Mooneymax

[exM20K]

On 9/10/2024 at 7:38 AM, Pinecone said:

Return trip was 12 hours from hotel to home

And it’s on their schedule, not yours.

-dan

[Texas Mooney]

5 hours ago, Pinecone said:

said that the issue was the 4 - 6 month lead time, and they have not had the funding to guarantee that Mooney would be open to receive, inspect and deliver the parts.

Sounds like they are just barely making payroll and paying utilities.  And are in danger that any unexpected or annual bill will put them under.  I wonder if the MSC's have to pay in advance to order parts from Mooney.  Then they are the ones directly at cash risk of a Mooney default - in addition to not being able to support the brand.

[Marc_B]

I gather the Mooney factory and their FAA production certificate are assets that Mooney Aircraft Corp is trying to leverage to salvage the company or to sell.  However many of the parts used in our aircraft were not produced by Mooney but WERE certified by Mooney.  So the rub is that in order to certify a part from Mooney it's not something that you can just order yourself.  Think of it as "chain of custody."  i.e. to produce a main landing gear retract tube, Mooney has to order the rod end bearings from a third party and most of these aren't something that you can just order 1 or 2 of.  So there's a wait to reach a minimum, a lead time for build, and a lack of free capital to purchase 3rd party components.

Sounds like Mooney would consider ordering with prepayment, but with a significant lead time there's a good chance that things would change in that time which would be a potential liability for the Co as well as for the purchaser.  With a large order, significant group order, or a significant investment it might make sense for Mooney to consider.  For <5-10 of a product, it probably doesn't amount to anything but liability.  The economy of scale is counterproductive with low quantities, and below a certain number it may actually be a net loss.

So the hope is that Mooney Corp can ramp up production of parts using their production certificate (?) which can stabilize the parts manufacture for other aircraft parts/government contracts, improve the economy of scale, and allow the ability to continue to also manufacture Mooney parts with a sustainable profit margin.

[Marc_B]

As an aside, I've found that many times even if you reach out to the company that manufactures a component, i.e. a spring, they'll be happy to sell to you but have a minimum purchase of 1000 parts.  So the tipping point will be when it's no big deal for Mooney to purchase 1000 parts when they only have 3 current orders.

[BlueSky247]

With all that going on, one wonders how they are still squeezing out new acclaims. 

[Danb]

There not..

[BlueSky247]

You would think so, but they’ve had a blurb on the website for months now. Apparently some almost done ones being finished off if someone signs a check. 

[donkaye, MCFI]

15 minutes ago, BlueSky247 said:

You would think so, but they’ve had a blurb on the website for months now. Apparently some almost done ones being finished off if someone signs a check. 

Definitely not true.  We saw it all and there were no airplanes on the line except for the experimental Acclaim in the Service Center that they are getting certified and readying to sell.

[Hank]

2 minutes ago, donkaye said:

Definitely not true.  We saw it all and there were no airplanes on the line except for the experimental Acclaim in the Service Center that they are getting certified and readying to sell.

At one point a few years ago, they did advertise the ability to finish off the last one or two from near the end of the line. Maybe the year after the shutdown when Beijing cut funding?

[donkaye, MCFI]

22 minutes ago, Hank said:

At one point a few years ago, they did advertise the ability to finish off the last one or two from near the end of the line. Maybe the year after the shutdown when Beijing cut funding?

Those were sold long ago.  The experimental plane was the one used in the certification of the Acclaim ultra.  

Jonny is a very "UP" kind of person.  I did not sense that this time. 

[LANCECASPER]

41 minutes ago, BlueSky247 said:

You would think so, but they’ve had a blurb on the website for months now. Apparently some almost done ones being finished off if someone signs a check. 

They finished an Acclaim Ultra and sold it in November 2021 and as @donkaye mentions serial #0001 of the Acclaim Ultra could be ready soon.

