Lasar Aviation Mooney Assurance Program - Really?

[toto]

I think this was mentioned earlier in the thread, but does anyone know how the Assurance program would affect the MSC network?  I'd prefer more, not fewer, MSCs, and the Assurance parts priority thing is a little bit hard for me to get my head around.  When I'm placing an order for a factory part but the order is submitted from my mx shop, I assume that Mooney has no idea who the ultimate buyer is.

[Echo]

14 minutes ago, Pinecone said:

As I understand it, they are buying all of Mooney.  They need to keep the Mooney name and location to keep the legal ability to make the parts under the existing approvals.

Ahhhhh.  O.K. NOW I better understand.  Mooney is broke and Lasar as well as being cash challenged does not want/can't go through part approval process so needs owners to pony up cash to allow that to happen or Mooney goes bankrupt and existing owners lose equity and the liklihood of someone coming in buying Mooney and jacking up prices (more than current out of this world price) will happen...OR an existing specialist in aviation parts buys Mooney and organizes as a PARTS supplier vs. trying to build and sell airplanes under current type certificate (that is unprofitable) as shown by bankruptcy after bankruptcy.

[GeeBee]

2 hours ago, Echo said:

Ahhhhh.  O.K. NOW I better understand.  Mooney is broke and Lasar as well as being cash challenged does not want/can't go through part approval process so needs owners to pony up cash to allow that to happen or Mooney goes bankrupt and existing owners lose equity and the liklihood of someone coming in buying Mooney and jacking up prices (more than current out of this world price) will happen...OR an existing specialist in aviation parts buys Mooney and organizes as a PARTS supplier vs. trying to build and sell airplanes under current type certificate (that is unprofitable) as shown by bankruptcy after bankruptcy.

Nothing prevents the existing owners from selling Mooney to LASAR for $1.00 if they want to avoid bankruptcy court.

[GeeBee]

3 hours ago, Brandt said:

Your point?

In finance, words and terms are important. It avoids misunderstandings, disappointments, lawsuits and the tax audits.

[Tom F]

2 minutes ago, GeeBee said:

Nothing prevents the existing owners from selling Mooney to LASAR for $1.00 if they want to avoid bankruptcy court.

Nothing, except it’s not for sale for a $1.00.  Business go out of business everyday without filing bankruptcy. You’ve made an assumption without any knowledge of the actual facts.

[Aerodon]

Companies like Univair and McFarlane are much better setup to look after type certifies, PMA etc. and support owners.

[Tom F]

1 minute ago, Aerodon said:

Companies like Univair and McFarlane are much better setup to look after type certifies, PMA etc. and support owners.

You may very well be correct.  Unfortunately that’s not where we find ourselves today.

[Tom F]

2 hours ago, Echo said:

Ahhhhh.  O.K. NOW I better understand.  Mooney is broke and Lasar as well as being cash challenged does not want/can't go through part approval process so needs owners to pony up cash to allow that to happen or Mooney goes bankrupt and existing owners lose equity and the liklihood of someone coming in buying Mooney and jacking up prices (more than current out of this world price) will happen...OR an existing specialist in aviation parts buys Mooney and organizes as a PARTS supplier vs. trying to build and sell airplanes under current type certificate (that is unprofitable) as shown by bankruptcy after bankruptcy.

I would assume you may be correct on Mooney being broke.  Please provide some information to back your claim of Lasar’s financial condition.  I’ll monitor and wait for factual information to back your claim. 

[Tom F]

2 hours ago, Pinecone said:

As I understand it, they are buying all of Mooney.  They need to keep the Mooney name and location to keep the legal ability to make the parts under the existing approvals.

While I do not have firsthand knowledge of the agreement between Lasar and Mooney, I believe you are correct with regard to the name and the PC, TC, PMA’s STC’s etc.

[Tom F]

2 hours ago, Paul Thomas said:

Own all of Mooney or part of Mooney?

It's hard to understand how the membership program will work. It seems if you're AOG, you could just pay the membership to jump ahead of the line of the non-members and cancel. You may as well call it a rush fee.

That assumes they have successfully purchased Mooney.  Not what I’d call the spirit of the deal however.  I’m sure the Lasar guys will take your shortcut into consideration. Good luck with that.

