Cirrus Aircraft's new Chinese owners will provide a nearly $100 million investment to complete development of the company's long-delayed personal jet, the Vision SF-50, a project that could create hundreds of jobs in Duluth and Grand Forks, N.D.
The Duluth-based company expects to deliver its first plane in 2015. But aviation analysts and safety advocates question just how successful and safe the jet will be.
Cirrus made its name with a sleek four-seat piston-engine plane that is the only aircraft in the market with the protection of a full-plane parachute.
Inside the Cirrus facility in Duluth, about 300 workers assemble about five planes a week. That's a third of what the company cranked out before the recession, when Cirrus employed 1,400 people, including about 900 in Duluth.
The company markets its propeller-driven planes as easy to fly, with all kinds of customizable electronics. The SR-22 — one of two models — has been the best selling general aviation airplane for the past decade.
"Excitement and innovation — it's part of the fabric of the company," Executive Vice President and COO Pat Waddick said. He said Cirrus is applying that same spirit to the new jet.
"This is really integral to the founding vision, appropriately so," he said.
Waddick calls the jet the future of Cirrus — a future that received a huge boost today from China Aviation Industry General Aircraft Co., which purchased Cirrus last year. Waddick says the Chinese company's $100 million investment is on top of nearly $50 million Cirrus has already spent developing the jet over the past decade.
By making the Vision SF-50, Cirrus is trying to bring the first single-engine jet to the marketplace. The seven-seat plane, now priced at $1.72 million, will sell for just under $2 million in July — about half the price of small, twin-engine jets. Waddick said it will fill a significant gap in the market.
“Excitement and innovation — it's part of the fabric of the company,” Executive Vice President and COO Pat Waddick said.Pat Waddick, Cirrus executive vice president and COO
"There is a hole really between what we would call traditional light general aviation, and some of the more expensive business jets," he said. "And there has not been a good airplane to allow people who are flying for example our SR22 airplanes today, to [reach] a next logical step."
It's unclear how big the Vision's market will be.
Waddick says nearly 500 customers put down $100,000 deposits on the Vision, although some asked for refunds when the jet was delayed during the recession.
Richard Aboulafia, an aviation analyst for the Teal Group outside Washington, D.C., said demand might be on the light side.
"At the end of the day the market for very light jets has proven to be much smaller than expected, and the market for small, single-engine personal jets is unknown, and probably even smaller," he said.
Aboulafia also cautions that Cirrus still has a long way to go even to get the jet to market, if other companies are any indication.
"In terms of actually arranging for production, distribution, support — all those other things — a lot of aircraft have made it to the point where it's built and flying," he said. "But then they stumble when it comes to actually delivering it to the customer."
Waddick, the company's COO, said Cirrus is focused on building the first of three flight test planes that it will need as part of the Federal Aviation Administration's certification process. Waddick hopes the jet will feature the parachute that's the hallmark of the company's piston-engine plane.
But he acknowledges there are technical hurdles to overcome, among them the laws of physics. The 6,000-pound jet will travel at 300 knots.
"That's a lot of energy to manage," Waddick said.
Cirrus officials said the parachute has saved 53 lives in the older models.
But aviation lawyer Mike Danko believes the parachute and other safety measures may undermine a pilot's caution and lead to unnecessary risks. He also questions the message in the company's marketing.
"The Cirrus is very easy to fly. If you now drive a BMW, you could be going to the same place, flying your Cirrus," Danko said. "And the truth is that Cirrus may be attracting pilots who don't have the mentality that it takes to fly safely."
That could be exacerbated in a new jet that will travel at over 300 miles per hour, worries Danko, who owns a propeller-equipped Cirrus plane.
Waddick disputes that. He said over the last 20 years, flying aircraft has become safer and easier.
It will be years before the questions about the Vision jet are answered. But in the meantime, Cirrus is adding jobs.
The company will be hiring 100 engineers and technicians to help develop the Vision. Hundreds more jobs are possible when production begins.
"The jet represents the future of the company," Waddick said. "It represents growth of the company — and that also means jobs."