John Frank's September 2013 Cessna Pilot's Assn Article

denverpilot

denverpilot

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John's Article: "Legacy Maintainability" in the Sept 2013 CPA magazine is an eye-popper on the insider changes at Cessna as Textron and former GE execs took over and the resulting long-term effects on Cessna parts prices.

In summary, Cessna isn't run by airplane enthusiasts willing to make parts at cost or even below cost anymore for "Legacy" aircraft to keep prices low for new pilots in the Legacy fleet, and parts prices are skyrocketing. Many parts will simply become unobtainable if no one wants to make them in low quantity for Cessna as they outsource most parts manufacturing on older parts.

He gives an example of the R/TR-182 landing gear pivot assembly. The original pivot assembly was prone to cracking and the current part, redesigned and released in 1989, listed for $1674 in 1990. A decade later, $2400. Today, $17,640.

Battery contractor for a 1961 C-210A is $696 from Cessna. Identical non-Certified part from Spruce, $24.85.

As he puts it, paraphrased... You're buying parts now for what they cost to build for the modern version of the airplane which sells for over half a million dollars.

Well worth the read of the full article if you're a Legacy Cessna owner.

Bonus: Mike Busch describing his C-310 breaking down at virtually every airport on his multi-city long XC for summer business is a chuckle too. Or not, considering most of us aren't mechanics and we'd not have had the options he did.

Fleet is getting old. :(
 
I don't think I've ever purchased a Cessna part they sold at a loss.
 
He claims previous management didn't count engineering costs or other overhead into the list pricing scheme, calling it just a part of doing business. They were losing money on the parts.

The $17000 gear part supposedly more accurately represents the true cost plus profit of that part.

His opinion. Not mine. Just passing it along.
 
Probably true. It sounds to me like a "we don't want to stock this part anymore" price.
 
I don't believe most of the airplane manufacturers ever intended on the fleet lasting 40 to 50+ years. To maintain parts support for an old aging fleet is expensive and stocking parts for extended periods is costly.

Think about it, can you go down to the Ford dealer and get a part for your 1960 Fairlane? Maybe, maybe not, but I doubt they are stocking. May have to wait while they order it and a good chance it comes from a specialty place that does reproduction parts.

I'm sure Cessna/Piper/Beech/Mooney/etc doesn't make any huge profits selling parts for out of production aircraft.
 
RotorAndWing said:
I don't believe most of the airplane manufacturers ever intended on the fleet lasting 40 to 50+ years. To maintain parts support for an old aging fleet is expensive and stocking parts for extended periods is costly.

Think about it, can you go down to the Ford dealer and get a part for your 1960 Fairlane? Maybe, maybe not, but I doubt they are stocking. May have to wait while they order it and a good chance it comes from a specialty place that does reproduction parts.

I'm sure Cessna/Piper/Beech/Mooney/etc doesn't make any huge profits selling parts for out of production aircraft.
Click to expand...

If planes changed as much as cars, that'd be a valid point. But, planes are not cars and many of the Cessnas/Pipers/Beechs have 70%+ commonality/interchangeability over 30+ year production runs, including the new builds. At a certain point, the R&D has been paid for and the prices for more common and/or cross-platform parts is just gouging and $ for dealing with the archaic FAA paperwork.
 
warthog1984 said:
If planes changed as much as cars, that'd be a valid point. But, planes are not cars and many of the Cessnas/Pipers/Beechs have 70%+ commonality/interchangeability over 30+ year production runs, including the new builds. At a certain point, the R&D has been paid for and the prices for more common and/or cross-platform parts is just gouging and $ for dealing with the archaic FAA paperwork.
Click to expand...

A huge number of these planes have been out of production for 20+ years. The paperwork is not that big of a deal for the manufacturers. It's purely economics. If you ran a business would you sink capital into producing parts that may not sell for years, or ever, just to satisfy a product you stopped producing over 20 years ago?
 
I've been amazed that Cessna has supported the fleet for such a long period of time, and attributed it to the same factors mentioned in the article.

I work extensivelyy with a twin-cessn/King Air/Citation shop that requires an amazing amount of parts on a weekly basis, many for planes built in the 70's and 80's. Having personally worked several hundred million of financing with GE, I know first-hand how they work and have yet to see any indication of nostalgia and loyalty to old customers. I agree that it's going to get ugly and may pull the plug for that very reason.
 
R&W may have hit another truth. These ARE 1960s automotive parts in many cases. ;)
 
It ain't limited to Cessna. The "wizards" in charge of Textron are destroying just about every business they are in. Management by spreadsheet and reactionary share price actions. They're eating their own seed corn and have turned a deaf ear to their customers be they the GA aircraft owner or the head of the largest federal agency.
 