[GeeBee]

1 hour ago, Tom F said:

Nothing, except it’s not for sale for a $1.00.  Business go out of business everyday without filing bankruptcy. You’ve made an assumption without any knowledge of the actual facts.

I was providing a suggestion made by our friend WilliamR who is an investment banker. If you want to avoid the uncertainty of bankruptcy and insure the continuity of the existing company and the success of the new owners, it is one strategy.

[Schllc]

The Aerostar factory makes this work with a fleet of about 600 planes. 
Point being it’s possible to make this work. 
Given there are so many variants of the m20, there will have to be some hard decisions.  
It just isn’t feasible to make every single part that the diversity of the fleet requires. 
As I have said before, they have records of everything they have sold, and it doesn’t seem like an insurmountable challenge to analyzes this and figure out what is needed and profitable. 

[Fly Boomer]

4 hours ago, Pinecone said:

As I understand it, they are buying all of Mooney.  They need to keep the Mooney name and location to keep the legal ability to make the parts under the existing approvals.

I'm glad they got educated on that issue when they moved away from California.

[Fly Boomer]

2 hours ago, Aerodon said:

Companies like Univair and McFarlane are much better setup to look after type certifies, PMA etc. and support owners.

McFarlane looked at Mooney, but couldn't make it work.

[laytonl]

I don’t think their plan is going to play out well.  Lee

[LANCECASPER]

5 hours ago, Schllc said:

The Aerostar factory makes this work with a fleet of about 600 planes. 
Point being it’s possible to make this work. 
Given there are so many variants of the m20, there will have to be some hard decisions.  
It just isn’t feasible to make every single part that the diversity of the fleet requires. 
As I have said before, they have records of everything they have sold, and it doesn’t seem like an insurmountable challenge to analyzes this and figure out what is needed and profitable. 

For years in manufacturing when a company was well-capitalized they produced parts that had a high-turn rate and sold them to their dealers to stock, taking the burden off of the manufacturer to carry 100% of the inventory and spreading that inventory through the dealer network. To be a dealer, or in this case an MSC, you had to stock parts.

Once the machines in Kerrville are set up to produce a certain part number you can get some economy of scale by producing enough of that part to get your cost per unit down. Then if they could load up the supply chain to the dealers that would help take care of cash flow to keep the overhead paid. In my opinion, the MSCs should be the ones investing in Mooney. If they believe in the future of this, as an example, if 10 of the bigger MSCs put in $10,000-$15,000 each to get the ball rolling,  to me that would make a lot more sense than individual owners who don't even need a part at the moment putting money on deposit. Smaller MSCs could put in a lesser amount but wouldn't get as favorable of a price structure. It wouldn't kill an MSC to keep some often-sold parts in stock. As @Schllc mentioned, start with the most often requested part and go down the list and build up the supply chain and sell it off to the dealers to stock. The risk for the investment goes down to nothing once the MSC has the parts they've paid for in stock. 

Mooney isn't alone in the supply chain being broken. Every shop now servicing any make, is used to ordering every part that they need once they know they need it. By not stocking parts dealers pay an atrocious price per part, and pass that and the shipping cost on each part on to the consumer, all contributing to make General Aviation very expensive for the average person, all while the airplane sits there waiting on parts clogging up the maintenance chain.

[Echo]

4 hours ago, GeeBee said:

I was providing a suggestion made by our friend WilliamR who is an investment banker. If you want to avoid the uncertainty of bankruptcy and insure the continuity of the existing company and the success of the new owners, it is one strategy.

My "hot take" is that continuity isn't high on the old owners list?  They want SOMETHING out of their investment instead of handing over to Lasar.  I get that, but I think funding the "deal" with customers cash is a slimy move...and if they were NOT "cash poor"  they wouldn't have to do it, but since it is a "backroom deal" that is transparent as an old line rats plexy I don't know.  Makes me O.K. that t-shirt is worn out...although that was "the old" Lasar.

[Echo]

Maybe the Lasar cartel wants the whole slice of the pie.  You. the plane owner deals direct with Laser.  Cut out that pesky Mooney Service Center from getting a little taste.

[Schllc]

48 minutes ago, LANCECASPER said:

Mooney isn't alone in the supply chain being broken

I don’t understand how they cannot forecast what would be needed in any given year. 
Queries and quotes should be tracked as well.  
Some of those would likely sell if available, and at any cost.

they already have this information, does this mean there is no viable way to provide the demand?  Referring mostly to internally manufactured but should also apply to anything that fits within the demand such as minimum order size  

it sounds like for the majority of tracked part numbers just aren’t needed very frequently.

