 mods to expedite installation, we are offering a program whereby a customer may pre-order and pay Eclipse Aviation for the NG 1.5 hardware during a window in early October. This is required because of the lead time to receive the NG 1.5 hardware and subsequent scheduling. The combined modifications will begin in January 2009 or sooner, if possible. For planning purposes, we expect the Avio NG 1.5 hardware will cost customers approximately $40,000 which will have to be paid for at the time you place the order. We still plan to pay for the Avio NG 1.5 mod and will have a detailed communication regarding the combined modification program, parts ordering process and reimbursement plan to all customers next week.

In another announcement during the call, we have taken all the feedback from our customers and we presented a new approach to scheduling the aircraft into the three 3rd party providers. Contrary to previous scheduling plans that required customers to call the service centers directly, Eclipse will now process all scheduling of modifications through the third parties. We will take into account whether the customer would like FIKI only or to place an order for the Avio NG upgrade. For this reason, no scheduling will be done until the 1.5 hardware ordering window in early October is complete. We envision that we will be calling you shortly after October 13th to begin scheduling aircraft into the service centers on the 20th. We believe this will ensure a smooth scheduling process and equitable allocation of modification timing.

Customers with pre NG and ETT modifications will be notified of their modification plan as soon as our financing is received, technicians are hired and trained, and a flow of parts are available. We anticipate the process of hiring and training will begin in late November with four mod lines to perform these modifications beginning in early 2009, again dependent on lead times for parts and technicians. We are estimating that it will take approximately four weeks to complete the NG and ETT modifications once the mod lines are fully staffed.

I would also like to announce an effort we are working to correct the transponder and uncommanded radio/altitude change fix for Avio NG aircraft. This software change for Avio NG equipped aircraft, referred to as Avio NG 1.3, will be available shortly after the certification of Avio NG 1.5. Additional information will be communicated as this upgrade becomes available.

We continue to make progress in our operational excellence strategy and continue to focus the organization on improving our effectiveness and efficiencies. If you have any questions regarding this or any other subjects, please contact our Customer Care team at 1-877-350-0538 or 505-724-1200. Please keep in mind that they will not be taking calls to schedule aircraft in to service centers and will not accept calls for payment of NG mods until the early October window.

Warmest regards,

Mike McConnell
President and General Manager Customer Division
Eclipse Aviation

Beedriver said...

The day jet deal sounds like the standard deal we used to do in my manufacturing equipment company.

The manufacturer of the machine sells the machine to the customer. Instead of paying for the machine by borrowing the money or by paying cash he decides to work with a leasing company.

The customer finds a leasing company to lease him the machine.

Now the leasing company is nervous about how he will get paid if the customer does not pay.
to take care of this risk, the manufacturer of the machine signs a deal with the leasing company that they will buy the machine back if the leasing company does not get all its money. this is a way for the leasing company to be protected and usually the manufacturer of the machine also is in the best position to dispose of the used machine that is repossed. This is also good for the manufacturer because they get all their money as soon as the machine is delivered and accepted.

Typically this allows for a minimum down payment and sometimes no down payment or no payments for 6 months allowing the machine to be productive before you need to start paying for it.

many times the deal between the leasing company and the manufacturer may have time limits such as a buy back guarantee of 80% for the first year, 60% if repossessed during the second year and so on.

Thus if Dayjet defaulted on their lease, Eclipse then would own the airplanes after paying the leasing company the balance. the result is that it is really a debt of the manufacturer but it does not show up on the books.

This is a standard arrangement in the capital equipment world
I hope that helps explain it.

Baron95 said...

EDT said ... We can't start disrespecting the people who create the technology because it isn't perfect with Version 1.0.

10 YEARS - Hundreds of Millions Spent on Avio - Full Cheerleading from CEO. Output: Incomplete crap. You can try to excuse the project leaders from responsibiity, but it is not possible. What is their excuse for the altitude transponder codes changing by themselves in their SW? What is their excuse for not being able to integrate the output of ANY GPS receiver into their SW? What? There isn't one. It is pure and utter incompetence. (At least from where I sit, which is very far removed from the situation)

The airframe is basically OK. Production got up to 6/week. Financing was plentiful. Sales were lined up. They recovered form the engine switch. The single item that will sink Eclipse is the avionics development failure. The leaders of the Avio project CANNOT escape responsibility.

Baron95 said...

1. Serial 1-38 – requires a) ETT; b) Avio NG; c) Avio NG 1.5; d) FIKI
2. Serial 39 - 104, 113 – 115, 120, 123 – 124 – requires a) Avio NG; b) Avio NG 1.5; c) FIKI
3. Serial 105 – 112, 116 – 119, 121 – 122, 125 – 265 – requires a) Avio NG 1.5; b) FIKI [may have FIKI without 1.5]

Flightcenter/Shane - can we put this on a spreadsheet and link to the main page. This is a full summary of the state of the Eclipse fleet. Combined with the man-hours and HW costs provided, we can calculate fairly precisely Eclipse's liability to update the fleet.

As for the rest of the Eclipse comuniqué (thanks for posting, get ready to sue), it was business as usual. Have you noticed that Eclipse never says that anything is ready. It is always: it will be ready in January pending this and that. This one is particularly so. We are getting ready to sign contracts, to then get ready to start hiring/training, to then get ready to take deposits on a window, to then get ready to announce a plan to schedule, to then get ready to order the HW, to then get ready to schedule, and then we will get ready to tell you when you can schedule your mod, and then...

My God - "Have you no shame?"

Baron95 said...

Beedriver said... This is a standard arrangement in the capital equipment world
I hope that helps explain it.


Thanks Beedriver. I am familiar with that arrangement. But typically, in that arrangement, the leasing company is the owner (holds title) to the equipment. So the leasing company holds the planes (assets) and simply has a buy back guarantee from Eclipse.

So Eclipse still needs to make good on their promise and come up with the cash to buy back the planes.

Shane was saying that EACs owns the planes automatically. I don't know how that can be. Unless Eclipse put the money out to make the loans in the first place.

So, I still don't get the arrangement.

ColdWetMackarelofReality said...

BT, are you speaking about being corrected about Matt Brown?

I am sure you may have found him impressive - especially if it was in a sales/presentation environment, as a UND grad and former freight dog (IIRC) he has a good story.

My exposure was not very impressive or flattering for him but I honestly may have seen him at inopportune times.

The other gentlemen mentioned were top-notch in my opinion and as is unfortunately the case every now and then, they were apparently hamstrung by bad management.

easybakeplane said...

Several good posts over the last few days on the EDT topic.

Baron, I know you think most of us don't know what we're talking about when some of us try to warn others about some of the 'dangerous' things to watch out for in the aviation business, but if you wouldn't mind taking a big pay cut you could come work for some of these OEM companies and experience these types of managerial brillance on a daily basis:

" We'll manage the risk"
- referring to a design being uncertifible
" There is no change to the schedule until it changes"
-referring to the impact of a large design change
" Stop throwing hand grenades"
-referring to an Engineer doing their job (finding problems with a idea in an IPDT environment)

and of course my favorite (that I have quoted before)

"Maybe it would be cheaper to pay the litigation costs than to redesign the system"
- Engineering Director referring to a proposed Design change of a serious issue


--------------
On the test rig issue, why do think Toyota has been known to test all kinds of different parts to failure on their designs?

As an aircraft company, if you can't:

- predict where it will break
- predict what it will cost
- predict what it will weigh

... do don't know jack!

I guess EAC is 0 for 3 !

Baron95 said...

easybae plane, I don't think that at all - I have the utmost respect for people trying to do their jobs under adverse circumstances.

If everything were easy, we would not need to work hard to overcome problems.

But my understanding is that the guys mentioned were the guys making the decisions, calling the shots, establishing the architecture, etc of Avio.

As far as comparing the EA500 to cars, it is a big stretch, but maybe the 2001 7-Series comes to mind. Nice vehicle dynamics but the iDrive SW, like Avio almost did it in. It really never recovered its footing vs the S-series after that and it is currently outsold more than 2 to 1 IIRC.

PawnShop said...

Shane was saying that EACs owns the planes automatically. I don't know how that can be. Unless Eclipse put the money out to make the loans in the first place.

