Mooney Business Case?

[chrisk]

I'm quite excited with the news that the Mooney factory is starting up again.   I hope they get enough orders on new planes to make a go of it. 

 

But, I wonder if there is also another route that is possible, at least to provide some short term income.    I'm thinking there are a whole lot of M20Ks out there that could be converted to 252s.   Or maybe even a new engine.  Is this something the factory can do without to much hassle from the FAA?   Could they even make it competitive in cost? 

[Seth]

I like the way you think.

 

Or a diesel conversion for the short, mid, and long bodies.  Or the small Rolls Royce Turbine they were talking about five years ago going onto the front of the M, R, or TN.

 

-Seth

[Danb]

It would be awesome to be able to take in the J's and K's and recondition them to like new spec. ,paint, interior, avionics, engine the whole smear..there are a lot of great airframes out there which I believe would be a great market to bring them up to new condition and into this generation

[carqwik]

The market will be for China...once GA is allowed into the airspace (and that's starting to happen), expect to see the more wealthy Chinese being flown around in small GA aircraft by a hired pilot...that's the future market for Mooney. 

[benpilot]

I'd like to see Rocket engineering start offering the upgrades again for Mooney aircraft.

[Seth]

The market will be for China...once GA is allowed into the airspace (and that's starting to happen), expect to see the more wealthy Chinese being flown around in small GA aircraft by a hired pilot...that's the future market for Mooney. 

 

For those missions they will most likely go for a six seater Bonanza/Matrix type aircraft with a club cabin configuration.  If you are the owner and to be flown around, you'll sit in the nice cabin with a passenger door or airstair.  Then again, the average Chinese citizen may have no issue with the "twist-plop" to get in the back seat of the Mooney or will be happy at the co-pilot controls.

 

The economic pilot who flies themselves think about the Mooney as they will be flying it and can keep costs down.  If you can hire a pilot, you aren't worried as much at operating costs between a Matrix/Bonanza and Mooney.

 

-Seth

[ArtVandelay]

It would be awesome to be able to take in the J's and K's and recondition them to like new spec. ,paint, interior, avionics, engine the whole smear..there are a lot of great airframes out there which I believe would be a great market to bring them up to new condition and into this generation

There is already a precedent in the boat industry for this. Pacific Seacraft started doing this after the 2008 downturn, they will refit your boat, upgrade it or just make it like new again.

[RJBrown]

I would not expect Rocket to do any more conversions. The current market would not support it based on resale of current Rocket products. Conrad and his business has "outgrown" the Mooney business. The market to do turbine conversions is too good to bother with us. Each Propjet is equal to 10 Mooney conversions from a money standpoint. It is both not worth their time and there is no market.

[Guest]

I really can't see Mooney buying up older airframes, refurbishing them, then selling them to compete with their own current production models. The same reasoning that they never offered upgrades to the F model by way of factory kits, making it compete with the J model.

This market is left to others to develop.

Clarence

[Cruiser]

I'm quite excited with the news that the Mooney factory is starting up again.   I hope they get enough orders on new planes to make a go of it. 

 

But, I wonder if there is also another route that is possible, at least to provide some short term income.    I'm thinking there are a whole lot of M20Ks out there that could be converted to 252s.   Or maybe even a new engine.  Is this something the factory can do without to much hassle from the FAA?   Could they even make it competitive in cost? 

only problem with this is a dealer network.

[John Pleisse]

From 2003 to 2007, the factory operated its own MSC and refurb operation. You could get regular maintenance, major alt and repair, newer interior refurbs, panel work and even paint. I am not sure if it proved viable for them or not. I think the ongoing gripe among owners was geographic location and a high price strata.

[aviatoreb]

This is interesting - a secret military market developed Lycoming Diesel - for UAVs.  Roughly equivalent to a 200hp Lycoming 360, and turbo charged, 2000 TBO and no earlier gear requirements.

 

http://www.avweb.com/avwebflash/news/Lycoming-Diesel-Details221664-1.html

[KSMooniac]

I really can't see Mooney buying up older airframes, refurbishing them, then selling them to compete with their own current production models. The same reasoning that they never offered upgrades to the F model by way of factory kits, making it compete with the J model.

This market is left to others to develop.