I would bet less than 2% of unique part numbers constitute 80% of demand.  They should partner with a shop to occupy a big chunk of the factory.  
Maybe make it a fly in destination with little factory historical your, maybe a restaurant. 
I think this would lower overhead a big convenience and draw. 
I enjoyed my experience in the factory the three times I was there. 

[LANCECASPER]

24 minutes ago, Schllc said:

I don’t understand how they cannot forecast what would be needed in any given year. 
Queries and quotes should be tracked as well.  
Some of those would likely sell if available, and at any cost.

they already have this information, does this mean there is no viable way to provide the demand?  Referring mostly to internally manufactured but should also apply to anything that fits within the demand such as minimum order size  

it sounds like for the majority of tracked part numbers just aren’t needed very frequently.

I would bet less than 2% of unique part numbers constitute 80% of demand.  They should partner with a shop to occupy a big chunk of the factory.  
Maybe make it a fly in destination with little factory historical your, maybe a restaurant. 
I think this would lower overhead a big convenience and draw. 
I enjoyed my experience in the factory the three times I was there. 

Even get permission from the county to rent out some hangar space in those cavernous Mooney buildings. There is a waiting list at the airport and the whole area has a shortage of hangars. In the final assembly area that isn't being used now you could hangar 25 airplanes at least at $400 per month ($10,000). And there are 2 or 3 more areas of that size that could probably also be used.

[Aaviationist]

20 hours ago, hazek said:

This is factually incorrect. We know for a fact:

• the factory is operational
• the factory is not producing any aircraft
• the factory has difficulty producing parts ranging from not being able to at all to it takes a very long time

That is not "zero actual information". One can make some pretty good assumptions based on this information already.

This is contradictory. How can an aircraft manufacturing company, which doesn’t make airplanes, and doesn’t have the ability to make parts be “operational “. 
 

sounds like the definition of Non-operational 

[Justin Schmidt]

2 hours ago, LANCECASPER said:

For years in manufacturing when a company was well-capitalized they produced parts that had a high-turn rate and sold them to their dealers to stock, taking the burden off of the manufacturer to carry 100% of the inventory and spreading that inventory through the dealer network. To be a dealer, or in this case an MSC, you had to stock parts.

Everyone knows that doesn't work. We have lean/lean six sigma, JIT processes in which are proven around the world whether in a niche area or mass production.  Matter of fact, niche areas benefit the most. Unfortunately,  when we went to lean in the 80s everything got much better,  and like idiot management went right back to old processes,  at least in America. 

Current owners of Mooney had no intention of saving the company,  they wanted a pump and dump and make some money. This is what firms like that do, invest,  turn quick, sell quick or do things with the IP, see it daily in the tech world. Think of mitt Romney,  but he/his firm was actually good at it.

Johnny had no idea what he was doing,  no knowledge of manufacturing,  business,  or how to make a niche area profitable.  He just thought he could talk it up make something look good on paper and sell. Well that didn't work out. That really has been the curse of Mooney company.

The only way a company of manufacturing parts can be profitable is learn lean, know the industry,  know business, know the audience meaning price points and what's needed.

It is never good storing parts. Really someone needs to crawl to Daher.

[Schllc]

11 hours ago, Aaviationist said:

This is contradictory. How can an aircraft manufacturing company, which doesn’t make airplanes, and doesn’t have the ability to make parts be “operational “. 
 

sounds like the definition of Non-operational 

I took operational to mean within regulatory confines, it is operational.  
a manufacturing certificate is neither easy or cheap to obtain. 
from a profitability perspective, it is obviously not functioning properly. 

[Pinecone]

Comments I have heard indicate that Mooney did not have the cash to buy the raw materials to produce parts.

[Yetti]

Mooney is probably kind of one of those standard "Management Teams"  where they want their salary which is usually pretty steep, but don't really know how to do real work.    The Factory could probably work if there were some get your hands dirty management team that knew how to do real work. 

An Owner buyout ie crowdsource of the factory, with actual shares in the factory, would be better than this current Owner Assurance plan proposal which looks to be a give us some cash and you might get something in the future plan.