So, I still don't get the arrangement.


Three words for ya, baron:

"DAYJET LEASING LLC"

Dayjet Services defaults on Dayjet Leasing. Dayjet Leasing invokes buyback on EAC. Ed, a "close personal friend" of Vern's, chokes off operating capital from Roel, who fired Vern ( who should have been gone 3 years ago ); floods secondary market with early S/N FPJs ( which will require additional capital-intensive upgrades to be resellable ).

Would you like the double-cross?
DI

Baron95 said...

DI, sounds cool. But can you tell me who do you think holds title to the 27 planes?

How did Shane come to the affirmation that it is EAC?

fred said...

baron :

as usual you took what was said out of context (if i expressed myself in a non-understandable manner = sorry!)

i personally know one of the guy who was with gates at beginning ...
may be it is out of jealousy ; may be it is out of pride , but the guy told me that Bill is not very bright in term of cleverness but very good in knowing how to be surrounded by quality peoples ...
(it works so well that it had to have at least one exception :Vern!)

as a matter of fact , not a single prediction about computer world he made , has been true to date ...

i think he had "luck factor" , which is important ... not to the point of saving a bad concept , but that could make the difference between two project equally just ok or mediocre ...!

as well as B.G. had a VERY VERY IMPORTANT feature = knowing how to listen to peoples around... ! which is very probably what was the most missing part of Vern's culture !

what i wrote about amateur VS pros is to be taken this way :

i have seen and followed thousands of projects ...

out of it , i would venture i met 4 types of IN CHARGE or CONCEPT Peoples :

the one who are Bright , Clear , Well organized , Charismatic , Listening to who they choose carefully to be with , understanding EACH aspect of business or willing to accept some other to tell them "i think here , it should be that way ..." and at the same time focused enough not to loose themselves into anything stealing their focus ...

up to now , someone with such qualities , i have met only 2 , they are both F***g successful , i had no doubt about because they are both the type of persons you put in a room with 50 others , anyone from outer world can say
"wow , this guy is different" even if they don't exactly why and/or the said guy didn't open his mouth ...

2° the ones who are clever enough to know about their own lacks of tech. know-how , finances mastering , etc ...

but know how to have some around ...
already a more common type , but still quite few ones in the mass of "would be "...

3° the ones who understand that something is missing , but have no real idea of what ...
nonetheless they managed to have a project or concept that can more or less keep tracks ...
this is where the "luck factor" work the best
(they are the most of the one with some success ...)

4° the ones who are always talking about how interesting , sure and easy is going to be for them , because it is them ...

they usually don't have a clue of who they need around , but grade quality of peoples by the nice things they say toward them ...

they usually have no clue as well about what they undertake ...

the typical kind of thinking is such :
"i know how to pet a cat ! cat are cousin of tiger ! so i can pet a tiger w/o problems ..."

so if you understand more or less what i wrote , for you it shouldn't be difficult to work-out why i said about "Pros VS Amateur"

some amateur can be in the first class , but usually they don't remain amateur very long ...

the fourth class will never get over the amateur level status , even if they are "supposed" to be pros !

vern was definitely in the last class , roel quite probably ... this is where PURE LUCK has such an effect that i can say :
"failures always teach more than success !" did they get the lesson ??? nothing is less sure !!!

fred said...

the 27 DayJet planes are still owned by EAC ???

that would be no surprise to me ...
here how i think it could have happened :

Roel,Ed and Vern are buddies for a long time ...

Vern decide to build planes (why not..)
but he has to organize a way that will attract investors and customers like bees on honey ...
so , together , they define a way :
one is "making" planes ...
one is buying them ...
one is financing the expansion worldwide ...

in order to do so , they need something flashy which can confirm the validity of the concept ...

what is best ? = an Jet-Air-Taxi venture that would enable "important ones" to fly cheaper on their journey to make MORE money ...

the trap is set , most see the TIME and Money they would save while making even MORE money ...

few see the discrepancy here = if you are an "Important one" you have already enough to afford better , faster , more reliable or you just don't NEED to rush to make MONEY ... (funnily enough peoples with real money are usually quite cautious ... how many unsuspected "Rich" being quite careful in what they do with money VS stupid brainless piece of shit like Paris Hilton spending like mad because it is much easier to remember a pin code or sign a CC slip than to think ???)

but Ed is probably the sharper of the three , so he doesn't want to put his own cash into venture ...

so the two others propose such :
"we GIVE you ownership of a few planes at the CONDITION we can proclaim that you ordered that many THOUSANDS planes ..."

very easy to have ownership given away while the planes are "Pledged" (term in french is : Nantissement or "i give you official ownership but value remain mine !) to EAC ...

Ed goes to see banks , saying i want a loan giving as guarantee the planes he is supposed to have paid ! the bank say YES , because they see official ownership transfered to DJ ...

like that DayJet can launch , they just need enough cash to remain open until IPO , then they will have enough cash to reach a "critical mass "

When reaching this "critical mass" they will buy Jet to saturate the market (what B.G. did with his OS)

off-course , they will buy EA500 !

result : without risking more than a few kopecks , they gain the jackpot ...
like a good old dot.com !

that explain as well very well the "Rocket scientists" (need to blur the almost believers and to inflate artificially the value of concept = more money from the bank and less question about Bizz-plan = if a banker would have asked , they would have answer "do you understand triple square root of the integral exponential value of N² ?" banker not willing to be taken for stupid who have say "yes , your concept IS valid !" in fear of loosing a potential earner [which is EXACTLY what did happen to Lehmann , Bears , northern , Fannie , freddie , etc = fooled by their own trap of foolishness !]economy is so fun , sometimes ;-)) )

AND this explain quite well the CC No-Refund ...

they cannot or do not want to pay back , but they need time ... time that BK won't allow ... so they delay ...
if the Credit Card system put its nose into it following a BK , the whole thing fall apart , plot is unveiled and it is DEFINITELY finish for Etirc/Eac ...!

this is something THEY (all three) cannot afford until Russia plot is launched (Russia plot = take out all or most assets out ...)

things works as planned but EAC fail to deliver a "GOOD ENOUGH" plane so the relation become "Officially" sour ...

this is where Ed decide he has been playing enough , and tries to unplug ...

fred said...

#This software change for Avio NG equipped aircraft, referred to as Avio NG 1.3, will be available shortly after the certification of Avio NG 1.5 #


i read that as :

"get lost ! we will NEVER retrofit !"

if not , why do they plan to fix a failure of a previous version AFTER releasing the newer version ...

it is software = why not jump straight to newer for all ...!!

fred said...

joe :

#"It is better to have 3 people who KNOW WHAT THEY ARE DOING work a given project, than 10 people who don't"

I suspect some Harvard MBA math of this type may have gone on at Eclipse:#

don't worry it happens everywhere on earth ...

the best example i know : in France , we have a special school for Civil servant of high profile ... it is called E.N.A ! probably one of the most difficult to get into , worldwide , M.I.T, Harvard or Yale are jokes compared to it ...
is it because you have to be a Genius ? NO ! it is only based on "How much you can learn !" no need to understand what you learn , as long as you know it ...!

so we have lots peoples going out of this with an instruction extremely wide are they clever ? for most not more than average ... but the process of putting so much into their head provoke a curious disease : they cannot think of anything which is not in the book !!

sometime i work with such , i usually play with them (it's so funny) giving them problems without any solution ...

where anybody would give-up as soon as understood ...

they keep on trying and trying and trying ...

so much (vicious) fun ! ;-))

fred said...

