What does it really cost to build a plane?

SoonerAviator said:
Agreed, Henning. I just feel like they want to play the high-margin game instead of the high-volume game. I think 66% margin will eventually cause the new aircraft market (at least for trainer/GA) to disappear for all but FBO's/flight schools. The regular joe's will continue to buy 30-40yr old aircraft, and leave the $350K+ purchases to the wealthy.

As the pool of pilots dwindles, the pool of potential buyers also shrinks. If aircraft manufacturers continue to try and ask for more price as opposed to making it up on volume, they'll be making 5-aircraft per year, and trying to extract $800K out of a 172, lol.
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It's actually not that bad of a deal, because aircraft are typically low use/high durability products. My 1960 310 had 3300TT on it and with a panel upgrade was a fully capable modern aircraft with nearly new engines and brand new props for 1/15th the cost of new. Let those with a job for the plane eat the new depreciation and then sell it to the rest of us shlubs who don't have someone else paying for the plane for us. As far as resource management goes, short of a communal, global, aircraft fleet, it's pretty good. You wouldn't think about having a 40 year old car as your daily commuter and you wouldn't think twice about using a 40 year old plane as one. That's the difference in aircraft economics, the durability of the product, and a lot of that is legislated in a round about way through strict engineering and production standards.
 
bflynn said:
Would be interesting to see 2 ipads held in slots on the panel. That would make for an interesting and really inexpensive experimental flight control.

Is there a good PFD app? Foreflight or other comparable app on the other?

and of course keep current on the steam gauges, just because it's not hardened equipment.
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The only problem is, where you need it, you can't use it, and when you can use it, you don't really need it. If you are going to do IFR Glass, you are spending $17,000k even in Experimental, $20k with full access ADSB.
 
Piper, Cessna, and Cirrus must be making a killing....:yikes::yes::D
SoonerAviator said:
There is no way that a 172 should cost more than $120K in labor and materials (not including fancy G1000 panels). If their manufacturing costs are that high, then they have some serious supply chain issues and insane labor unions. It's not like Van's, or any of the newer composite aircraft that have been making alterations to tooling/designs in the first decade of production. The 172 has been produced for half a century, and several decades without any major structural alterations. Your costs go down once the manufacturing process is refined further and you become more efficient. If it takes Cessna 1,000 man-hours to produce a 172, their entire procurement/production management staff need to be terminated.
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SoonerAviator said:
They may not be high-volume, but you can't sell more volume if no one can afford your product.
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hey....news flash, that's called business. Competition is the American way. :yes:
 
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Checkout_my_Six said:
Piper, Cessna, and Cirrus must be making a killing....:yikes::yes::D
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I would bet Cirrus is just fine. Does Beech still exist, or is it fully usurped by Cessna? Will they keep the name of their namesake's early partner around?:dunno: I try to make Cessna Baron or Cessna Bonanza come out of my mouth and I trip over my tongue.:lol:
 
drotto said:
I am looking for some real numbers here, hard materials costs, and labor. Strip away the regulations, lawyers fees, liability, etc. I can buy a nice car for 25 to 35k. I can buy a great top end car for 80 to 100k. Yes, I am leaving out the supercars. What does your run of the mill 172, 182, Archer, or even sr22, cost to actually produce?
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drotto said:
Take that into considetation. I realize there is alot more hand work in a plane as opposed to cars, and demand is lower, which raises costs. That is why I mentioned cars and high end cars. I expect planes to cost more in line with a high end car plus some, but how much more? What are the real costs for Piper, Cessna, etc for production.
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It can't be simplified like that... There is more to it then raw materials mixed with labor resulting into a flyable airplane. What it costs one month to build a single 172 isn't what it's going to cost the next month, or the month after that. The financials that Textron/Cessna look at on thier monthly production,sales and forecast reports are more concerned with a margin than an individual profit on a single airplane... or line of airplane. Now if a particular product performs bad and the demand isn't there then it gets dropped... ie the Skycatcher. The simplest answer is it costs less to build the plane than they are selling them for.