Clarence

The difference between then and now is the J replaced the F, so they definitely didn't want to hurt sales of the J.  Today, with the only products being a $500-600k R and TN, there is a gaping hole between the $50-100K "vintage" plane and their current production in which to play.  Safe bet that those of us enjoying planes in the this price range, and perhaps even up to $150-200k, are not likely customers of new planes and thus they wouldn't cannibalize a sale of a new one if they were to pursue such a course.  Not to mention the capability of a mid or short body plane vs. the current long-body big engine planes... two different markets.

 

My only question is why they charged so freakin' much for things like interior upgrades.  Perhaps any service or upgrade by the factory reset the theoretical 18 year liability clock?  I have no idea.  They are in a biz-friendly state and in one of the lowest cost regions, working in an old facility that should've been paid off long ago.  The marginal cost to do upgrades should be tiny...and it would've kept the skilled workforce busy during the downturn.  Instead, they got scattered into the wind...

[KSMooniac]

This is interesting - a secret military market developed Lycoming Diesel - for UAVs.  Roughly equivalent to a 200hp Lycoming 360, and turbo charged, 2000 TBO and no earlier gear requirements.

 

http://www.avweb.com/avwebflash/news/Lycoming-Diesel-Details221664-1.html

 

That got me excited right up until the point Kraft said it would cost twice as much as today's old-tech gas engines.  They also didn't mention the weight... I suspect it will weigh a LOT more than a turbo'd IO-360 gas engine, and of course the fuel is heavier too.

[Hector]

It would be awesome to be able to take in the J's and K's and recondition them to like new spec. ,paint, interior, avionics, engine the whole smear..there are a lot of great airframes out there which I believe would be a great market to bring them up to new condition and into this generation

Agree completely. I just don't know if Mooney can survive on upper end Ovations and Acclaims alone. Lets face it, these aircraft are going to be pushing $1M. How many can they sell here? Is there no room in the market for a new J? I've heard the argument before that there really isn't that much difference in cost for Mooney in building a J vs an Ovation but I think they need to figure out a way to offer something that is more financially viable for folks. New J's or a rebuild/refurbish program might bring in more business. Then again, heard on the news today that China now has over one million millionaires. Maybe Mooney does not even need the US market anymore.

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[triple8s]

There will probably be commercial pilots from all over the world moving to China to be personal pilot for the rich Chinese. In the last 30 years there has sure been a transfer of wealth from this country to theirs.

[TWinter]

If Mooney does not offer "something" for the existing fleet of 7000 owners such as refurb programs, better parts availability and support for the current owners and instead only focuses on the "Millionaire" populous for new birds I really don't see the new revitalization much different then the road of the past...and we all know where that took them.

 

When they first announced the resurrection of Mooney people stood up and noticed. I think the Mooney market might have even taken a slight upswing..(if that's even possible in GA with the current economics). 

 

I think if some effort was made to keep the middle class group (like me) flying my 73 E Model and helping to keep parts and refurb services available included as a major part of their business plan it would have more teeth and a better chance of working.

 

I guess in a nut shell..  A silly analogy, but good comparison. I hope they won't keep swinging at the pitch hoping for the homerun every time just trying to sell the new million dollar Mooney to the millionaires. Instead go for the base hits to help us keep our birds up to date and offer refurb/repair services etc. Keep swinging to get men on base (keep us in the mix), the millionaire homeruns will come.

 

There are about 7000 Mooney owners and birds registered (approx.) I know I spent 50K+ last year in upgrades. Not going to be an average number, but there are a few of us that keep pumping money into the aging fleets.  Just my .02. 

[Cruiser]

What am I missing? Does new paint, new engine, interior and avionics from the Mooney factory somehow make a used plane better than the new paint, new engine, interior and avionics we can now get from the marketplace ?

 

There are a few companies that specialize is this, but I suspect it is a niche market that not many owners participate in. Why would that change if the factory did it? 

[TWinter]

Not talking about the easy stuff like paint, engines or aftermarket parts etc.. I'm talking about smaller Mooney specific items. The things that break and you have to buy from a salvaged Mooney. I know I have some plastic that needs replacing, "Plane Plastics" does not carry it. How often do we see posts from MS guys asking for this or that?. What about the small mixture knobs somebody was looking for a while back. I don't expect Mooney to be like Ford or GMC for parts availability, but I would like to see some of the specialized smaller items be something they consider being available. Even larger pieces like skins or rods. Salvage parts are great and inexpensive compared to what you buy from factory, but what about that odd part no salvage company happens to have that keeps my 73 or even newer bird grounded until the owner finds a certified replacement. I would be willing to spend the extra for a factory produced part instead of polishing and waiting for a salvage part show up.

