Van’s Aircraft Facing Challenges

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Ed Haywood said:
That will be determined by the terms of the agreements Vans and the vendor signed. Unless the vendor wants to avoid the negative reputational impact of failing to satisfy a customer, enforcing those agreements will probably require legal action. The mediation and litigation process can take several years, so it is unlikely to save Vans in the short run, and will cost them $ before it saves them $$. If the vendor does not have fairly deep pockets, prevailing could put them out of business too, and now the whole mess is bogged down in two BK's.
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If Vans inspected and accepted the parts, it could be SOL even if the vendor didn't do exactly what it said it would, unless the "flaws" weren't detectible. And Vans would also likely have to show some harm from the change, which would be difficult if its position is that the parts are fine but it's replacing them for customer satisfaction. Of course all this does depend on the terms of the agreement, the factual details, and a bunch of legal issues.
 
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TCABM said:
There seems to be a fundamental misunderstanding of what the word “brand” means.
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Fair; 5 supermassive beer conglomerates and whatever local breweries have on offering.
 
DavidWhite said:
Fair; 5 supermassive beer conglomerates and whatever local breweries have on offering.
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If by "local" you mean continental, sure. There are dozens if not hundreds of beers that are available across the U.S. not on that chart.

My grocery store has dozens of options in the beer isle, many of which I can get in a grocery store 1,000 miles away from here.
 
TCABM said:
There seems to be a fundamental misunderstanding of what the word “brand” means.
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And a fundamental misunderstanding of “competition.” Even inside a conglomerate, brands compete and the conglomerate will allocate or remove resources and sell or acquire brands depending upon competitive performance.

Do the Steelers not compete with the Patriots although both are part of the NFL?
 
Salty said:
Funny. Not one of the beers I've had in the last 5 years is on that chart. Guess there's more choices than it wants you to believe. Do those guys sell a lot of beer? Absolutely. But there are more choices outside that list than inside.
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The beer conglomerate chart is amusingly appropriate and parallel to the conversation about Vans. I also seem to be more on the microbrew list, although I've settled for a few of those beers recently.

"You only have 5 choices in general aviation, and most of them are Textron InBev" :D
 
Half Fast said:
And a fundamental misunderstanding of “competition.” Even inside a conglomerate, brands compete and the conglomerate will allocate or remove resources and sell or acquire brands depending upon competitive performance.

Do the Steelers not compete with the Patriots although both are part of the NFL?
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Sure, I guess my point is that if you want to avoid a certain conglomerate it isn’t always particularly easy to do. Take sunglasses/glasses for example and look at Luxxotica.

The second part of your post isn’t quite a good comparison IMO, while the Patriots and Steelers are both part of the NFL, they are not owned by the same entity.
 
DavidWhite said:
Sure, I guess my point is that if you want to avoid a certain conglomerate it isn’t always particularly easy to do.
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Often it is. But “particularly easy” isn’t a criterion for a free market.

And different conglomerates operate in different ways. Some are merely holding companies that don’t directly manage their brands, leaving them free to compete inside and outside the conglomerate.

The economy is actually much freer than you realize.
 
Half Fast said:
And a fundamental misunderstanding of “competition.” Even inside a conglomerate, brands compete and the conglomerate will allocate or remove resources and sell or acquire brands depending upon competitive performance.

Do the Steelers not compete with the Patriots although both are part of the NFL?
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I'm some ways, yes. In many ways (other than on the field) no. They even directly share some revenue. In the most important ways referring to markets, probably not. Certainly not in the same way they compete with XFL teams.
 
oooohhh Kaa....now back to Vans

You would think with their market if anyone sees a viable business, they will either get the help they need, or someone will scoop them up at the sale... Could be the market will shrink if the amount of price correction needed is too great.
 
DavidWhite said:
Sure, I guess my point is that if you want to avoid a certain conglomerate it isn’t always particularly easy to do. Take sunglasses/glasses for example and look at Luxxotica…
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While true, that does not mean there is limited or no competition. Take EssilorLuxottica and Safilo, in your example. Luxottica brands hold ~60% market share in the US, owning about a dozen brands and about another dozen licensed brands owned by other companies.

Safilo holds about 6% market share across about 2 1/2 dozen more brands.

34%, or 1 in 3 brands are neither Luxottica nor Safilo.
 
TCABM said:
While true, that does not mean there is limited or no competition. Take EssilorLuxottica and Safilo, in your example. Luxottica brands hold ~60% market share in the US, owning about a dozen brands and about another dozen licensed brands owned by other companies.

Safilo holds about 6% market share across about 2 1/2 dozen more brands.

34%, or 1 in 3 brands are neither Luxottica nor Safilo.
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How many of these 34% are Amazon chinesium nonsense brand names?