# The boys running Lehman were the ultimate pros - The CEO just saw 99.5% of his personal fortune of $775M evaporate. #

Pure B.S.

the ones running Lehman were there because they were saying exactly what the board and customers were looking to hear :
"We are great ! we are the best ! F*** the chineses ,F*** the russians , F*** the arabs ! they sweat , we consume ! "

where they should have said "wow , slow down a bit ... when one is living in a house which has a value of 1.000$ and is happy in it , if the price raise to 1M$ , is he going to be happier ? can he extract any value out ? no ! as soon as he will want to sell the house , the market will collapse !"

but that was too tempting for those crook to have owners borrowing on a value that didn't exist (in real term)in the first place ...


the CEO lost 99.5% of his fortune ?
wake -up a bit ...

why was he CEO ? because he was undertaking the loan-scam or because he may be a bit more clever that all the ones who thought of themselves as "rich and clever" all those being a perfect illusion ...?

more likely to be the second , no ?

so i would say : "he has lost 99.5% of his fortune REMAINING in USA !"

come to Swiss or Luxembourg , you would be amazed by the crowds of Americans there , but those are the ones with REAL money ...

fred said...

joe :

i am going to digress a bit concerning your daughters ...

tell them you are in contact with someone who have been (some times ago) in Afghanistan ...

where i have personally seen locals kids going completely crazy about me giving them chewing-gum ...

one translator told me that a kid said that he thought he would die before knowing this taste ...

while WE are spending Billions in waste and complaining about terrorism ...

but no one to say " you don't want terrorists = give them no reason to become one !" (limit their poverty !)

then explain them what is "spoiled kids " !!

i know it is tough , but i can tell you that this is the fruit of an education where , when i asked my father for fancy anything , the answer was always :

"i give you all necessary for free , anything superfluous is your problem !"

i am extremely far from being perfect , but now i understand what he was meaning , even if i don't have any kids ...!

fred said...
This comment has been removed by the author.
fred said...

e.d.t.

#I am a big believer in deflationary economics, so one day, someone WILL figure out how to make jet travel more affordable for the masses #

on some aspect , you're right ...

BUT

deflation (like inflation) has weird effect ... no one knows where the GOOD sides will impact and where the BAD sides will land as well ...

may be one day , jet travel will be affordable for all ... but i doubt it !

if it is following some gain in productivity (sorry the US one is quite low compared to some foreigners ) efficiency , fuel consuming ...
YES , it may happen !

if it is a pure effect of deflation ...
NO , it won't !

you see one of the funny aspect of REAL value VS ESTIMATED market price is such that a nice suit bought in 1900 was costing about an ounce of gold ...
now a nice suit is being bought with a ounce of gold ...

different prices but value remain the same !

Black Tulip said...

CWM,

Yes, I only saw the veneer not the underlying substrate.

airtaximan said...
This comment has been removed by the author.
airtaximan said...

A BIT OF ADVICE:

"For planning purposes, we expect the Avio NG 1.5 hardware will cost customers approximately $40,000 which will have to be paid for at the time you place the order."

- IF YOU ARE CRAZY ENOUGH TO WANT TO DO THIS - PAY IT TO THE HARDWARE SUPPLIER DIRECTLY -

fred said...

yes , airtaxi ...

or to Clark Loop with :

a good rope
a bag of feathers
a canister of tear

you may be cutting a good deal !

airtaximan said...

Oh my:

"we still plan to pay for..."

-and-

"details of the reimbursement plan next week..."

sounds fishy

airtaximan said...

"....Please keep in mind that they will not be taking calls to schedule aircraft in to service centers and will not accept calls for payment of NG mods until the early October window...."

that's when they begin accepting credit cards...

OK, bad joke

Turboprop_pilot said...

Regarding the $40,000 for the Avio upgrade:

Since Eclipse is on COD with all (most?) vendors and they are pretty sure there will never be financing, they have no choice except to beg the faithful for the cash to upgrade. If they have any success, then expect to have them request cash up front for more and more upgrades.

The fat lady is finished warming up...

Turboprop_pilot

Turboprop_pilot said...

Fred:

Your post starting:

"the 27 DayJet planes are still owned by EAC ???"

is your best post so far. You describe a massive fraud for Eclipse' earliest days that should send Vern, Ed and Roel to jail. Thanks

Turboprop_pilot

fred said...

turbo :

thanks but

#a massive fraud for Eclipse' earliest days that should send Vern, Ed and Roel to jail #

this is where it starts to be beautifully planned ...

Vern has got "Quitus" = no jail !

Ed is going to play the "I've lost so much into this scam , i f would be an accomplice , i would have made money ...."

Roel is not US citizen , so he doesn't have to care too much ...

EAC with the plant in Russia become a king of unwanted state property (the bank and the Ulyanovsk province are supposed to become main shareholders of plant )

who would be mad enough to try to sue the Russian Govt ?

you see , sometimes, economy is real fun ... (unless you are caught in it , off-course !)

fred said...

i forgot :

if things get a bit hot for Ed :

he will claim = 27 items on an order of 1400 is almost nothing !

Boeing and Airbus are doing the same in most of their sale contracts , it's called "rebate on volume" ...

i just got the free ones before getting the paying ones ...

nothing illegal !

as for Roel : how a guy which has known mostly failures in his professional life can achieve to make a fortune ?

when a cat is dead since a while = it stinks , even if you loved it !!! ;-)))

Dave said...

"For planning purposes, we expect the Avio NG 1.5 hardware will cost customers approximately $40,000 which will have to be paid for at the time you place the order."
- IF YOU ARE CRAZY ENOUGH TO WANT TO DO THIS - PAY IT TO THE HARDWARE SUPPLIER DIRECTLY -


Eclipse has shown that unless you do business with them COD, they'll find ways to abuse you. Either Eclipse will take the $10 million and not give anything in return or they'll sucker people in by having $40K just be the first intallment out of much more. I believe Vern had said previously that upgrade would cost Eclipse around $30-$40 million, which would put the real costs at around $150K per unit if Vern's estimate wasn't itself a low-ball estimate.

Also here's some new articles:
New Mexico Business Weekly on FAA Hearings
New Mexico Business Weekly on Roel Interview (Subscription Required)

Dave said...

A point of clarification. It was Avio 1.6 that Vern said it would cost $35-$40 million:
Other additions include a flight director and more capable autopilot. The autopilot can be coupled for ILS/localizer, GPS, and VOR approaches. It will fly the ILS glideslope. The next upgrade, Avio 1.6-due out late this year or in early 2009-will allow it to also fly the vertical element of a WAAS approach; in 1.5 the pilot has to manage the descent, although it can be done with the autopilot engaged. In addition, the autopilot can be engaged to fly a climb or descent profile using airspeed or rate. Eclipse hopes to certify a go-around feature that allows the autopilot to remain engaged during a missed approach.

During preflight, the 1.5 system provides a graphical weight-and-balance screen. The pilot enters passenger and baggage weights and the system shows him where he is in the CG envelope. The owner can pick up to 10 cabin configuration profiles to be stored in the airplane...

The panel upgrade eliminates the two keyboards, which are not compatible with the Garmins. Most customers moving up to the Eclipse have accepted the change with minimal complaints, according to Eclipse. Pilots moving down from larger aircraft that typically have keyboards are the ones who miss them the most.

Avio 1.6 will include access to datalink weather; activation of the autothrottle system; a radar altimeter; ability to access a "progress" page that shows expanded flight plan information; greater integration of systems through the MFD, such as interactive takeoff and landing information that will calculate runway requirements; vertical navigation planning; and Jeppesen charts on the MFD.

FMS-like features missing for the foreseeable future include airway-to-airway flight planning and en route coupled vertical navigation. Flight into known icing certification was received in June...

Owners we have spoken to generally enjoy their airplanes. They acknowledge the 500's current panel weaknesses and are anxious for their upgrades. Eclipse has committed to upgrading the entire fleet to the Avio 1.6 level at no charge to the owners. Eclipse CEO Vern Raburn estimates this will cost $35 million to $40 million, money he has set aside for that purpose. He estimates the upgrades will be completed by the end of the first quarter of 2009.

Eclipse On Avio Upgrade
That then raises the questions as to why Avio 1.5 instead of 1.6 is being offered and why the price difference? Does it really add around $100K to go from 1.5 to 1.6?

airtaximan said...

"...this will cost $35 million to $40 million, money he has set aside for that purpose"

any bets on this?

Dave said...

any bets on this?

It is bad either way. If Eclipse already had set aside the $40 million and needed to hit their customers up for $10 million more, that would mean upgrades are very expensive. If on the other hand Eclipse knows that they are low-balling their customers and have raided the piggybank, that is just as bad.

Dave said...

Eclipse is being sued by yet another depositor...

Dave said...

