Club Homepage Forums Classified Ads Buy & Sell - Everything But Airplanes cessna 150 prices

I think a big chunk of the price goes to product liability insurance.

Assuming your labor is worth zero, right? <img src="/ubbthreads/images/graemlins/smile.gif" alt="" />




But that's the main point of LSA - "out of the box". No assembly required, and it's not a 30-40 year old airframe. I agree that $100k is a lot of money, but it's still way cheaper than any other new airplane.

Granted, us experienced plane owners know that used planes with equivalent capability can be had for a lot less, but it took a lot of education to reach that point. I suspect a lot of potential airplane owners shied away from the daunting task of due diligence on a decades-old design. For them, "brand-new" carries a lot of comfort.

Also, these planes (like ours) can be financed. Picking a long-term (20-year) loan at 6% on $100k yields a $717 monthly payment. Steep, yes, but more affordable than dropping $100 large all at once. Put 20% down and the payments drop to $574/month.

I think Cessna has long-term smarts in mind for this Cessna 158. First off, get the new pilots started in Cessna and they'll stay with the brand. And it's not just the owners who buy one. It's all the pilots who train in one owned by a flight-school, all the instructors who teach in one, all the A&P's who work on one. If all you have heard is "Cessna", then that's where you'll look when looking to buy, whether it's for yourself, your flight-school, your charter-op, your corporate flight department....

This will also 'legitimize' the whole LSA industry, just like IBM did for 'personal computers' when they introduced their original PC. With Cessna in the market, LSAs will be considered 'real' airplanes as opposed to fully-faired ultralights. Rotax will become a mainstream powerplant. LSA instruction will become more plentiful. I believe there's a lot of people on the sidelines, watching and waiting to see how the LSA industry pans out. If a 'real' airplane company like Cessna (instead of all these "funny-sounding furrin' comp'ny's") produces an LSA, well, then it's probably something worth looking into. Worth offering instruction, rental, maintenance, sales.

I, for one, remain bullish on the LSA industry. I do suspect that in 5 to 10 years time a lot of the current companies will no longer be around. As the industry matures the bit players will fall by the wayside, and only those companies with good designs and resources will still be around. But the overall industry will be quite strong, and I wouldn't be surprised to see a Cessna 158 pull up to Clinton 2010.

Who knows! I'll retire with a nice pension in 2012. If I no longer pass a flight medical then, and my investments have good returns, you might see me pull up in a Cessna 158.

We'll have to change names to the Cessna15xclub.com

Hung,

I don't know if this would carry over but logic would dictact that it does:

When I bought a factory new engine for the split tail 2 1/2 years ago, Continental told me a full 1/3 of the price of the engine was for liability insurance.

Now, he may have just said that to make the pill easier to swallow or to divert my attention of the total dollar amount away from Continental (the blame game) but if he was shooting me straight, would not the same ratio carry over to the airframe side?

Jim

Pure speculation here, but if what you were told is true about 1/3 of engine cost being liability insurance costs, I would expect a larger proportion of airframe cost would be insurance cost related. The aircraft manufacturer may be found liable for any component installed in the aircraft, including any airframe or engine discrepancy resulting in mishap! The lawyers would go after the big game (Cessna, Piper) then hunt rabbits (Continental, Lycoming, etc.) incidental to the original suit.

In 1974 my father and his business partner purchased from the factory at Independence KS, a new Skylane, VFR equipped. They bitched and moaned all the way home about the outrageous price they had to pay for the plane - $24000

It's all relative....

Yeah, it's the manufacturers' liability insurance situation that has hurt the industry.

In the mid-seventies, a widow whose husband died in the crash of a 35 year old Bonanza was awarded beaucoup millions in a a wrongful death lawsuit against Beechcraft.

Her husband died when a worn seat lock let go on a takeoff....

the rest of us have been paying for that little legal decision ever since.

Excellent point Carl.

It would make sense that the airframe manufacturer's liability would be all encompassing - any and all components plus their airframe would be their exposure.

The 18 year limit law they passed doesn't seem to have helped much in regards to keeping costs down. Who knows, maybe the new engine would have been even more expensive and 1/2 of the cost would have gone for liability insurance without the 18 year law.

Jim

There are many similar threads over on the aopa web site.. I just think it's normal inflation. Depending on which economic deflator you use (like the CPI, etc) if you compute $20K, what a comanche sold for in 1960, to todays dollars, you end up somewhere between $100K-$400K, pretty much right where a single engine plane sells today.


Could it be because it was never really the only issue?

As with everything in life I'm sure the answer lies somewhere in between what the manufacturers tell us about liability and what the lawyers tell us.

Here's something interesting I ran across. That would seem to bear out the "somewhere in the middle theory"

"The Federal Interagency Task Force on Product Liability, under the direction of the Department of Commerce, in its Final Report issued November 1,1977, found that the cost
of product liability insurance had risen dramatically, making it more difficult for some small firms to obtain adequate insurance coverage. The major causes of the dramatic rise in rates, the Task Force found, were irrational premium setting procedures by insurance companies , the manufacture of products that are not as safe as current technologies would allow , and
uncertainties as to how personal injury litigation is conducted ."

So the causes were 1-the insurance companies did it, 2-the producers made "unsafe" products, and 3-the possibility of outrageous judgements.

So maybe right after the govt tackles tort reform, they can get to insurance reform, and product reform and heck since inflation is still under wrap maybe in 40 years those $100K LSA's will only cost a million

-Henri