Aviation is only one of the ways that textron makes money,as a large conglomerate profit is the bottom line.the customer is now just an afterthought.As long as you want new their there to help.
 
Clip4 said:
I don't think I've ever purchased a Cessna part they sold at a loss.
Click to expand...

If you believe their parts are expensive, try buying a blue print or drawing from them.
 
Cessna is not the only one who's older parts are getting scarce.Try getting parts for an older Beechcraft.
 
frfly172 said:
Cessna is not the only one who's older parts are getting scarce.Try getting parts for an older Beechcraft.
Click to expand...

It is industry wide, 1 gallon of silver 1quart of metallic green paint and the hardener for them is over $400 plus tax and has-mat shipping.

1 gallon of fabric cement thinner is over $80.
1 qt of fabric cement is $55.

2 mags and a harness kit was 3k

do you have any idea what is killing this industry?

what's the income of a 17-19 year old kid trying to learn to fly?

figure it out and you'll know.
 
Tom-D said:
It is industry wide, 1 gallon of silver 1quart of metallic green paint and the hardener for them is over $400 plus tax and has-mat shipping.

1 gallon of fabric cement thinner is over $80.
1 qt of fabric cement is $55.

2 mags and a harness kit was 3k

do you have any idea what is killing this industry?

what's the income of a 17-19 year old kid trying to learn to fly?

figure it out and you'll know.
Click to expand...

This!

Everything is expensive these days, we all need to get a grip on this new reality. For example copper is up 600% since 2003. 10 years a 600% increase! Think about this when looking at the cost of certain aircraft parts.

Side note: I might need to start looking at Copper as an investment.
 
Old farm machinery - my tractors were built in the 60's and 70's - are starting to get hard to get parts for in some cases. Prices are going up. More and more parts are coming out of the junk yard, a few third party suppliers and cannibalization. It's life.
 
denverpilot said:
He claims previous management didn't count engineering costs or other overhead into the list pricing scheme, calling it just a part of doing business. They were losing money on the parts.

The $17000 gear part supposedly more accurately represents the true cost plus profit of that part.

His opinion. Not mine. Just passing it along.
Click to expand...

Sounds like a bit of nonsense to me. The bulk of the "engineering" cost should happen once, after which it becomes a manufacturing problem. The engineering cost on a 30 or 40 year old design should have long ago been recovered. If "overhead" adds that much cost, then they need to reduce it, but that generally isn't an area in which large companies tend to excel.

The bottom line is that they'd much rather you buy a new airplane, and ultimately their focus goes toward those who will. Producing parts to keep the legacy fleet flying doesn't produce the big payday and likely can't adequately finance the behemoth corporate organization that MBAs like to run. No one cares about the "mission" anymore, except where that mission is to make them wealthy telling other people what to do.


JKG
 
There is an answer, clumsy though it may be ...

Somebody, somewhere is going to set up a shop for parts that routinely wear out or fail. That shop, through some really clever CNC machines (think the current crop of "computer parts printers") is going to take a chunk of raw material, push a button, and turn out ALMOST a serviceable part.

I say ALMOST because if you want to buy a (for example) Cessna gear part, you can't buy it from that shop. What you CAN buy is a part that needs a little work to be a Cessna gear part. That may be as easy as turning down a shaft or drilling out a hole. But the raw part you buy will be CLEARLY and INDELIBLY marked "Not for aircraft use".

But you have to supply the person doing the finish work with a drawing as to what needs doing to finish the Cessna part. Again, you will find an engineering drafting company willing to sell you that drawing marked "For Experimental Purposes Only".

You then redraw that drawing with your own name on it, take that Not Airplane part to a machine shop (or do it yourself) and have them finish the part and machine off the "Not for ..." logo.

The original Not Airplane part is a relatively inexpensive part. The drawing is an inexpensive drawing. The machine shop is a relatively inexpensive procedure. And you have an "Owner Produced Part" that costs you a hell of a lot less than CesMooBeeiper will sell it to you.

Before you all cast stones, I suggest you read (and read CAREFULLY) the FAA Chief Legal Counsel's published opinion on FAR 21.303(b)(2). It is one of the most sensible opinions from a lawyer I've ever seen.

And who is on the legal hook when the airplane breaks (not because of this part) and injures somebody? Not Cessna. Not the "Not For .." producer, not the "Not For..." plans paperwork, not the machine shop that produced what you gave them, who? Who? That's a hell of a good legal question and one that I'm not sure any lawyer that can[t find deep pockets wants to investigate.

Comments from people who know what they are talking about welcomed.\

Jim
 
Alexb2000 said:
This!