Roel plans on using Russian money to bail out ABQ!:
The Ulyanovsk plant will have the capacity to build up to 800 Eclipse 500 aircraft per year, as well as provide customer support services, according to Eclipse. But ETIRC isn't obligated to invest all of the $205-million in the Russian facility. An undisclosed portion of VEB's will be paid directly to ETIRC essentially as a production rights fee, potentially providing a much needed cash infusion to the struggling Albuquerque firm, in which it hold a sizable interest. ETIRC will use another part of the funding to build the physical facility at Ulyanovsk. ETIRC will pay the remainder of the money to Eclipse to provide tooling, engineering services, training and quality assurance.
Aviation Week:Russian Bank Okays $205 Million for Eclipse

Orville said...

From the Aviation Week article:
"When it comes in, our priorities will be to settle our relationships with our suppliers, take care of our customers and resume normal operations in 2009."
Note the order or 'priority' - suppliers, then customers. And the words 'take care of our customers'.
Is a customer that requested a refund still a customer? Probably not.

fred said...
This comment has been removed by the author.
fred said...
This comment has been removed by the author.
fred said...

dave :

#Roel plans on using Russian money to bail out ABQ!#

how to say ? is he mad ? is he dreaming ?

does he really believe nobody from
FAPSI + Федеральная служба безопасности Российской Федерации
can read english , dutch and is not reading the blog ???
(Priviet , drouk ! ;-) )

more and more , i smell that everything was planed from day one !

sound so nicely happening in a timely manner ...!

Baron95 said...

fred said...
Avio NG 1.3, will be available shortly after the certification of Avio NG 1.5 #

why do they plan to fix a failure of a previous version AFTER releasing the newer version ...

it is software = why not jump straight to newer for all ...!!


Fred - AGAIN, no need to find fault with EVERYTHING Eclise says/does.

In this case you are wrong (surprise!!!).

Avio NG 1.5 REQUIRES A BIG HW CHANGE - they need to install a switch, remove the keyboards, install the G400Ws, etc, etc, and then do a SW load.

Avio NG 1.3 is a maintenance (i.e. bug fix) release, that will fix the problem of transponders and altitude changing on their own.

Now, why this does not require an AD is beyond me.

Eclipse 4-Tango-Uniform cleared to FL350 squawk 1234. Pilots sets the altitude bug and code, starts the climb. Avio then decides to change the bug to FL360 and the squawk code to 4321.

All of a sudden, controller has an unidentified target (unknown xponder code) flying in the wrong direction in the jet route potentially headed to another RSVM aircraft.

And that is safe, how?

Orville said...

Baron - nice choice of N-number. :)

Dave said...

So what happens if Eclipse/ETIRC using Russian money for ABQ, but receive no more funding and so can't build in Russia or ABQ? If Roel takes money from Russia, spends it and then doesn't produce Russian jets, it would seem that he'd be rather trapped in not having any safe harbors to flee to.

flightguy said...

Etrick has its money. It is not Eclipse money. Roel can watch the ABQ collapse and call it a day after delivery the rights to Russia to start their own prodcuction licensed from him (Etrick). Anyone want to bet that he comes out ahead from the original investment in Eclipse?

Dave said...

Etrick has its money. It is not Eclipse money. Roel can watch the ABQ collapse and call it a day after delivery the rights to Russia to start their own prodcuction licensed from him (Etrick). Anyone want to bet that he comes out ahead from the original investment in Eclipse?

Regardless of what Roel does, I don't think he will. I don't see Roel profiting by having ABQ shut down and producing all FPJs in Russia.

fred said...

baron :

i explained WHY i think all was planned from day 1 ...

they don't do everything wrong , in fact : it is quite hard to keep on screwing customers with such consistence ... ! ;-))

so Fpj was only a way to dry-out some dreamers from their cash ...

Dave :

if Roel is doing what you wrote , Safe harbor WONT exist , anywhere ...
i have already seen how they deal ( No , the guy in London WAS not a Russian deed ) you just vanish = end of story ...!

flightguy said...

It's not a matter if anyone actually produces a plane ever. It's a matter of profit and ROI.

Fred is correct they have been planning a long time. My suspicions were raised years ago from relationships and press relaeses. The russians are just a means to an end.

Dave said...

It's not a matter if anyone actually produces a plane ever. It's a matter of profit and ROI.
Fred is correct they have been planning a long time. My suspicions were raised years ago from relationships and press relaeses. The russians are just a means to an end.


Mine too, but just because you concoct a scheme, it doesn't mean it will work. I don't see Roel doing well on this, but I do think he's got a scheme going on.

Baron95 said...

Orville said...
Baron - nice choice of N-number. :)


Thought you guys would enjoy that tough ;)

Did I tell you guys that I managed to get license plates "55 SUX". It lasted almost 1 year, then DVM sent me a letter saying those were issued in error and I had to chose another vanity plate within 30 days AND I'd have to pay for the new ones. After back and forth communications, I just took a plain plane free of charge. Oh, well, it was fun while it lasted ;)

airtaximan said...

Guys, I think I figured out why Pieper keeps saying the Russian factory will produce 800 units a year...

He's trying to get them to pay his per unit royalty up front!!!

Man, this is truly one amazing story.

Imagine licensing a product that costs $1M more to make than you can sell it for?

Imagine licensing it just after imagine its best market/customer proves you don't need many if any, and cancels its order and goes out of business?

Imagine after 12 years, you sell a to a few hundred individuals clients (some buy 2, some buy 7) after spending millions worldwide, and you still claim you need to build 800 a year under license in Russia, plus ABQ?

Man, these clowns are really good at this!

** Roel is smart enough to know he has to make money going in, becasue there's no money to be made from product coming out.... THATS for darn sure

Deep Blue said...

Whatever monies Etirc gets its hands on, you can be sure that Etirc gets taken care of first (its likely loan to EAC). After that, they're out, or at least indifferent as to what happens in ABQ or Russia.

This is a classic exit strategy for a bridge financier that Etirc/RP probably is.

They are not industry investors.

At any rate, US$200MM would evaporate into liabilities in ABQ; even if it could be rationed as ABQ working capital, what meaningful amount could support a tangible expansion?

You're seeing the results of the deep conflict of interest between EAC and Etirc.

I'm a bit surprised the "Russians" (whoever they are) could be this naive.

Dave said...

You're seeing the results of the deep conflict of interest between EAC and Etirc.

Roel has used his own 180 unit order to talk up the Russian project as there being proof of demand. There's conflicts all over the place.

flightguy said...

Etrick can create whatever order backlog number that Eclipse wants or investors desire.

airtaximan said...

Roel buys Dayjet for $1... order is saved!

Can also charge a per-seat segment fee for using Dayjet's computer system...

Imagine the projection:
- 1430 planes, flying 2 passengers 3 trips per day... that's $24,000 per day in income for Dayjet... based on a $5 fee. They could probably handle this with 10 employees - total.

...gotta love it, BEGIN the projection with 1430...

Orville said...

IF an order like that - or for any substantial quantity - suddenly, magically appeared - do you think there's anyone left that could turn out a conforming, quality aircraft?

flightguy said...

Has there ever been?

Orville said...

Flightguy,

Good point.

Orv

fred said...

deep-blue :

don't worry the russky are NOT this naive or stupid ...

i am sorry i cannot leave out too many details of the loan , but i can assure you of one thing :

Roel,Etirc or EAC , none of them are going to control the sum at ANY point !

in fact , it's a dead-end for the scheme they 3 bandits had in sight ...

the Russian part was very probably to transfer most (all?) assets to Russia , avoiding any kind of liability in the US , while making it impossible for US BK court to seize the "Papers" as already part of what was guarantee to the loan ... unless taking Russian Govt to court ...