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TCABM said:
While true, that does not mean there is limited or no competition. Take EssilorLuxottica and Safilo, in your example. Luxottica brands hold ~60% market share in the US, owning about a dozen brands and about another dozen licensed brands owned by other companies.

Safilo holds about 6% market share across about 2 1/2 dozen more brands.

34%, or 1 in 3 brands are neither Luxottica nor Safilo.
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I was a big Maui Jim fan until they were acquired by Kering. Now I just have my old Maui Jims and all future sunglasses purchases will be from Flying Eyes.

Now I just need to convince Flying Eyes to start making Ski goggles.
 
DavidWhite said:
Yes, you get to choose between 5 brands of beer.
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If you're arguing that gigantic corporations control everything, it would be a challenge to find a worse example than beer.
DavidWhite said:
Sure, I guess my point is that if you want to avoid a certain conglomerate it isn’t always particularly easy to do. Take sunglasses/glasses for example and look at Luxxotica.
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I'm struggling to see how this becomes an issue, or an illustration of really anything. OK, Luxottica owns a lot of eyewear brands. There are dozens of others, like

Randolph
Carrera
Enemy
Warby Parker
Tomahawk
Sungod
Zenni
and on and on...

It's really, really tough to find a case that actually demonstrates the idea that a few huge corporations control everything. In the US, at least, it's simply not true.

Murph said:
oooohhh Kaa....now back to Vans

You would think with their market if anyone sees a viable business, they will either get the help they need, or someone will scoop them up at the sale... Could be the market will shrink if the amount of price correction needed is too great.
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I think there is definitely a viable business there, as evidenced by the fact that they've been around for 50 years now and can sell kits faster than they can produce and ship them. Sure, there will be corrections needed. Money will have to be borrowed, prices will have to be adjusted (there's that free/competitive market thing again), and their internal processes and staff will have to be adjusted. I doubt the more gloom-and-doom predictions of a sale to the Chinese will come to pass, but we'll all find out in the next several months I guess.

I don't really have a dog in the fight any more. I am part owner of an RV-12 E-LSA, and spent a few years hammering away at an RV-7 a while back (I was owner #2; owner #3 finished and is flying it now). My current construction project is all wood and plans built. I'm not one of those who thinks Van's is the end-all be-all of aviation, but it's hard to argue with over 11,000 airplanes completed and a few thousand more being built. Van's has consistently succeeded where many, many others have failed over the years.
 
DaleB said:
I don't really have a dog in the fight any more. I am part owner of an RV-12 E-LSA, and spent a few years hammering away at an RV-7 a while back (I was owner #2; owner #3 finished and is flying it now). My current construction project is all wood and plans built. I'm not one of those who thinks Van's is the end-all be-all of aviation, but it's hard to argue with over 11,000 airplanes completed and a few thousand more being built. Van's has consistently succeeded where many, many others have failed over the years.
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I don’t think it’s that much of a stretch to say that Vans has done more for General Aviation over the last 30 years than any other single entity.
 
Vans and other companies with long sale/production lead times get the royal vaseline treatment from inflation. A textbook case, if it's ever taught anymore to our yutes, is that dumping massive amounts of "helicopter money" into an economy can wreck big and small businesses with long business cycles and make everything worse (an economic statement NOT a political one).

There is only marginal control of CGS variables over long production-cycle business models; kind of like flying cross country in a Cub re:weather. The one saving grace is Vans are good aircraft and there is definitely a market for them at various price floors going forward. IMHO, no line of a product should be cut if it produces a positive net margin and selection variety can enhace a brand's appeal. Best hope for everyone at Vans and their customers.
 
Wow, this thread went astray.

Price fixing gets easier with a few large competitors.

IBTL = I Beat The Lock
 
Nah, this thread has jumped the shark, I think the free market moon bat - ery started it. Too bad. Still a few good insightful posts about vans though. Maybe the mods could pull the crap out and put it into another thread, but probably too out of scope for this forum.
 
PaulS said:
Nah, this thread has jumped the shark, I think the free market moon bat - ery started it. Too bad. Still a few good insightful posts about vans though. Maybe the mods could pull the crap out and put it into another thread, but probably too out of scope for this forum.
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It really chaps my arse that we can't have a civil discussion here or twenty other forums where I participate without someone jumping in and turning it into a nutter-fest.
 
DaleB said:
I think there is definitely a viable business there, as evidenced by the fact that they've been around for 50 years
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I hope you are right but old Companys disappear pretty regularly. "Past performance is no guarantee of future returns "
 
kyleb said:
It really chaps my arse that we can't have a civil discussion here or twenty other forums where I participate without someone jumping in and turning it into a nutter-fest.
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You mean Van's isn't in trouble because of Walmart? :) And I joke about that as someone that hates Walmart AND large corporations in general.