You reference a G1000 and tried to correlate the sales price with the G1000 to an Ipad... not even in the same realm. Certification and development aside (Which I've read is 50% of the cost) the G1000 has a lot more pieces and technology embedded into it than your Ipad.

Similar to a certified plane it's a challenge to get the 'real costs' of a kit plane. Sure you have all the parts and materials you can order and put on a spreadsheet. What about labor... whats your time worth? What about where you're building it and the electricity you're using... Now get a giant hangar and have 10 people building different planes, different items, using different amounts of electricity and each valuing their time at a different rate and you can begin to see how it's challenging for Textron/Cessna to put a quantitative cots of a single plane on paper.
 
Checkout_my_Six said:
Piper, Cessna, and Cirrus must be making a killing....:yikes::yes::D



hey....news flash, that's called business. Competition is the American way. :yes:
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Sure it is. However, you may not be able to stay in BUSINESS when you and the competition have priced themselves out of the ever-decreasing pool of buyers. When a company like Rans/Vans can make aircraft that are consider as good or better than the 172 for half of the cost, the major manufacturer starts to lose its value.

If the FAA ever does anything with the owner-maintained category, Cessna may be in for a world of hurt, assuming they cared the least little bit about the SE-piston market at all.
 
If they made 100's of thousands of them a year, like they do cars, they would probably cost about what a car does. Airplanes have fewer parts than cars and nothing as complex as an automatic transmission. But there are few models of planes that they make more then 500 a year, so you just don't get the economies of scale. Planes have a lot more rules and regs, but cars are getting a lot of that too. Yea, about the same if they made 100,000 a year. No one really knows though. You'd have to try it and see.
 
drotto said:
Electronics are actually cheap to make. There is no way in the world that G1000 costs 20K to make. You can buy a portable AHAR, and an iPad for under $2000, that has nearly the same capabilities as modern avionics. My best bet is it costs Garmin between $1000 to $1500 to make a G1000 (but this is just looking at what general consumer electronics cost). Plus when you consider new avionics, the individual units are heavier, but now you have one unit doing what it used to take 6 or more units to do. Overall a weight savings.

I was talking to a mechanic the other day that works for a shop which has sold totaled planes for scrap metal. He claimed that your average 4 seat GA aircraft contains about 10k to 15k of scrap aluminum.
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Of course it doesn't cost $20K to make the G1000. But there's the R&D that the shareholders want back. There's the liability insurance that garmin and Cessna have to buy to protect themselves from the pilots (or more correctly, the pilots' families) that sue for big bucks when he flies his G1000 into cumulogranite, or runs out of fuel when the electricity fails and everything goes dark and he has no idea where he is, and so on. There's the fact that consumer electronics are built in the millions, while Garmin makes theirs in hundreds per year, maybe. And they have to build them to last, unlike a Sony boom box or any other throwaway device.

I have worked on old 172s and new 172s. I have had all the instruments and radios out of both steamers and G1000s, and the G1000 stuff is heavier. The PFD or MFD (same part) alone must weight 7 pounds. All the steam gauge flight instruments don't add up to 14 pounds, not nearly. The standby battery weighs a good 20 pounds. Until one works with this stuff he doesn't understand the weight comparisons. It's also one reason why the R and S models have much higher empty weights than the old airplanes. Other reasons include 23G seats and beefing up of several structural areas that had previously shown tendencies to crack. And the leather upholstery. Primer over the entire structure, in and out.

$10 to $15K for scrap in a four-seat GA airplane? Give your head a shake. Even if you got a buck a pound (unlikely), you have to have 10,000 or 15,000 pounds of it. An empty 172 shell might weigh 700 pounds at most.

Dan
 
Wonder why Piper quit making the Pacer?:goofy:....maybe they didn't sell well? or just maybe they weren't profitable enough? :yikes:
SoonerAviator said:
Sure it is. However, you may not be able to stay in BUSINESS when you and the competition have priced themselves out of the ever-decreasing pool of buyers. When a company like Rans/Vans can make aircraft that are consider as good or better than the 172 for half of the cost, the major manufacturer starts to lose its value.

