One Cessna Skycatcher Please, Easy on the Soy

By Robert Mark on December 10th, 2007

The most surprising aspect of Cessna’s decision to build its new model 162 Skycatcher in China is that anyone was at all surprised by the move. Now comes word that some people are SCwTower shocked, shocked enough, in fact, that they might want their deposits back.

Cessna’s Skycatcher blog recently found itself battered by a number of very unpleasant comments, some significantly loathsome enough that the company halted the posting of any fresh letters for a bit. As a side note, see Jetwhine’s “Rules of Engagement,” and you’ll notice that most blogs expect a certain amount of civility from posters.

That said, I’d encourage Jack Pelton and the Cessna board not to fret too much about the unpleasant comments they’ve seen. Take out the rude questions for certain, but continue to dialogue with customers. Initiating and maintaining a conversation is the fuel for the new social networking revolution that – like it or not – as the Honeymooners Ralph Kramden used to say is, “The wave of the future.”

The LSA Trend

Honestly though, the only people talking about not buying a C-162 because of the Chinese announcement are probably folks who either haven’t followed the evolution of light sport aircraft very closely or have some other agenda entirely.

Look at the website of Mr. LSA, Dan Johnson, and you’ll see that of the 60 or so LSA’s he’s written pilot reports on, only about 20 percent are built in the U.S.A. One marvelous little LSA I flew recently, the Remos, is built in Germany and shipped to the states in a crate for local assembly. REMOS_16 Others are built in the Czech Republic, Russia, Romania, Italy and Slovakia to name a few.

                                                           The Remos G-3

Cessna’s team in the U.S. is designing the Skycatcher and the C162 will be flight tested here in the states long before the Chinese at Shenyang Aircraft Corporation begin putting the pieces together. All of the components – engines, avionics, tires – are also, for the most part made in America which is considerably more positive for American manufacturing than many LSA manufacturers can claim.

A Dose of Reality

No doubt some of the heat Cessna is taking is the result of some bad timing. The Chinese have been the center of attention for quite a few sub-standard products in the past 12 months, everything from food additives to toys. The recalls have also focused a considerable amount of fresh attention on the outsourcing issue, especially from union members who believe those efforts are killing American industry. But there is a vast difference between unregulated, consumer goods produced outside the U.S. and an intensely regulated product like an airplane.

Cessna is not the first aircraft builder to look to China for partners. Embraer is building regional jets there right now. My guess is that a company like Cessna, backed by Textron, the same company that owns Bell Helicopters, has noticed the potential vulnerabilities of outsourcing that have wreaked havoc at Boeing and Airbus. The problem for those big guys is that they have too narrow a product line to safely spread the cost of a manufacturing problem across the company. Building the 747 almost bankrupt Boeing in the 60s in fact.

In Cessna’s case, the Skycatcher, the least expensive aircraft in the line, was designed to help drive new cost-conscious student pilots to flight schools around this country and the world and reinvigorate the thrill of flight for pilots who have found the cost of flying rising faster than their checkbook balances.

And certainly the Skycatcher plugs a hole in the Cessna line that has prevented it from offering a training machine to integrate with the Cessna Pilot Center course developed in partnership with The King Schools. Soon Cessna will offer a range of products for buyers to move up from zero time pilots to a biz jet, just like they did 20 or 30 years ago.

No secret here either, the Cessna folks are looking for fresh ways to sell more of their airplanes to what is turning out to be the most serious potential customer for any U.S. company in history – China.

Now the But …

Does anyone seriously believe, however, that the number one aircraft builder in the world would risk its international reputation by delivering a product that does not maintain the Cessna standard for quality? I give the Cessna folks way more credit than that kind of risk taking.

If so much as even one questionably constructed Skycatcher showed up in Wichita, Cessna simply would not deliver it. The reason is simple … they don’t have to.

These are smart people with considerable resources and no small amount of manufacturing expertise. That’s why they were able to pull off the first Very Light Jet (VLJ) project like the Mustang while Eclipse is still struggling for complete certification. Sorry, but it’s simply a fact of life.

Some people may not like the choice of mainland China to build the Skycatcher, but it is time to see the protests for what they are, political posturing which is simply a cost of doing business around the globe these days.

Want to help reinvigorate the U.S. flight training market? Learn to love the products that are an ever-growing portion of the aviation landscape and focus your social reform protests where they have an opportunity to do some good … at a ballot box near you next November.

Or you might try making some civil comments soon on the Skycatcher blog and build what every blogger hopes for … a conversation about the issues.

