PPRuNe Forums - View Single Post - R44 Cadet
Thread: R44 Cadet
View Single Post
Old 27th Oct 2016, 16:40
  #60 (permalink)  
CRAN
 
Join Date: Mar 2002
Location: UK
Posts: 489
Likes: 0
Received 1 Like on 1 Post
The price of Recreational Helicopters

I recall a comment from Bruno Guimbal a year or so ago, when he said:

"The market appears to be trust sensitive, rather than price sensitive..."

IMHO this is a misunderstanding or misrepresentation of the facts...his machine is priced ABOVE the part of the market that is price sensitive! His clients are flying schools that lease machines and work them hard, or very wealthy individuals. The VAST majority of private pilots and would-be owners cannot afford anything like the price of a new R22, R44C, R44R1 or R44R2 or Cabri. These machines have all drifted in the realm of the very-wealthy which is a MUCH smaller market.

Then there is the 12-year depreciation issue for private owners and the blade issues and the corrosion issue if you live anywhere other than a desert!

R22 was introduced in 1979 with a base price of $40,000, that's $133,018.18 in todays dollars according to Inflation Calculator | Find US Dollar's Value from 1913-2016. (Actual list price today is $288,000, more than double!)

When the R22 was introduced at the original price point they were selling 500 per year and couldn't build them fast enough!

At less than $150K we are into performance car money and there is a market for 100,000's of those per year and lots of professional and small business owners are willing to spend that kind of money. If you then look at today's price of the R44 Cadet we are talking about $339,000, that's supercar money...now just 10% of those performance car buyers can afford your product. Of course if you then build-in an expensive fixed 12-year, rather than 2000-hr overhaul requirement then you have huge running costs also). Its all just drifted out of reach for Robinson's original target market.

If Robinson want to see a return of their volume production they need to reconnect with their customer base. Not only has the cost of purchasing their machine moved out of reach of their target market, the running costs for private owners has massively increased due to the escalating cost of overhaul.

I think Robinson is at risk of 'slipping onto the backside of the financial power curve'. Their products have been pushed up in price gradually over the last 30 years gradually alienating their 'true' client base. Since the 2007 financial crash this has resulted in a major slow down in demand, which in turn increases the effective cost of production...now its difficult to drop the price to stimulate demand...and so on.

If you drift into the realm were cost doesn't really matter to your customers, then they'll just buy the best...how will the R44 and R66 stack up against a Guimabl G4, which will doubtless be pretty, crashworthy, 3-bladed and quiet.

Of course Monsieur Guimbal may also choose to exploit the fact that the Lycoming O-540-F1B5 used in the Raven 1 is actually approved for automotive fuel so the fuel cost of your four seat helicopter outside of the USA could be reduced by up to 40%! Why Robinson hasn't sorted this out is also completely beyond me.

Just my 2p worth!
CRAN is offline