But which one ? the Khodorkovsky-case (the russian who bought some thousands Km² of oil field for next to nothing [in the time of Pr. Yeltsin, someone close to him was in Pre. circles] and thought he could get away with refusing to pay income tax = 7 Years of state penitentiary ) has shown that USA court can do all the judgment they want , Russian don't give a damn about ...

and a Russian court wouldn't go against Russian interests (only fair ...)

so the loan would be used to Build the plant , as a kind of mortgage both the Bank (state owned ) and province (owner of land) would become major shareholders ...

which make it VERY difficult for anyone to screw the Russky ...

and do not forget that Etirc has still to demonstrate the capacity of running the plant (Russians wont give extra funds as the project is to be "cash-Flow positive )

if they fail before building is done , no more EAC ...

if they fail after building is done , Russians remains owners of everything ...

so yes , it is a very bad situation for Roel ...whatever is the move it is going to be a blocking one !

to answer dave , yes that was probably the scheme ...
things didn't go as planed ...
EA500 couldn't be finished ...
no needs to state quality or reliability
DayJet couldn't bail-out with IPO

that is the problem with accumulating lies over lies , promises over promises ...
one day you have to face the bill !

Dave said...

I wonder what the Russia people will think when they find out that the first thing Eclipse says will happen with the Russia money is that it will be used to pay bills related to the US that don't have anything to do with the Russian plant. I'd find it hard to believe that Putin considered himself being in Eclipse's next round of financing for US operations.

fred said...

dave :

understand this :

if a single plane ever goes out of Ulyanovsk , NO way a single cent of an eventual profit is going to be spent for deed of EAC in ABQ ...!

this is where the "nice happening" of etirc taking over takes all its meaning ...

flightguy said...

I would almost guarantee that the money is not going to the USA, in particular ABQ.

The remaining employees in ABQ, I hope are looking for safety somewhere else.

As for the Russians, when talking about 800 units a year several months ago from Eclipse and being laughed at by others upon hearing certainly know how to protect themselves. A plant and assets along with a partially completed plane design, how much is that worth? Do you think that they really want to produce an Eclipse? Something that looks like an E500 that has similar engineeering designs, that's another story.

fred said...

and if they do it that way , it has the big benefit of simplifying the questions of "who pays for retrofit "...

owners desiring to keep their toy will have to go to Baboushka-land for fixing or try to find an alternative way in the US ...!

fred said...

flightguy :

you are right !
what is to be understood is that the Russians DO NOT spend a kopeck for Etirc ...

as whatever is to be build is going to remain in Russia ...

if things go wrong , they keep the factory , the papers , everything ...

even if it is currently worth about nothing = no problem = they did not release a kopeck in the wild !!! ;-))

flightguy said...

конец дороги

Dave said...

I would almost guarantee that the money is not going to the USA, in particular ABQ.

However, I think Roel (and previously Vern) plays one side against the other figuring out they'd never figure out what was being said elsewhere. I think they figure that if something is in dutch or russian, it wont make it back here and vice versa if it is in english.

flightguy said...

Russia has really opened up to Americans and business. In particlar, the U.S. dollar. Unfortunately for them the dollar has tanked. Secrets are hard to keep from those in the industry dealing with the same financing institutions in multiple countries. Yes, it was a poor risk on their part, but one that they felt was necessary.

It is the marks that get hurt in the U.S.

конец дороги

fred said...

flightguy :

Kaniechna !!! ;-))

dave :

some times ago , i had a talk with a friend working in President security ...

he is a very nice guy ( i prefer to keep him a friend , pissed-off =he is the kind to peel you off with a big smile ...)

but sometimes he likes to play tough guy ...

so he told me the address (name and N°) of the street where i have been raised in Germany ...

at that time , i didn't even remember myself ...

so YES Vern and now Roel are playing in strange game where they believe one don't know about the other ...

what a surprise it is going to be ...!!!

Dave said...

I guess Casson hadn't heard about the goings on in Russia:
Graham Casson, owner and CEO of OurPlane Fractional Aircraft in Virginia, said Pieper has set much more realistic goals for Eclipse than Raburn, who had promised to eventually produce five jets per day. OurPlane has received only one Eclipse jet to date, although it has ordered 21 more with a $1 million deposit.

“We are still deeply concerned, but I’ve had conversations directly with Pieper and I’m enthusiastic that they will get through this turnaround,” Casson said. “The steps Pieper is taking are severe, but they’re necessary to survive.”

Casson said Eclipse management is now focused on producing only two jets per day in 2009.

“That seems very obtainable,” Casson said. “I never believed Raburn’s ridiculous promises of five planes per day.”

NMBW: Eclipse holds on to customer loyalty
Instead of Vern's ridiculous promises, we get Roel's ridiculous promises.

fred said...

dave :

what credit you give to a guy saying :

" i never believed him , nonetheless i gave him lot of money ..." ?

gadfly said...

Yet, no matter how you slice it, it's still the original can of beans . . . not even close to the promised product . . . and getting worse with every passing day.

gadfly

(And when old "bean cans" show signs of bulging, there is no remedy.)

fred said...

Yes Mr Gad ...

as you said it :
it a very nice can of beans ...
to be sold and resold ...
but don't ever try to taste the content ...!

Dave said...

I just did some checking up on ICON and they've heavy, heavy with the same Eclipse crowd when you look at the ICON board:
ICON Board
We already know that Vern is on the board, but it also turns out Bruce Holmes from DayJet is there as well as Esther Dyson (an investor) who was heavy with Eclipse/DayJet. I respect Esther Dyson's father Freeman Dyson, but increasingly his daughter seems like a huckster involved in businesses that do shady things. Earlier today I read about Space Adventures with how it refused to give a $21 million dollar refund to a customer that it had DQed I thought it was only related in refusal to give refunds to depositors, but it turns out Esther Dyson is tied into this too as an investor:
Wired:Space Adventures Depositor Lawsuit
From the article you can dowload the full complaint.

TBMs_R_Us said...

With a CFO named Crook, what could possibly go wrong???

WhyTech said...
This comment has been removed by the author.
TBMs_R_Us said...
This comment has been removed by the author.
WhyTech said...

"increasingly his daughter seems like a huckster "

This is a bit strong but perhaps directionally correct, IMHO. I have exposure to her in the information technology world, where she seemed mostly a gadfly/hanger on (no offense, Gad!)whose real accomplishments were considerably less than the written description provided in the ICON Board bio. I am always suspicious of folks who allow themselves to be described in terms such as "renowned thought leader" and "internet thought visionary."

TBMs_R_Us said...

"Huckster" and "thought leader" sound pretty much the same to me. I've been exposed to her also, and there is little substance there. There are those who do it and those who run around and pretend to know about what's going on.

Anonymous said...

Throughout the last 100 posts the group seems to be bent on tearing down good folks who did their jobs, and left only after hanging on as long as possible.

Dewey, Matt, and many of the others probably stayed too long … knowing them it was probably their commitment to the customers as much as the Kool-Aid they consumed years earlier. Don’t knock these guys because they are young, or took a risk to work for an upstart company.

At many a meeting they valiantly fought up to the point of being told to shut up. Remember that Matt reported to Mike “The Great Obfuscator” McConnell, and Dewey ultimately to Ken “I’m Helpless” Harness. Dewey often had to fix non-conforming parts, hand build wiring harnesses, whatever … 24/7 whatever it took. Granted there were a number of inflated engineering resumes that proved incapable, but even a great team of engineers can only do so much when the top of the pyramid is manned by buffoons.

Ken is hard at work driving Diamond into the ground, and Mike still can’t seem to just shut up for a few weeks.

Finally, let’s hold our water on the A5 until the Icon Aircraft Critic blog can be formally organized.

Kirk Hawkins used Esther’s FlightSchool events to refine the process of leveraging opportunities to achieve an end. So yes, Vern, Esther, and Bruce are on the Board … big deal … take a look at his varsity engineering team (all former standouts at Rutan’s Scaled Composites) and the marketing team. Yes it is Hollywood glitz … but look what it is doing for that end of the aviation spectrum.

Let’s get back to the real details …

Eclipse was a major investor in DayJet … whatever the conduits to get the cash there, DayJet needed Eclipse, and Eclipse needed DayJet.

The Russians won’t allow Roel to spend their money in ABQ. There isn’t a witness protection program strong enough to protect him from retribution. Not that many would care.

Eclipse is doling out crumbs to all suppliers hoping they will hang on until the domestic financing closes. Unless some politician has it added to the Wall Street bailout, that seems increasingly unlikely.

PawnShop said...

Finally, let’s hold our water on the A5 until the Icon Aircraft Critic blog can be formally organized...