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15 Responses to “One Cessna Skycatcher Please, Easy on the Soy”

  1. Eric Says:

    Im not at all surprised Cessna will build the C162 in China. Labor costs are cheaper and the labor force is excellent. Airbus and Embraer are building airplanes in China. From a supply chain view, and thats my background, all of Cessnas vendors are also sourcing product in China. Everybody from Honeywell to Raytheon have aerospace facilities in China.

    Even if the airplane is assembled in Wichita, the parts may well come from China. This Xenophobic, and highly IGNORANT view that sourcing in China is a problem just havent studied the problem or they have another agenda.

    This is a GOOD move by Cessna and one I will likely blog about at my freightdawg.com blog.

    Eric

  2. Dave D Says:

    Mattel is a smart company, and they got burned. A whole slew of pet food companies got it too. How about the Boeing MD80 getting copied for Chinese SAC’s new 100-seat airliner.

    Considering the nock-offs, pirating and fakes coming from China these days and it won’t be long till the new and replacement parts for all products with begin failing at an alarming rate.

  3. Kevin L Says:

    I made a post to the skycatcher blog. It was not published. Just thought I would post it here.

    At the 2007 Skycatcher dealer rollout at Oshkosh last year, Jack Pelton (CEO of Cessna) announced that serial number 1 would go to his wife.

    My comment to Cessna was: I bet this one is not built in China.

  4. Jeff Says:

    Recently I watched a documentary about a Chinese company that is widely regarded as producing the finest violins in the world. Not surprisingly, the instruments were also among the lowest cost.

    The Chinese are not stupid people. Their luxury goods will be high quality, while there will be a small amount of junk (relative to the total amount of all exported goods) built and exported.

    Cessna will NOT accept an inferior product as long as their name is on it. From a quality standpoint, this entire discussion seems a bit irrelevant.

  5. Dave Bowers Says:

    I know a lot of people that bought the Skycatcher are not pleased that is being built in China! I sell the Remos LSA, and we will refund your $5000 deposit with the purchase of a new Remos! If you are having buyers remorse, drop me an email.

    Dave
    dave@igolsa.com

  6. David Says:

    I just wonder at the skycatcher design. By using the continential boat anchor, they have an 890 lb plane with a 430 lb useful load (i.e. without fuel).

    I own an Evektor sportstar which is typical of the current class of LSAs. It is powered by a rotax 912s and weighs 700 lbs. These aircraft all have useful loads of about 560-620 lbs. Performance does not seem much different. So, how is cessna going to market such a heavy plane? How can you do flight training with such a small useful load?

  7. Gregory Gordon Says:

    Good Morning Mr. Mark

    Re: Cessna 162

    Let’s look at what Jack Pelton the president and CEO of Cessna has to say about the project.

    Jack Pelton Says and I am quoting

    “SAC will be responsible for the fabrication and assembly of the SkyCatcher. Cessna will be responsible for all customer-facing elements including sales, distribution, customer service and warranty administration.”

    “we have specifically engineered it for the flight training environment.”

    “It is essential to maintaining competitiveness and extending the Cessna brand to emerging markets.”

    Now lets examine the facts, after all, they didn’t’ decide to buy the plane in China just so they could go visit the Pandas!

    1. Cessna will develop the complete plane and sales mission with a budget of two million dollars.
    2. Cessna will have ZERO invested in the project after that, they have no position on brick or mortar, their agreement is to purchase finished airplanes from SAC.
    3. Estimated 10 year sales revenue are in excess of 670 million dollars
    4. Estimated pre tax profit 10 years are to excess 350 million dollars

    I am sorry; I can’t even compute the return on the $670,000,000 is on a 2,000,000 investment.

    Cessna’s plan has little to do with the GA flight training industry in the U.S. There are an abundance of good used planes priced from $13,000 for a serviceable 150, to perhaps $45,000 for a nice example of a 172. Cessna 152s’ can be rented from as little as $65 per hour wet in some areas. Where the 162 is intended to fly, there are no used airplanes, China only has a few hundred civil aircraft in a country of 1.3 Billion residents, and India has 1.1 Billion people. It is now easy to see why Cessna is not overly concerned with American 162 sales, although we may guess the public relations team for the 182s and 172s are not sleeping well lately.

    Cessna has developed a business plan that will be studied at the Wharton School for the next 15 years! They have the greatest name in private aviation, took it global, with no money down will make a fortune, and not rob sales from any of their current models!

    Don’t be naďve about the production of LSAs from Europe, they have been a proven product for years, and are built with precision and experience, if Cessna chose to have the Czechs build the plane, we wouldn’t be responding to your article today.

    By the way, the 172 is the most common trainer used in the USA today, one of the reasons? I weigh 195, my instructor is 185, fuel 120, headphones and flight bag 10. do the math. Chinese are smaller than
    Americans.

