Message-ID: <3901522C.366DFEEA@regandesigns.com>
Date: Sat, 22 Apr 2000 00:18:04 -0700
From: "Hamid A. Wasti" <hamid@regandesigns.com>
To: "lancair.list@olsusa.com" <lancair.list@olsusa.com>
Subject: Re: engines
References: <3900EEEE.FCB867E9@postoffice.pacbell.net>
Mime-Version: 1.0

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erosiak@pacbell.net wrote:

> However, I think that it's
> easy to understand why aircraft engine development  lags so far behind.
> Aircraft (and their engines) are manufactured in the hundreds.
>
> Automobiles are manufactured in the thousands. This volume and the
> profit resulting from it, provide R&D dollars which in turn spawn
> improvements, and the fierce competition holds the prices down.  Not so
> in the world of aircraft.

The volume is indeed a big factor; maybe the biggest.  Last fall, we discusses
a cost reduction project with a customer.  It was a only a development project
(no research needed); take an existing product and cost reduce it with minimal
impact to form and function.  Including the client's internal cost for managing
and supporting the program, the total cost to them came out to be about $300K.
With projected annual sales of only 20 systems, this would require a per system
savings of over $5K for a 3 year return on investment (the accountants wanted 2
years).   Our most optimistic estimate was that we might be able to save about
$5.5K.  With us meeting the target and no cost overruns, that left the client
essentially in a break even position.  It was not worth it for them to take on
the headache and risk of such a project and carry the debt for 3 years, before
they would see a return (cost savings).  If the same product was selling 100
systems a year, the per system cost of the redesign would be about $1K with the
part of the balance being passed on to the customer.

But the cost of development is only one half of the story.  The cost of
production is the other half. I have no experience with engine, automobiles or
aircraft manufacturing, but I can draw upon my experience with the production
if circuit boards.  If all you want is 2 boards, it makes sense for someone to
sit there and hand place and hand solder all parts on the board.  On the other
hand, if you are making 10000 boards, it makes sense to spend the tens of
thousands of dollars to set up an automatic placement machine that will
automatically place all the parts and the put them through a reflow oven to
solder them.  But pity the soul that has to make 200.  It is far too expensive
and unreliable to do by hand and often even more expensive to do
automatically.  The automatic machines require the parts to be loaded in reels,
the smallest reels for some parts being 3,000 pieces.  If only 1 part is used,
the remaining 2800 are scrap that have to be amortized over the 200 boards.
Besides this waste, the cost of setting up, loading and testing the the
machines is almost the same whether you do 1 board or 10,000.

Faced with such realities, I can understand why a company that makes 100's of
thousands of engines can afford to to spend millions on R&D and produce engines
that sell for a few thousand dollars or less, while a company that produces a
few 100 engines a year can neither spend money on R&D nor bring their price
down below a few ten's of thousands of dollars.  This does not take into
account the additional costs imposed to meet FAA requirements or the higher
cost of liability insurance.

As for liability and lawyers, there are two facts to keep in mind: 1) Lawyers
are in it for the money; one of them will be happy to sue you for the the
trauma of having to look at your face, if only he though he could prevail in
such a case.  2) Juries decide based on their perception of reality not the
technical merits of the case, which are frequently beyond their ability to
grasp.  Remember that a jury decided that the design of all taildraggers
(specifically a Piper Cub) is inherently unsafe in that it does not afford a
pilot enough forward visibility.

As long as juries keep believing that aviation is inherently unsafe they are
going to keep awarding judgments and the lawyers are going to keep suing --
plain and simple.  It is going to take a lot to change that perception.  It is
not going to come from the FAA, it is not going to come from the EAA, it is not
going to come from AOPA, it is going to come from you and me.  Talk to people
you know, tell them you are a pilot, tell them that a plane does not fall out
of the sky in flames as soon as the engine quits (you would be surprised at how
many people hold that truth to be self evident), tell them that it is extremely
rare for a wing to fall of,  tell them that there are no "air pockets", listen
to their misconceptions and fears and address them.  But most importantly, fly
safely yourself.  There is nothing that will reinforce the dangers of flying in
the mind of a person more than knowing someone that got killed in a "plane
crash".  One of the best things you can do for the long term health of general
aviation is to die of old age, or of some other natural cause.

Hamid


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