There is one airframe off to the side of the assembly line that they stopped right at the point where it would have progressed either as an Acclaim Ultra or Ovation Ultra. That one could also be finished as either model if they had an order and deposit. 

[1980Mooney]

3 hours ago, Marc_B said:

I gather the Mooney factory and their FAA production certificate are assets that Mooney Aircraft Corp is trying to leverage to salvage the company or to sell.  However many of the parts used in our aircraft were not produced by Mooney but WERE certified by Mooney.  So the rub is that in order to certify a part from Mooney it's not something that you can just order yourself.  Think of it as "chain of custody."  i.e. to produce a main landing gear retract tube, Mooney has to order the rod end bearings from a third party and most of these aren't something that you can just order 1 or 2 of.  So there's a wait to reach a minimum, a lead time for build, and a lack of free capital to purchase 3rd party components.

Sounds like Mooney would consider ordering with prepayment, but with a significant lead time there's a good chance that things would change in that time which would be a potential liability for the Co as well as for the purchaser.  With a large order, significant group order, or a significant investment it might make sense for Mooney to consider.  For <5-10 of a product, it probably doesn't amount to anything but liability.  The economy of scale is counterproductive with low quantities, and below a certain number it may actually be a net loss.

So the hope is that Mooney Corp can ramp up production of parts using their production certificate (?) which can stabilize the parts manufacture for other aircraft parts/government contracts, improve the economy of scale, and allow the ability to continue to also manufacture Mooney parts with a sustainable profit margin.

"I gather the Mooney factory and their FAA production certificate are assets that Mooney Aircraft Corp is trying to leverage to salvage the company or to sell."

The Factory is an "asset" when operating but not one that Mooney can technically sell.  Mooney leases the facility from the Kerrville -Kerr County Airport.  In 2004 Mooney entered into a 30 year lease that escalates.  In 2014 it was revisited, the lease was raised to $6K per month rising with the CPI for the remaining 20 years to 2034.  With current inflation it is probably $8K/month.  As long as Mooney is manufacturing and the lease is appropriately priced, the company's "manufacturing capability" is an asset.  But if a lot of it is idle and unused then it is a liability.  In the past there were comments that the Chinese owners made investment in the plant building like improved lighting.  Well although all those improvements were paid for by Mooney and its Chinese owners, they  are now owned by the Lessor - Kerrville-Kerr County Airport, since the are part of the building (leasehold improvements).  If someone buys the stock of Mooney Co. then they can continue to take advantage of or "leverage" (as you said) the "manufacturing capability" but Mooney Co. cannot sell the factory facility.

https://www.aero-news.net/FullsizeImage.cfm?do=main.textpost&id=60120554-46DA-4B3B-9570-3455356CD184

https://dailytimes.com/news/article_76d3f886-3def-11e4-8961-c733c636b59f.html

Saying it a different way - Mooney could remove all the machines and fixtures from the Factory and move somewhere else but they would still be paying the Lease for the empty Factory facility.  That outcome is most likely worthless.

Edited September 14, 2024 by 1980Mooney

[Marc_B]

@1980Mooney I was meaning the extensive equipment and production capability when referring to the “factory”. No clue the cost to replicate all the equipment that we saw there…a lot. But you’re right, that it’s probably equally liability as manufacturing moved from metal work to composites and plastics. But the sum total of aircraft out there with needs that “could” be filled with Kerrville manufacturing is still pretty good.

But the inspiring aspect of the tour and speaking with the people still there is that the M20 series still remains one of the most efficient and aerodynamic 4-seat single engine aircraft available even today. 

[WilliamR]

On 9/14/2024 at 8:04 AM, Pinecone said:

Jonny Pollack video called into the banquet.

He said he thinks there are near a deal with some investors for a large cash infusion. 

Without any insider info, $1,000 says Arcline is in the mix. Those guys have been on a good buying spree. Plus, I'm sure it adds some vertical integration to their diverse portfolio. Most Mooney owners wouldn't like that, though.