Financing The Long Haul

Cessna's Skycatcher endured a couple non-recoverable spins and parachute deployments in its intensive test program en route to earning SLSA certification. The process delayed deliveries by a couple years and no doubt the setbacks cost the aviationgiant an uncomfortable percentage of its initial 1,000 pre-orders (Cessna has never divulged just how many orders it lost).

Not long after the LSA category was made official in 2004, Icon Aircraft writ its name in stars across the promotional universe with one after another high-profile, flashy presentations at major air shows. Its beautiful, all-composite A5 amphibian also garnered a lot of pre-order support from a new customer base dazzled by the A5s heavily-pitched fun-in-sun, jet-ski-like utility and ease of operation. But the sleek aircraft has yet to earn certification, is rumored to be seeking a greater weight allowance from FAA than the standard 1430 lbs. for water-worthy LSA, and will not make it into production until at least late 2013, according to the most recent estimate.

Meanwhile the Terrafugia Transition Roadable Aircraft has endured one major design revision and a final retail price climb rate that would put any airplane's actual climb rate to shame. The company has also struggled to bring the flying car to market and has not yet earned ASTM certification, though it is in Phase 2 of flight testing and hopes to earn that cert soon. Delivery is set for next year at the earliest, says Terrafugia, and along the way the price has breached the quarter million dollar mark and could like Akoya end up costing more than $300,000.

Even longstanding kitmaker Progressive Aerodyne, which has delivered several hundred of its popular SeaRey kits over the years, has been trumpeting an SLSA version of the tube/fabric/composite amphibianfunship for a few years now, but has encountered protracted delays of its own en route to ASTM certification. You would expect the SeaRey at least would have been a slam dunk.

And now the latest to join the Frustrated Dreams Dept.: the Lisa Akoya, yet another amphibian LSA that debuted in the U.S. this year with a big, showy, expensive presence at the Oshkosh Airventure event. I just wrote a blurb on it a couple weeks ago for our upcoming Oshkosh Roundup article, in which we highlight new products and developments in General Aviation.

The "luxury amphibian" with sexy hydrofoil wings on its futuristic hull is luxurious alright: it's priced at $390,000 (or $350K or $370K depending on which source you read). Like the Icon A5, the Akoya is sleek, futuristic-stylish, and downright gorgeous.

There's only one problem: thenew company just declared bankruptcy!

Lisa acknowledged that its investors were unable to secure sufficient financing to keep the project going forward at its current pace. The company says customers who have made deposits shouldn't worry: their money is safe. Fundraising is active while the company endures a "six-month phase of observation" to discern, it seems, whether there's really a market out there for a $0.4 million two-seat, 120-knot max speed amphibious airplane. One tag line I saw online said Lisa was declaring bankruptcy so it could secure financing. Now there's a spin worthy of Presidential politics! "Hey, let's declare bankruptcy, that'll drive 'em to our showroom door!"

Okay. Is it just me? Or does it seem the old paradigm of gobbling up huge amounts of Other's People's Money in pursuit of aviation mega-success is, especially these days, a demonstrably, catastrophically outmoded get-rich-quick way of doing business? I'm not saying don't dream. I'm saying, dream responsibly. It's easy to get drunk on the power of our ideas. And drunk visionaries do not usually advance the march of civilization.

Maybe it's time that big thinkers like Vern Raeburn (Eclipse Very Light Jet) et al, these folks with, yes, often truly great ideas, nonetheless get off this program of feeling the need for investment capital speed and the compulsion to throw millions into promotion for virtual products that ultimately struggle for years before production, if they ever make it to production, and frustrate and often disappoint customers all through the nerve-wracking process.

Why can't we find a 21st Century way to do what we used to do: create prosperity and customer loyalty by living within our means, growing as the market for our products allows us to grow, and living Life, not as if its purpose was to make a huge killing, change the face of aviation, then retire at 40 to go buy an island somewhere, but as if contributing worthwhile, quality-made, useful and desirable products that earned their place in the market was in fact a damn good way to live, and indeed a respectable goal to aspire to in the first place?

I'm thinking of companies like Pipistrel; American Legend and CubCrafters; Flight Design and a few more. You know, all those folks who built a quality aircraft, then a business model that included responsible promotion along with a budget that would allow them to produce and refine the product, then expanded as they were able to do so.

Just sayin'.