Everything is expensive these days, we all need to get a grip on this new reality. For example copper is up 600% since 2003. 10 years a 600% increase! Think about this when looking at the cost of certain aircraft parts.

Side note: I might need to start looking at Copper as an investment.
Click to expand...

Isn't that the value of the dollar?

And don't hand me the Phoney government numbers.
 
JGoodish said:
Sounds like a bit of nonsense to me. The bulk of the "engineering" cost should happen once, after which it becomes a manufacturing problem. The engineering cost on a 30 or 40 year old design should have long ago been recovered. If "overhead" adds that much cost, then they need to reduce it, but that generally isn't an area in which large companies tend to excel.

The bottom line is that they'd much rather you buy a new airplane, and ultimately their focus goes toward those who will. Producing parts to keep the legacy fleet flying doesn't produce the big payday and likely can't adequately finance the behemoth corporate organization that MBAs like to run. No one cares about the "mission" anymore, except where that mission is to make them wealthy telling other people what to do.


JKG
Click to expand...

It's about share price and cutting cost any way possible. Textron is not alone.

Look at what IBM has done to meet their "Roadmap 2015" to increase earnings. Jettison retiree healthcare to make them buy on a new exchange. Make 401K matching contributions at the end of the year so anyone leaving - or fired - mid year gets no match, and others lose earnings on that money. Obsolete certain products.

Computer makers obseleting old OS and hardware (try to get new parts for an old embedded computer).

Heck, look at the uproar over Foreflight and the Apple 1.

It's about a throwaway society that finds it more important to replace the entire airplane rather than making parts to keep it going. Yes, it may kill the industry as it becomes too expensive. But we're headed in that direction for some time as it is.
 
Tom-D said:
Isn't that the value of the dollar?

And don't hand me the Phoney government numbers.
Click to expand...

Sure the dollar is being devalued, no argument. Also the demand for raw materials is going through the roof, so two things.

Our lifestyle is coming down, the rest of the world's is going up, water finding its own level. That's what happens in a world wide economy.

I say quit bitching about $5 Avgas and fly the wings off em'. 10 years from now we might easily be looking at $10 or $15.
 
wsuffa said:
It's about share price and cutting cost any way possible. Textron is not alone.

Look at what IBM has done to meet their "Roadmap 2015" to increase earnings. Jettison retiree healthcare to make them buy on a new exchange. Make 401K matching contributions at the end of the year so anyone leaving - or fired - mid year gets no match, and others lose earnings on that money. Obsolete certain products.

Computer makers obseleting old OS and hardware (try to get new parts for an old embedded computer).

Heck, look at the uproar over Foreflight and the Apple 1.

It's about a throwaway society that finds it more important to replace the entire airplane rather than making parts to keep it going. Yes, it may kill the industry as it becomes too expensive. But we're headed in that direction for some time as it is.
Click to expand...

I agree. My point is that the excuses for why it isn't being done are just that--excuses. Sure, for some things, legislation or regulation naturally influences behavior (usually negatively), but strategy with regard to product and serving the market is most often a choice. To some degree, the problem is inherent in computer technology, but I'm not sure that the same can be said for aviation.


JKG
 
Alexb2000 said:
Sure the dollar is being devalued, no argument. Also the demand for raw materials is going through the roof, so two things.

Our lifestyle is coming down, the rest of the world's is going up, water finding its own level. That's what happens in a world wide economy.

I say quit bitching about $5 Avgas and fly the wings off em'. 10 years from now we might easily be looking at $10 or $15.
Click to expand...

The globalization of the economy has far less impact on our standard of living than our own (mostly poor) policy choices here at home. You can't funnel off productivity into vast wastelands of unproductive ideological experiments, mostly through government fiat, and expect things to get better.

With that being said, you're right, it could be worse.


JKG
 
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Perhaps we should all consider this when paying $300K for a new 172. Up till recently, it was reasonable to assume you were investing in a 40-year product. If Cessna prefers we now view them as disposable, there should be some downward pressure on prices.
 
weirdjim said:
There is an answer, clumsy though it may be ...

Somebody, somewhere is going to set up a shop for parts that routinely wear out or fail. That shop, through some really clever CNC machines (think the current crop of "computer parts printers") is going to take a chunk of raw material, push a button, and turn out ALMOST a serviceable part.

I say ALMOST because if you want to buy a (for example) Cessna gear part, you can't buy it from that shop. What you CAN buy is a part that needs a little work to be a Cessna gear part. That may be as easy as turning down a shaft or drilling out a hole. But the raw part you buy will be CLEARLY and INDELIBLY marked "Not for aircraft use".

But you have to supply the person doing the finish work with a drawing as to what needs doing to finish the Cessna part. Again, you will find an engineering drafting company willing to sell you that drawing marked "For Experimental Purposes Only".