...take a look at his varsity engineering team (all former standouts at Rutan’s Scaled Composites) and the marketing team.


Okay, this is off-topic - but has there ever been a successful certified aircraft that Bert Rutan was involved with? Or a non-certified, serially-produced one?

I can't think of a single one...

DI

Anonymous said...

Was that ever his objective?

But also, did this particular design team ever fall short of their global objectives?

The airplane will be nice. They are marketing it to the disposible income, status crowd, so it will sell. Can they make a profit at $139,000 is the question.

Wait ... let's kit it in the US and assemble in Russia.

What they have in common is that Eclipse, DayJet, Icon ... and most very successful companies ... are working with other peoples money.

Vern's gone fishing and trying to disapear into the wilderness.

Ed still has most of his ~$1B Citrix equity and golden parachute.

We are still whining over how they screwed the masses. Thats capitalism ... and if you could have done it, you would have as well.

PawnShop said...

Was that ever his objective?

I'll take "composite canard turboprop twins" for $300, Alex.

But also, did this particular design team ever fall short of their global objectives?

I'll take "composite canard turboprop twins" for $400, Alex.

As for the dazzling array of non-sequiturs that followed - something on your mind that's bothering you, Zed?

PawnShop said...

OMG, I *totally* missed out on my chance at a cheap shot:

But also, did this particular design team ever fall short of their global objectives?

I'll take "fatal fueling incidents" for $200, Alex.

FlightCenter said...

If Eclipse now owns the DayJet aircraft, they haven’t told the FAA about it yet.

FlightCenter said...

B95,

Production never got up to 6 / week, no matter what the Eclipse press releases say.

CWMR is right about the avionics guys mentioned.

Now if you want to talk about guys that should be held accountable for avionics, look to guys like Burtis, Harness and yes, Vern.

Matt Brown had his share of responsibility, pushing the team to implement features and functions not required for this class of aircraft.

But it was Burtis, operating with Vern’s direction and propagating the reality distortion field that caused most of the problems.

"We’ll be just fine with over a dozen avionics vendors, many of them competitors." "Eclipse can make the avionics and write the software needed to glue them all together."

Once that decision was made, it almost doesn’t matter the caliber of the rest of the avionics engineers that were hired. They were doomed. The complexity of the avionics development problem goes up as the square of the number of vendors. On top of that, Vern had the revolving door going among his senior managers in avionics and program management. They started out as geniuses and ended up as idiots.

FlightCenter said...

B95,

Per your request on documenting the plan for FIKI. – Done

FIKI history is listed in the Eclipse Critic Projections .

Click on the Service Center tab, then scroll over to the right, till you get to FIKI.


BTW, their previous plan (from the July newsletter) was as follows

SN 1- 73 require new de-ice boots.
SN 74 - 266 require Avio NG 1.5 retrofits and other mods.
Rudder spring, Cockpit switch panel, Paint around static ports. Windshield coating. Bonding straps. Static wicks. Wing tip paint. Placards.
SB and retrofit schedule will be released in July

The retrofit plan has now been released, a couple months later than promised.

They say FIKI mods will take 2 -3 weeks because they need to mod the center switch panel.

It sounds like they are planning to ground the aircraft for 2 – 3 weeks, so they don’t have to bear the expense of creating a pool of modified center switch panels that can be available the day the plane comes in for the modification.

What costs more? Down time on a fleet of $1.2M aircraft for 3 weeks or building 10 center switch panels? It would seem to depend on who is bearing the cost.

FlightCenter said...

We are in the final stages of signing contracts...

Translation - We haven’t closed any of these agreements yet.

It is never good business to announce to your customers that you are negotiating a contract with a named vendor.

Very high probability of bad things happening as a result.

FlightCenter said...

Customers with pre NG and ETT modifications will be notified of their modification plan as soon as our financing is received, technicians are hired and trained, and a flow of parts are available.

What is the probability of all those things happening in the next year?

FlightCenter said...

Avio NG 1.3, will be available shortly after the certification of Avio NG 1.5.

You just can’t make this stuff up.

The mind boggles. So people who upgrade to Avio 1.5 won’t have the transponder fixes?

So you can have working transponders or a GPS, but not both?

Will Avio 1.6 will incorporate the Avio 1.3 fixes?

Or will there be an Avio 1.5.1 in your future?

Baron95 said...

FlightCenter said...
B95,

Per your request on documenting the plan for FIKI. – Done


You are just awesome. Thank you.

It beats trying to remember the umbers months into the future.

Baron95 said...

On the avionics engineering leaders, again, from where I sit, and with the obvious limitations of very incomplete info, I maintain that with 10 years and hundreds of millions spent on Avio, even an innexperienced team would have had time to fail twice, learn from their mistakes and do better.

These guys should have known they had to break that project down into incremental releases, each more stable and more functional thtan the previous one.

I'd be very surprised if ALL the Eclipse proprietary SW has more than 1.5M lines of code. They prob spent over $300M on Avio at a cost of $200/line of code vs the $2-$3 industry benchmark. Even if we double that because of vendor integration complexities, the team is still 50 times less productive than the benchmark AND produced imcomplete crap.

ColdWetMackarelofReality said...

Dave I,

Burt's design's have not been commercially successful on the certified scene, but the Rutan Aircraft Factory sold over 8,000 sets of plans for the Vari-Eze and the Long-EZ, and there are about 2,000 of them flying - Only the Van's RV series outnumber Rutan planes at any major EAA fly-in.

Burt's success in the experimental field led to Scaled Composites and ultimately to the first private space shot - not bad.

Oh yeah, Burt designed the original V-Jet as well as the Pronto jet, which became the original layout for the Eclipse 500 - so he is still batting 0 in terms of commercially successful certified aircraft, although he has drawn some memorable shapes (Starship, Visionaire).

Honestly though, it would not be fair at this point to saddle him with the failure of the Eclipse.

Baron95 said...

Did I mention that there is no excuse for it?

Oh, BTW, there is NO EXCUSE for it. You can't be that bad if you wanted to. Hire some interns from CS school and ERAU and in 10 years they'd have tought theselves how to do the job 10 times better even with Vern breathing down their necks.

This was a royal screw up!!!!

Did I mention that there is no wxcuse for it?

Baron95 said...

On a sad note, I just got an email from a Cape Air friend that they lost a 402 tonight on departure from MVY. Luckly it was a repositioning flight to Logan and there were no passengers on board, but the pilot, the sole occupant, did not make it. My prayers are with the family.

For those that don't know, Cape Air is the largest independent regional airline in the US and adds color to the Cape and the Islands - they even have a code share with B6. I think they have over 50 C402s, and were looking at VLJs, including the Eclipse, at one point.

Sad story for an airline that has managed an outstanding safety reccord, despite the 2005 FAA medling, in the very unforgiving Cape environment with almost an all Piston fleet (they do have one ATR, I thin).

I hope this does not stop their growth.

Baron95 said...

And if you want a sample of what can happen when an OEM goest Tango-U, the Diamond thierlert users group is reporting that "33% of the fleet is AOG, and another 25-30% have chosen to voluntarily ground their aircraft due to the high operating costs following the insolvency."

Nasty. Luckly for those, Diamond may have a replacement engine later this year, but it will cost the owners a good $70K or so to upgrade and they may have to wait for over 1 year due to production constraints.

fred said...

#Did I mention that there is no excuse for it?#

yes ...

it is said that if you put one hundred monkey in a room with typewriter , you'll end-up (at some point) with the complete works of Shakespeare ...

for this , i agree with you
(i need to see doctor ... ;-) )


but i think the overall goal of spending 50 times the standards was to spread the losses of the "DayJet Deal" ...

a kind of loosing any accountant trying to sort-out the mess that EAC account-books must be ...

which goes very well with the idea of "planed from day 1"

and can explain why the guys were so incredibly bad at writing few coding lines ...

not strictly their fault , everything was meant to make it long ...

to justify the use of so much money !

this goes as well with the idea of having a multi-suppliers thing : big firms with all clever manpower , sometimes mess up totally integration of 2 of their own stuff ...

how could it work with different , being competitor one with an other ...

fred said...

zed :

i am sorry to disagree ...

i was working myself (few years ago) in W.S.
ok , may be the simple fact of being a foreigner pushed me to react this way ...
but at some point , i was in fear to puke by seeing the guy in the mirror when i was shaving ...

i decided to quit , difficult choice , my yearly was in 6 digits + bonus ... ! ( just remember that we had a joke = "what is a bonus ? paying you a few hundreds thousands for not using the toilets too often !" )

so , it is not a question of capitalism ...

more a question of greed ...

when greed get over humanity or mankind well being , nightmare are always at the corner ...!