    Finally, Cessna could have avoided the question of Chinese origin if it was priced like a product of Chinese origin; every thing from China is significantly less expensive. If the 162 had an $89,000 base price, everybody would have swallowed hard and looked the other way.

    Sincerely

    Greg Gordon
    Naperville, IL

  8. Robert Mark Says:

    Interesting response Greg. I never said Cessna wasn’t in it to make money. Heck, they’re a good old U.S. corporation with stockholders.

    Making money is their job. Luckily for us, they also make airplanes while they try to keep the shareholders happy.

    Didn’t that concept of capitalism really get its start here in the states a few centuries ago? So why are you surprsied that some companies have gotten very good at it?

  9. Owen Says:

    Greg,

    Your point is fascinating. I certainly agree on the attractiveness of having a product to sell without having to invest capital in infrastructure – especially for a company that has such a large backlog of jet orders to deal with.

    I don’t know where you are getting your numbers from though. They’ve claimed a 700/yr capacity, so $670m seems like a reasonable revenue forecast, but wouldn’t $350m be a 52% profit margin? Isn’t that slightly on the laughably ridiculous side of realistic? That sounds like printing money to me. I was taught that 14% was typical for manufacturing, and a huge stretch for aerospace.

    Also, nobody seems to be able to acknowledge this, but SAC has been building Airbus & Boeing parts and assemblies for years, so they also have built a proven product for years, built with precision and experience.

  10. Dee Davis Says:

    I have tried three times to post on the Skycatcher blog, and was not brutal, but my posts were not added. I placed 2 deposits on the first day at Oshkosh. Having bought a brand new 206 3 years ago, and taking delivery in Independence was a great experience I wanted to share with my Daughter, as 1 of these was intended for us to teach her to fly in. I called my dealer to cancel my orders, and collect the refundable deposit the last week of November when I found out the fine folks of Independance wouldn’t be building them. I still haven’t got my money back…and now I see they have killed the Skycatcher page on the Cessna site…Hmmm.

    Dee Davis

  11. Shane Says:

    In addition to issues in shipping jobs out of the United States and with products from China ranging from poisoned tooth paste, tainted dog food and dangerous children’s toys, the following news article highlights one of the most compelling reasons Cessna should avoid manufacturing in China — gross pollution, something that on a global scale, GA aircraft are beginning to see increased scrutiny over due to the leaded fuels they use (see news of emission monitoring at California’s Santa Monica airport).

    http://www.eurekalert.org/pub_releases/2008-03/uoc–agi031008.php

    Shipping production to a country that has a proven track record for disregard towards the environment will only lead to increased efforts to rid the US of any emissions to counter China’s massive contribution to global warming. LEt’s face it, cars aren’t going anywhere so the easy target is those “toys” people call airplanes. To put it in simple terms; it’s just a matter of time before the EPA (especially California’s government) takes action against GA aircraft because no other efforts are effectively decreasing global CO2. In essence, Cessna could be harming GA much more than they are helping.

  12. Lee Says:

    Anyone using a Rotax motor in an Aircraft should be labled a fatalist, and life insurance denied.
    Everything Bombardier makes is junk.

    The Continental was wisely chosen for reliability.

  13. Andrew Poth Says:

    It’ll be rather hard to buy a SkyCatcher or take flying lessons with the wages earned from flipping burgers. When will corporate America (and Congress) learn that we need good-paying professional and manufacturing jobs here in the U.S. to maintain a high standard of living. I used to argue about this with my business school instructors in the mid-1980s, who said we were moving to a “service economy”. The coming worldwide depression will prove them wrong and will prove me right, unfortunately.

  14. Jon Says:

    This is a necessity in order for flying to remain affordable to the middle class. I have an iPhone which is one of the best made products I have ever purchased, designed in the USA, built in China. I expect the 162 to follow similar standards.

  15. Ryan Says:

    The only problem I see with the new 162s is competition with a market full of used cessnas especially the 150s which it’s supposed to be the evolution of. I just checked e-bay and if used 150s, 172s are fetching between $20-50k I don’t see the point in trying to market pretty much the same plane with updated avionics and fancy seats for $115,500. It has the same engine for crying out loud. People forget that airframes are not like automobiles they don’t rust out or wear in the same ways. There’s a reason aircraft built in the 40s still fly today on a regular basis, they were built extremely well for the task at hand.

    As far as “good-paying” jobs, the economy has gone service industry and it’s been doing it for the past 25years. Let’s face it, I don’t know annyone who flies at my local flying club who is flipping burgers. They teach in international trade that comparative advantage always finds the most economical way to manufacture goods and services to maximize profit regardless of the complaints of society.

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