If the FAA ever does anything with the owner-maintained category, Cessna may be in for a world of hurt, assuming they cared the least little bit about the SE-piston market at all.
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Henning said:
The only problem is, where you need it, you can't use it, and when you can use it, you don't really need it. If you are going to do IFR Glass, you are spending $17,000k even in Experimental, $20k with full access ADSB.
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Are we talking about certified IFR glass? Or just the actual cost of construction and parts.
 
Checkout_my_Six said:
you see how those new Cessnas are equipped? $65K for material cost for a new C-172?....never.
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I would say the $65K build cost is pretty accurate...

Remember, they're buying buying bulk, been building these things since 1956... One would hope they got the process and tooling down.

With that, add in the avionics and the extras I would venture to say the out the door cost at Whichita with a descent avionics would be between $85 to $100K.

Look at this way... A brand new 172 in 1969 was what $13K.... factor in cumlitive rate of inflation and that cost today is $84K
 
Just as a data point, my RV-10 cost me approx $164K broken down roughly as follows:
Kit: $41K
Engine: $40K (rebuilt, zero-timed IO-540)
Prop: $7K (Hartzell CS)
Avionics: $31K (Garmin G3X 2-screen EFIS, SL 30, GTN 650, GTX 23ES, audio panel, and back-up PFD)
Misc systems: $14K (computerized electrical system, 2-axis auto pilot with auto trim, 406MHz ELT, Nav lights/Strobes, landing light)
Interior: $4K (carpet, upholstery, side panels, overhead console, vents, etc.)
Exterior Paint: $8K
Tools: $4K
Firewall forward: $8.5K (2 alternators, hoses, SlickStart, boost pump, exhaust, baffles, prop governor, oil cooler, etc)
Misc stuff: $4K (oil, brake fluid, RTV, drill bits, paint, parts I screwed up, additional hardware, replacement tools, battery, ground power point, wiring (all gauges), connectors, antennas, etc.)
Insurance: $2.6K
 
Here's a thought, if you really think all these companies are pricing themselves out of the market then that means there is an opening. Go build and market your own certified aircraft and blow them all out of the water by selling it at half the price. I bet you'll do well.
 
StinkBug said:
Here's a thought, if you really think all these companies are pricing themselves out of the market then that means there is an opening. Go build and market your own certified aircraft and blow them all out of the water by selling it at half the price. I bet you'll do well.
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Well, Lance Neibauer did well enough Cessna bought him out....
 
kyleb said:
What are the amortized software development and certification costs embodied in a G1000? I bet that is close to a 5 figure sum.
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I develop avionics software for a living and the difference between certified
and non-certified software from a development cost perspective is
astronomical. The industry standard process is defined by DO-178 and the
amount of effort it takes to develop software to that standard is amazingly
high. If starting from scratch, the entire process can take several years. A
simple function with 10 lines of code has 10-20 of pages of documentation to
support it. Something complex like a G1000 could easily contain more than
half a million lines of code. The amount of testing required is quite significant
as well. The average software engineer makes over $100k/year so a team of 10
developers and 10 testers costs $2M x 1.5 (total cost to employ someone)
which is $3M/year just for salaries. Then there's test equipment etc.
A motion table capable of testing the gyros could easily cost $500K.
A company could easily spend $10M developing software for something
like a G1000 (wild-ass guess). Obviously software re-use is a big deal for a
company and they try to share as much software across platforms as
possible.

The other factor is that hardware for certified electronics is more expensive
than non-certified. The parts must withstand more stringent environmental
conditions such as temperature, vibration, humidity, etc. These types
of components are more expensive.

The bottom line is that it's mighty expensive to develop a "certified" aviation
product.

Unfortunately he FAA has made the cost of developing a certified aircraft so
expensive that very few people can afford to purchase a new aircraft.
 
Let's get it straight, it's the insurance industry that demands the standards, the government and FAA just codify and enforce them.
 
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