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What do buyers want?
AOPA Turbine Logbook
February 2012
Randy Groom
What do turbine aircraft buyers consider when evaluating one aircraft versus another? My experience suggests that motivations have changed over time and will continue to evolve.
When I was a young pup working for Beech in the 1980s, I attended various sales schools and had access to some great mentors. The schools outlined that selling was pretty cut and dried. An aircraft’s value could be graphically presented, with price on the X axis and a composite of speed, range, and cabin size on the Y axis. Wow, that seemed easy—too easy. My mentors said that there were a lot more emotional triggers at work, such as ramp presence, image, and, of course, perceptions of safety. Here’s the surprising thing: Fuel efficiency wasn’t mentioned as a priority. “Turbine buyers don’t care about fuel burn,” was the common refrain from the experienced salesmen.
In the early 1990s, however, things started to change. More and more owner pilots were moving up from piston engine airplanes to turboprops and light jets. These new customers did seem to care about fuel burn. That was helpful to those of us selling turboprops. But then Cessna answered with the Williams-powered CJ series and seriously narrowed the gap in fuel efficiency and operating costs.
Then, in the mid-1990s, things got even more complicated with the growing acceptance of the single-engine turboprops. As a King Air salesman at the time, I recall being very dismissive of the relevance of these new entrants. After all, who in the world would spend $2 million to $3 million for an aircraft with only one engine? I recall one King Air demo where we took a prospect considering a single-engine turboprop out over the ocean. Then we shut one engine down and said, “OK, now where would you be if this happened to you in your Pilatus or TBM 700?”
Well, it turned out that was rather poor salesmanship. That customer bought the Pilatus, and the single-engine turboprops continued to carve out larger chunks of the market. In fact, they seemed to be expanding the overall market as many new buyers were showing up that we had never even heard of before. The singles were offering customers the ability to enjoy turbine aircraft reliability and safety, but with lower fuel burns than King Airs or any of the jets. Even so, many pilots and most corporate flight departments at that time were holding firm to the requirement for twin-engine redundancy in a turbine aircraft.
There was another big motivator on the minds of many turbine aircraft prospects: the idea that they could buy a turbine airplane for under a million dollars. This ambitious concept, chiefly pioneered by Eclipse, captured the imagination of thousands of would-be turbine buyers. Other start-up manufacturers attempted to jump on the same bandwagon. But the cost of developing and manufacturing a new aircraft set in and these new start-ups flamed out, leaving a trail of disillusioned investors and order holders. The damage that was done by this unfortunate chapter has left a hefty (and perhaps appropriate) dose of skepticism of all new aircraft start-ups.
Apart from the very light jet (VLJ) debacle, the first decade of the new millennium started out with a bang. The entire industry was soaring to new heights, and turbine aircraft of all segments were selling well. Then, of course, the curtain fell in 2008. Backlogs started to evaporate, and light and mid-size jets stopped selling. Washington made matters worse by demonizing corporate aircraft. But interestingly, turboprop sales—both singles and twins—held on. Buyer motivations were changing to place greater value on operating costs and efficiency. And many corporations wanted to get away from the negative stigma associated with corporate jet ownership.
So what is the outlook for the future? As the United States and much of the global economy continues to struggle, buyers will clearly focus on getting the most value for their aircraft investment. Efficiency and operating costs will play a larger role in aircraft selection, along with the traditional measures of price, speed, range, and cabin size. This will create opportunities for those aircraft manufacturers that can squeeze the most aerodynamic and powerplant efficiency out of their products. It will also create a real opening for the introduction of a single-engine jet, propelled by the increasing acceptance of single-engine turboprops. This is a tough time for the general aviation industry. But for those manufacturers that have the vision and commitment to invest now in new, efficient aircraft, the future will be incredibly bright.
Randy Groom has more than 30 years’ experience in the general aviation industry and has been on the senior leadership teams at Beechcraft, Piper, and Piedmont Hawthorne Aviation. He is the president of Groom Aviation LLC, a consulting firm exclusively focused on GA. He is the proud owner of a Beech Bonanza and an Aviat Husky.
Randy Groom has more than 10,000 flight hours.