WhyTech said...

"Nasty. Luckly for those, Diamond may have a replacement engine later this year, but it will cost the owners a good $70K"

The buyers of this acft did not do their homework. Why buy an acft with an engine from an unproven supplier? History paints an unmistakeably clear picture of the risks for all to see if they will only look.

WhyTech said...

"Let’s get back to the real details …"

Actually, people ARE the real details. People make it work, and people make if fail. It all begins and ends with the people involved.

airsafetyman said...

"If Eclipse now owns the DayJet aircraft, they haven’t told the FAA about it yet."

I think Eclipse ALWAYS owned the DayJet aircraft.

As for everyone screwing their customers through capitalism, I disagree. Ed was sitting on a billion dollars and still sent up pilots and passengers every day in falling-apart airplanes without weather radar? Ed does not have the respect of anyone in aviation that I know of, or his former employees either. All you have in this world is your integrity and reputation and Ed has soiled his. Hope he enjoys his eight million dollar house.

I AM NOT VERN said...

To Baron:

I assume you fly Cape Air? As a pilot you must cringe each time you board one! I'm forced to make the occasional flight on Cape over to ACK. As you are aware the 50 C-402s are all basket cases. The planes are a disaster. It is a miracle they haven't killed a plane-full of people sooner. Not one of the 50 has (as near as I can tell) has GPS. Many have nothing more than the basic wing levelers that were installed when the planes were new. The lack of a good autopilot when these planes fly into hard IMC on a regular basis should be criminal. The headliners are falling down, the paint is peeling and chipped, the instrument panels have (literally) coffee can bottoms covering empty holes. Many don't have anti ice. I doubt they have one airframe with less than 20,000 hours. I could go on forever!

Yes, the are a good airline from the standpoint they don't leave you stranded and they do everything possible to accommodate the customer. It is the only airline left that will fly the passenger along with their cat, dog, ferret, or snake. Still, their fleet is LONG, LONG past the prime and it is ONLY a matter of time before 9 people are killed!

The company has expanded rapidly. It is time they put money back into the fleet. At one time they, along with Island Air, owed the ACK market. Today you see anyone who can afford something else flying into ACK in a Caravan, PC12, SR22 or the occasional Piaggio.

For those that don't know, Cape Air is the largest independent regional airline in the US and adds color to the Cape and the Islands - they even have a code share with B6. I think they have over 50 C402s, and were looking at VLJs, including the Eclipse, at one point.

Anonymous said...

Eclipse is testing the EA100:

http://www.cnn.com/video/#/video/world/2008/09/26/vo.uk.rocket.fusion.man.landing.itn

The new concept is the "self fly" air taxi model where every passenger gets a wing and a parachute. When they get near to their destination, pop the chute and float in. Without the new for airports, this model supports door to door service (well, field to field anyway).

When asked about the need for the initial climb and drop, company officials explained that Catapult 1.5 will provide that capability and all customer will be upgraded to that for free.

"The ratio of four jet engines to one passenger is a new record in safety" said officials. Deliveries are expected to start next Tuesday with service beginning the prior Monday. Cost for EA100 is $670 in 1903 dollars.

WhyTech said...

"Deliveries are expected to start next Tuesday with service beginning the prior Monday. Cost for EA100 is $670 in 1903 dollars."

Way disruptive!

Deep Blue said...

A few comments concerning EAC, Icon, Dayjet.

One issue that all three of these ventures bring into question is whether or not there is demand for these products and services, such that a business can be built.

For Dayjet and EAC at least, their focus on volume and scale over-rode almost all other considerations.

Imagine DJ if it just focused on say 5 jets, 5 city pairs and raised about 15MM in working capital, then perfected its marketing, pricing and operations routines.

Imagine EAC if it approached the E500 like it apparently did the E400: built say 5 E500 concept jets, got them into the market, sought customer feedback; tracked operational performance; perfected avionics and systems first then developed a production and cost basis to scale production up or down ("mass customize") based on real time demand.

As for Icon, it doesn't appear to be making a commitment to high production as EAC did, and may be able to function more as a "custom" aircraft builder.

The niche and developmental ventures in GA are going to have to learn to live in a low volume world in the medium term.

As for Esther, Dave, she is indeed rather eccentric but trades on the "personal mobility" movement and has been generally a positive supporter (in some cases putting cash on the table) of entrepreneurs trying to bring to market new products and services.

Deep Blue said...

Cape Air was brought up.

If you take a look at its network (NE is about 15 cities with frequency sufficient to adress business and leisure with seasonality affects) it's actually a better incarnation of "DayJet" than Dayjet was. The C402 is a better air taxi cabin (I'm not including the engines) than a VLJ (pax and bags load) and a schedule and route system is a better fit to the market than a DJ-like auction system.

It's odd that they haven't been able to re-fleet (although their management is not likely very sophisticated).

I agree with the comment about the condition of their planes, however. Frightening.

Anonymous said...

Deep Blue said...

I agree with the comment about the condition of their planes, however. Frightening.

GA planes are simply not built for airline service. They have had wing spar cracks and engine failures.

What does this say about using EA500s for high cycle air taxi? Not going to be a good thing. What is the market for EA500s from the Russian plant? 2,000 orders from air taxi. Doesn't add up.

eclipse_deep_throat said...

from today's paper, apparently the Ruskies will cough up $330 million.

E.D.T.

Saturday, September 27, 2008

Taking Off in Russia


Journal Staff Report
Netherlands-based ETIRC Aviation flew one of its Eclipse 500s to Ulyanovsk, future site of an assembly plant for the very light jet, where it was inspected on Sept. 12 by Russian Prime Minister Vladimir Putin and other government dignitaries.
The inspection came three days before the Vnesheconombank supervisory board, chaired by Putin, announced its approval of financing for the assembly plant. Also known as the Bank for Development and Foreign Economic Affairs, Vnesheconombank initially reported that the plant was a $205 million investment. In an e-mail to the Journal on Wednesday, the bank reported that its investment was $330 million.
A subsidiary of the European Technology and Investment Research Center, ETIRC Aviation — not Albuquerque-based Eclipse Aviation — will operate the Ulyanovsk plant. The company has exclusive rights to assemble, sell and service the 500 jet in Europe and Russia.
Roel Pieper is CEO of both Eclipse Aviation and ETIRC Aviation. In addition, the parent company ETIRC is a major investor in Eclipse.
Eclipse's Albuquerque operation has a maximum capacity to produce 1,200 jets a year, while the Ulyanovsk plant will have a maximum capacity to make 800 jets a year, said Eclipse spokeswoman Alana McCarraher. However, it will likely take several years before either operation reaches maximum capacity, she said.

Dave said...

Eclipse's Albuquerque operation has a maximum capacity to produce 1,200 jets a year, while the Ulyanovsk plant will have a maximum capacity to make 800 jets a year, said Eclipse spokeswoman Alana McCarraher. However, it will likely take several years before either operation reaches maximum capacity, she said.

2000 units per year - heavy toadlicking going on at the Eclipse/ETIRC executive offices! No wonder Roel was claiming there'd be 2000 additional orders that would be just one year's worth of backlog.

Deep Blue said...

It's instructive that only the "Russians" are apparently investors here.

Why not Boeing; EADS; Northrup Grumman; Fuji; Mitsubishi; EMB; Textron; Gulfstream/GD; Bomb/Canadair?

Why only a third world "criminal" regime? Why only a government (bailout?); why not an actual industrial commercial company?

This is all very interesting media, but the demand side, the actual potential users, corporations, et al will never buy into this.

airtaximan said...

Just when you thought it would get boring...

The BS-meter is flying HIGH...

Give'm credit - they can BS the whole world... even foreign governments in a few different languages!