 

I'm all about selling the million dollars birds. I just think there will be a limited market if they place all the focus on new sales. If you have 7000 of us already buying hard to find parts and refurb services I would think that knowing there is 7000 smaller buyers looking for hard to get parts would be a bird in the hand (no pun intended). Unfortunately, I won't be in the millionaire line buying new. I'll be in the line looking for the weird part only Mooney made like the replacement panels to keep my 73 flying.

[Hector]

What am I missing? Does new paint, new engine, interior and avionics from the Mooney factory somehow make a used plane better than the new paint, new engien, interior and avionics we can now get from the marketplace ?

There are a few companies that specialize is this, but I suspect it is a niche market that not many owners participate in. Why would that change if the factory did it?

I was not thinking in those terms alone. Yes agree anyone can repaint and repair stuff, but not a lot of folks have the resources and engineering staff to actually develop improved parts/products for our aging fleet. They could do a lot with that.

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[BigTex]

Anyone that has built an aircraft knows that the cost of the plane is not the airframe.  It's firewall forward, avionics, interior and paint.  For aircraft manufactures the other major cost of labor and other overhead expenses.  So if you look under the covers of where the costs go, it's those items, not the airframe.

 

For those that say why not restore an old 201's.  I would bet that there would be more labor costs associated with the restoration of an existing aircraft than building one from raw materials.  So basically it would be very hard to make a business case for Mooney to buy up older airframes and restore them.

[Rhumbline]

Anyone that has built an aircraft knows that the cost of the plane is not the airframe.  It's firewall forward, avionics, interior and paint.  For aircraft manufactures the other major cost of labor and other overhead expenses.  So if you look under the covers of where the costs go, it's those items, not the airframe.

 

For those that say why not restore an old 201's.  I would bet that there would be more labor costs associated with the restoration of an existing aircraft than building one from raw materials.  So basically it would be very hard to make a business case for Mooney to buy up older airframes and restore them.

 

Perhaps.  The implausibility of a more affordable new airplane with a four-banger, basic features and minimal avionics has already been amply argued in other threads as well.  Augmented and continuing parts support of an existing fleet spanning decades may be equally unrealistic.     

 

Were I a betting man, I'd place my money on Mooney's bumping along with tepid sales of new airplanes until there is improvement in the economy combined with an increased interest in personal aviation, the concern moves offshore or it ends up in mothballs again.    

[Cris]

If Mooney were to offer a zero timed airframe and engine together with a standardized avionics suite they would have a competitive market advantage over what is available now thru 3 rd party sources. Possibly upgrade all airframes to the latest version mfg. with new serial numbers.

Price that product at 1/3 to 1/2 of a new Ovation perhaps limiting it to just J/K airframes together with some of the latest technological upgrades hinted at by Mooney like FDEC.

Offer a one year warranty or more.

Presell this option so that economies of scale would be effective without a factory commitment. Insist on 100 owners or potential owners are on board prior to starting the program. This would provide a safety net for the factory in setting up an assembly line.

[Cruiser]

How is it possible to zero time the airframe?

 

Now, if Mooney could take in an old airframe and re-certify it as new 2014 with all the upgrades. That might have some value.

[Cris]

How is it possible to zero time the airframe?

Perhaps a better way to phrase it would be a remanufactured airframe analogous to a remanufactured engine with a zero timed logbook only available typically thru the manufacturer. Here is an internet description.

REMANUFACTURE AND UPGRADING

The most elaborate type of program under the general heading of maintenance is the remanufacturing process. Performed at aircraft-manufacturing facilities, remanufacture is a measure that combines a general overhaul with an upgrade of some of the aircraft’s systems. The latter process often paces the progressive development of a basic airplane type through several models, and it incorporates design changes and improved onboard systems dictated by service experience with the original model. Thus, if a particular model in service still has years of useful life, it is more economical to upgrade its systems by remanufacture than to build an entirely new aircraft.