You then redraw that drawing with your own name on it, take that Not Airplane part to a machine shop (or do it yourself) and have them finish the part and machine off the "Not for ..." logo.

The original Not Airplane part is a relatively inexpensive part. The drawing is an inexpensive drawing. The machine shop is a relatively inexpensive procedure. And you have an "Owner Produced Part" that costs you a hell of a lot less than CesMooBeeiper will sell it to you.

Before you all cast stones, I suggest you read (and read CAREFULLY) the FAA Chief Legal Counsel's published opinion on FAR 21.303(b)(2). It is one of the most sensible opinions from a lawyer I've ever seen.

And who is on the legal hook when the airplane breaks (not because of this part) and injures somebody? Not Cessna. Not the "Not For .." producer, not the "Not For..." plans paperwork, not the machine shop that produced what you gave them, who? Who? That's a hell of a good legal question and one that I'm not sure any lawyer that can[t find deep pockets wants to investigate.

Comments from people who know what they are talking about welcomed.\

Jim
Click to expand...


You mean like the 80% "NOT A FIREARM" paper weights you can buy online?
 
PW_Plack said:
Perhaps we should all consider this when paying $300K for a new 172. Up till recently, it was reasonable to assume you were investing in a 40-year product. If Cessna prefers we now view them as disposable, there should be some downward pressure on prices.
Click to expand...

So when you buy a $70K + Cadillac Escalade should GM be ready to provide parts and support for the next 50 years? :dunno:
 
I think it's been mentioned in a kind of sideways argument but I'll come right out and say it. Textron/Cessna is leveraging the regulations on parts put in place to force a sole-supplier pricing model.

A brand new condor tire is under $100 because if you don't want to buy a Condor, you can buy a Goodyear, or a McCreary, or something else. If you want to buy that pinion shaft, or whatever that goes on the gear, the only people you can get it from is Cessna, or you can make it yourself.

Maybe Cessna doesn't want to support a 40 year old plane anymore, and that's a corp policy that may irritate me, but hey - they are in business to make money, not make me happy. What saddens me more is that a company uses the leverage of regulation to take financial advantage.

I would like to see the regs on owner produced parts made more clear, or allow anyone to make a part by reverse engineering. Surely I can reverse engineer some wear parts and sell them for aviation use without incurring a penalty from the feds. But no, it's murky, and I have read things and still don't really grasp the understanding of 'owner produced parts' regs fully.

It's why I went EXP for my last plane purchase. I'm hearing costs of a glass cockpit conversion for certificated around $18-40k, and I can do basically the same thing myself, maybe not a fancy but suitable for my purposes for under $6k.
 
. What saddens me more is that a company uses the leverage of regulation to take financial advantage.
Click to expand...

That's one of the purposes of regulation, and it is one reason that corporations spend money on lobbyists to tilt the regs in their favor.
 
ebetancourt said:
Most of the engineering drawings for antique Wacos are available from the Smithsonian. Just saying. :yes:
Click to expand...

And they are not free there either.

and if you need one today, forget it, plan on a 6 month wait.
 
PW_Plack said:
Perhaps we should all consider this when paying $300K for a new 172. Up till recently, it was reasonable to assume you were investing in a 40-year product. If Cessna prefers we now view them as disposable, there should be some downward pressure on prices.
Click to expand...

Nope. Frank points out the current list price of the 172SP is now over. $400K.
 
And an even better reason to be familiar with the machine-shop capabilities in your area.

wsuffa said:
That's one of the purposes of regulation, and it is one reason that corporations spend money on lobbyists to tilt the regs in their favor.
Click to expand...
 
wsuffa said:
That's one of the purposes of regulation, and it is one reason that corporations spend money on lobbyists to tilt the regs in their favor.
Click to expand...

Yes - but that doesn't make it right. It's one of the more disastrous faults of a democratic system that can be leveraged. Republicanism is the answer, but we aren't moving in that direction.
 
So, should we all sell while the selling is good? Move to experimental?

If parts double or triple in price, that hurts our sale value.

Just trying to predict the curve .... Glasair III, here I come... but it won't hydrobrake .... damnit, I like my 180 ... :mad2:
 
Make it bigger, a four seater, IO-550, and I'm in.

9346d1291147482-2011-glasair-sportsman-2-2-stormy-sportsman.jpg
 
Last 11 years of 180 ownership has cost roughly zip in Cessna-provided parts.

txflyer said:
So, should we all sell while the selling is good? Move to experimental?

If parts double or triple in price, that hurts our sale value.

Just trying to predict the curve .... Glasair III, here I come... but it won't hydrobrake .... damnit, I like my 180 ... :mad2:
Click to expand...
 
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