So trying to steer this back to airplanes, what about Van's going open source?

Or taking it to another level, what about an open source certified aircraft? No idea if it's ever been done before, but probably proposed.

The advantage being that the customer doesn't risk being locked into the survival of the manufacturer, assuming they or someone else can build the parts. No idea at all if it's possible for certified, given the complexity of the regs.
 
Albany Tom said:
So trying to steer this back to airplanes, what about Van's going open source?
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Let's assume (worst case) Vans as we know it goes bankrupt. Closes the doors, sells the assets (tools, designs, remaining inventory) and refunds pennies on the dollar to kit owners and others (tool suppliers, parts suppliers, banks, etc.).

Whoever buys the plans, tools, etc. can restart the business under a different name. "Albany Tom's Aircraft" and begin selling kits and replacement parts. There's profit to be made doing that, given a slightly different business approach (more QC, more contractual mitigation of issues, selling prices indexed with inflation, etc.)

Ain't no money to be made by going open source and releasing the plans to the public, so I don't see that happening. Albany Tom's aircraft didn't buy those plans and design rights to give 'em away...
 
Albany Tom said:
assuming they or someone else can build the parts. No idea at all if it's possible for certified, given the complexity of the regs.
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E-AB - you can pretty much build whatever the heck you want as long as the "major portion [...] has been fabricated and assembled by persons who undertook the construction project solely for their own education or recreation." (21.191 g)

If you wanted to clone a Vans design - the issue would be a civil one over whatever intellectual property Vans may hold. But as an example, the first Kitfox was an almost exact copy of the Avid Flyer (Dan Denney (kitfox) had worked for Dean Wilson (Avid Flyer)). Wilson took Denney to court, but Denney prevailed. But it's possible that Vans may have better IP protection than Wilson had.
 
I agree that open source is a wild business model, and that it usually only applies to software, but Prusa did it with 3D printers and became one of the market leaders. Their model was to make money selling printers, but by having the design open there was little or no hesitation to buy into the platform. They have competitors, but people are willing to pay a premium for Prusa built Prusa. My take is that their going open source, combined with a good product, gave them a growth rate that exceeded anyone else in that space, for multiple years.

That concept isn't completely unheard of, in different forms in different areas. 1911 and AR platforms are just about effectively open source, and multiple companies are making a profit on them, and the original holders of the name, Colt, Armalite, could demand a premium price. Even IBM more or less let the original PC AT become a defacto open source until PS/2, and it absolutely helped that platform gain dominance. The locked down PS/2 platform, by comparison, was a bit of catastrophe.

Now all of that said...my examples have been in areas where number of units sold are many orders of magnitude higher than with airplanes. But, if Van's stays Van's, them publishing their designs might make new customers more likely to buy into the platform. Because for good or bad, people probably aren't going to trust that they can buy a plane piece by piece anymore from Van's, or maybe from anyone. Even if they stay up and solvent, I think they will need to change their business model. Maybe that will mean just selling complete kits when they're ready to ship. That sounds expensive.
 
DaleB said:
I've seen that image posted a number of times in various places; I have yet to see the point of it. What exactly is the point?
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The point is that fewer and fewer people know how to read, hence cartoons or graphics or video instructions are required.
 
kyleb said:
It really chaps my arse that we can't have a civil discussion here or twenty other forums where I participate without someone jumping in and turning it into a nutter-fest.
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Surely you recognize that one person's nutter fest is another person's interesting discourse and vice-versa?
 
kyleb said:
Let's assume (worst case) Vans as we know it goes bankrupt. Closes the doors, sells the assets (tools, designs, remaining inventory) and refunds pennies on the dollar to kit owners and others (tool suppliers, parts suppliers, banks, etc.).

Whoever buys the plans, tools, etc. can restart the business under a different name. "Albany Tom's Aircraft" and begin selling kits and replacement parts. There's profit to be made doing that, given a slightly different business approach (more QC, more contractual mitigation of issues, selling prices indexed with inflation, etc.)

Ain't no money to be made by going open source and releasing the plans to the public, so I don't see that happening. Albany Tom's aircraft didn't buy those plans and design rights to give 'em away...
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If Vans files a bankruptcy, I'd expect it to be a reorganization rather than a liquidation. It's a going concern with a viable business model that it did a poor job of executing, but it seems to me that the company is still worth more than the value of its hard assets. But that's just a guess and this isn't my area of expertise.
 
kyleb said:
It really chaps my arse that we can't have a civil discussion here or twenty other forums where I participate without someone jumping in and turning it into a nutter-fest.
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Better a nutter-fest than a nutscape!
 
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