Maybe Vern wasn't so good at this afterall... looks like Roel beats him hands down.

Still, not one really wants their POS product - some will settle as its all they can afford - otherwise, they'll buy something else.

Kudos... $330M should be enough to begin refunds and paying suppliers, no?

Baron95 said...

I AM NOT VERN said...
To Baron:

I assume you fly Cape Air? As a pilot you must cringe each time you board one! I'm forced to make the occasional flight on Cape over to ACK. As you are aware the 50 C-402s are all basket cases.


Actually, I have never flown them. But I have said many times here, I do fly my Baron often to the Islands and cape (ACK, MVY, BID HYA, MTP, etc). I know some of the Cape Air pilots and I am good friends with a couple. I love to see them flying the islands routes. I see the happy faces of the passengers boarding/deplaning them all the time. It is like an adventure for them - part of the Cape/Islands' mystique - get them closer to GA. Passengers talk/interact with the crew, etc. It is a wonderful sight (for me).

As for avionics, for the sub-30 min, 3,000 ft single VOR pair + occasional ILS mission they fly, they don't need a lot of avionics or AP functionality.

The only way that market can work is with sub-$500K planes and very frugal fuel consumption - it is very seasonal, as well.

But I agree - they are old planes on a fix-what-breaks basis. Kinda like the AA MD-80s and A300s.

Incidently, some one asked if there were ever any planes designed with the Part 135 market in mind - The 402 was designed exclusively with that market in mind. Same with the Chieftain. These (and other planes like them) are the 135 workhorses.

There all in (finance, maint, fuel, etc) CASM is probably 10% of what Ed's Eclipse fleet was.

CASM = cost per available seat mile for those that don't know.

Baron95 said...

Attention Eclipse Owners and Position Holders: This is mandatory reading for you

You should follow on the footsteps of the Columbia and Diamond Thierlert Owners Group. They successfully organized, pooled money, hired a law firm, enabling owners to file their claims against the bankrupt firms as creditors. They exerted a lot of pressure on the Bankruptcy courts, FAA and EASA to enabled their planes to continue flying and to soften the blow of the loass of value/utility in the bankruptcy.

You would do well to read the entire site and copy everything they did PRONTO.

They did (Columbia) and are (Thierlert) fighting for example to prevent the B court to discharge warranty and support contractual obligations on a reaorganization sale.

It is hard to believe that you (the E500 Club) haven't done that yet. But better late than never.

Dave said...

I second what Baron says. If any depositors, suppliers, owners, etc didn't think Eclipse had already jumped the shark, saying they'll make 2000 units per year is serious shark jumpage.

Dave said...

Vnesheconombank initially reported that the plant was a $205 million investment. In an e-mail to the Journal on Wednesday, the bank reported that its investment was $330 million.

That doesn't make sense. Why would the Russian government bank be emailing the ABQ Journal? Also it was Eclipse themselves who reported it was $205 million in a press release less than a week ago:
VEB announced that it expects to finance the project in full, with a total value of $205 million. VEB and the Ulyanovsk region administration will be among the shareholders of the enterprise.
PR: Eclipse Aviation and ETIRC Aviation Gain Approval and Financing for Russian Production Facility
In any event, this clarification gave 125 million more reasons why Eclipse should be issuing refunds and paying their debts.

TBMs_R_Us said...

In any event, this clarification gave 125 million more reasons why Eclipse should be issuing refunds and paying their debts.

Except, Dave, none of this is an investment in Eclipse! It's all funny money for the Russian plant. None of it puts funds into Eclipse until the Russians need to purchase something from ABQ. Given that the plant couldn't possibly be in operation until 2010, there's nothing to buy. So EAC still needs to find $500M to fund just the losses for 2008 and 2009, from an investor willing to put it into ABQ.

Dave said...

Except, Dave, none of this is an investment in Eclipse! It's all funny money for the Russian plant. None of it puts funds into Eclipse until the Russians need to purchase something from ABQ. Given that the plant couldn't possibly be in operation until 2010, there's nothing to buy. So EAC still needs to find $500M to fund just the losses for 2008 and 2009, from an investor willing to put it into ABQ.

That isn't what Eclipse is saying, so since they are saying they'll use the money soon they should have consequences for what they say. Frankly I think the email was spoofed (by either Eclipse or ETIRC) to be from the VEB as it just makes no sense why the Russian bank would email the ABQ Journal.

TBMs_R_Us said...

Could you post where Eclipse says they are getting the funds for ABQ?

Dave said...

Here's Mike McConnell calling the VEB funds an alternative to UBS:
The Ulyanovsk plant will have the capacity to build up to 800 Eclipse 500 aircraft per year, as well as provide customer support services, according to Eclipse. But ETIRC isn't obligated to invest all of the $205-million in the Russian facility. An undisclosed portion of VEB's will be paid directly to ETIRC essentially as a production rights fee, potentially providing a much needed cash infusion to the struggling Albuquerque firm, in which it hold a sizable interest. ETIRC will use another part of the funding to build the physical facility at Ulyanovsk. ETIRC will pay the remainder of the money to Eclipse to provide tooling, engineering services, training and quality assurance.

However, the timing of the funding has not been announced.

Pieper, who is also Eclipse president, is working with UBS to secure underwriting of a new $200- to $300-million investment in Eclipse to resume normal operations in 2009. Eclipse expects to receive either the VEB funding or a substantial cash infusion underwritten by UBS by Oct. 31st.

"The good news is that either source will come in, in time," Mike McConnell, president and GM of Eclipse's customer division, said confidently. "When it comes in, our priorities will be to settle our relationships with our suppliers, take care of our customers and resume normal operations in 2009."
Sources close to Eclipse estimated that the UBS investment to be as much as $200-300 million.

Aviation Week: Russian Bank Okays $205 Million for Eclipse

Shadow said...

Press release from VEB, which says $205 million and not a penny more.

I agree with airtaximan: the BS meter is reading off the scale, here. And pay no attention to the man behind the curtain, ya'll.

Dave said...

I agree with airtaximan: the BS meter is reading off the scale, here. And pay no attention to the man behind the curtain, ya'll.

I'd LOVE to see that email that was sent to the ABQ Journal that supposedly came from the VEB essentially saying "We're giving $330 million, not $205 million!" I'd like to trace the email to see where it really originated from.

Anonymous said...

HOLY CRAP!!!!

I haven't tasted Kool-Aid like this since Jonestown.

Previously posted by Dave:
NMBW Kool-Aid

Captain Picard said it best:
The Picard Manuever

To be fair, not all of Mr. Robinson-Avila's articles are so "optimistic", however this one is ridiculous.



Hey, look! There's a comments section... and it's open.
Comments are open

Harpoons, man them!

just zis guy, ya know? said...
This comment has been removed by the author.
Baron95 said...

Still, you are all missing the point. There is an entity willing to put $205M or so in financing related to production of the EA500, when none of you (us) can see how this can ever generate enough profits to re-pay the loan.

What gives? Either they know things we don't know or they chose not to see the things we do know.

Still puzzling to me why anyone wuld make such investment. Particularly, since production capacity is NOT Eclipse's problem, given that they are now producing at 1/6th their recently demonstrated production capacity.

Dave said...

Still, you are all missing the point. There is an entity willing to put $205M or so in financing related to production of the EA500, when none of you (us) can see how this can ever generate enough profits to re-pay the loan.

What gives? Either they know things we don't know or they chose not to see the things we do know.


Actually we aren't. Some of the bloggers on here believe that Eclipse/ETIRC has to demonstrate additional financing to show that they can afford to buy parts, pay employees, etc rather than this financing just taking care of everything and not putting any performance requirements onto ETIRC. What has been stated by the VEB was that the $205 million was for the building of the factory, not that it was for parts, tools and employee salaries.

Baron95 said...

Details...details....

Some entity is throwing $200M+ towards an effort that has consumed $1.2B and counting with no real prospect at a positive return.

If you are not asking WHY, you are missing an important question.

I'd like to know one single palusible reason as to WHY anyone would do that? Surelly VEB can find better things to finance in Russia, right?

«Oldest ‹Older   401 – 600 of 622   Newer› Newest»