AutoGyro issues??

[Philbennett]

Autogyro-Insolvenz: Das sagt das Hildesheimer Unternehmen

Hildesheim - Schwierigkeiten gab es in den Vorjahren schon öfter – nun ist die Firma zahlungsunfähig. Cor ona war offenbar zu viel – doch es gibt auch Hoffnung.

www.hildesheimer-allgemeine.de

 

[XXavier]

Incredible... I believed that AutoGyro was the most profitable of the 'big three'...

 

[Philbennett]

Actually been told not insolvent just some process for dealing with legacy issues in German law.

 

[Tyger]

Since it's in german, and behind a paywall, can you give us a synopsis?

 

[BEN S]

I thought you were referring to more mast cracking....

 

[Philbennett]

Hi - actually I couldn't read the extra content and posted thinking others might have a wider insight, but having posted I spoke with the CEO and asked. He told me that actually the company isn't going out of business merely entering into an arrangement to get rid of some legacy financial issues and this is a particular way it needs to be done in Germany because of the law.

 

[XXavier]

Actually been told not insolvent just some process for dealing with legacy issues in German law.

The press note says that they had frequent financial difficulties in the past years... And that the company is now apparently unable to meet its financial obligations...
That sounds bad...

P.S. Just found this: https://www.fliegermagazin.de/news/autogyro-vorlaeufige-insolvenz/

Automatic, unretouched translation with DeepL:

In particular, the impact of the corona pandemic on the key markets in Asia and North America has significantly reduced the company's room for maneuver, according to a company release. In addition, some of the company has been working short time in recent months.

The provisional insolvency is not a declaration of bankruptcy, however, according to AutoGyro boss Gerry Speich, but the first and well-considered step of a comprehensive restructuring strategy.

Production continues to run at full capacity until the end of January, the company announced. 78 people are employed at the Hildesheim site.

Especially in the USA, there is a good chance to win new buyers: In summer 2019 AutoGyro received approval from the US Federal Aviation Administration FAA for the two models Cavalon and MTOsport 2017, both powered by the 141 hp Rotax 915iS.

In addition to private interested parties, AutoGyro is also hoping for customers, especially in the commercial sector.

 

[Tyger]

It sounds like what we'd call "Chapter 11" here in the US...

 

[dinoa]

Wonder what “legacy financial issues” they are referring to.

 

[Tyger]

The biggest problem with Icon was that their "projected" $139,000 price tag was not realistic. The A5's actual price is nearly twice that. And the fact that it can't really carry two 200lb guys with a full tank of fuel is also kind of a dealbreaker for many folks, IMO.
A lot of people that looked to be buyers in the low six figures totally evaporated, and a couple of very high-profile fatal accidents put the slam on much of their slick advertising to non-pilots.

 

[Tyger]

Actually, I was on the Icon list and would have bought one at $139K. Not at $259, though, which is what they proposed to me when the reached my spot two years ago. I know a lot of others ahead of me dropped out in the same time frame. For now, with the management change, they seem to be only offering fully-loaded "limited edition" ones which adds another 100k. You could have three Seareys for that kind of money.
Incidentally, the pilot you are referring to was a retired BASEball player, who had a PPL SEL/MEL, and an instrument rating. He obviously could have afforded to buy almost any plane he wanted.

 

[fara]

Actually, I was on the Icon list and would have bought one at $139K. Not at $259, though, which is what they proposed to me when the reached my spot two years ago. I know a lot of others ahead of me dropped out in the same time frame. For now, with the management change, they seem to be only offering fully-loaded "limited edition" ones which adds another 100k. You could have three Seareys for that kind of money.
Incidentally, the pilot you are referring to was a retired BASEball player, who had a PPL SEL/MEL, and an instrument rating. He obviously could have afforded to buy almost any plane he wanted.

Yes you are right. He was a baseball player. His ratings aside there is a clear video caught of him from a boat doing loops dangerously low.

When I stood up Searey's production assembly line for SLSA, they had Sport (basic 100 HP) model for $125k and Elite (carbon fiber 914 model) for $147k. I thought they were priced a bit too low. I advised them to increase the price by $12k on each. The same plane in China is CAAC Type Certified and sells at $100k more. They sold around 40 or so there.

 

[Tyger]

This goes back to the problems of excess capacity/inventory and overall pricing, which you pointed out earlier. It's nice to sell things for a higher price, but if the product is not moving you have to move quickly to get rid of what you have already made, before your factory builds even more of what people aren't buying. It's a constant balancing act, even for the car industry. Yes, they have large distribution networks, and they can foist some excess production on dealers, but the "model year" concept makes it even more imperative to move inventory before it gets "stale". No one is going to buy a never-driven 2019 car for anywhere near the same price as a 2021 of the same model.

 

[Tyger]

Incredible... I believed that AutoGyro was the most profitable of the 'big three'...

I have no knowledge of the profitability of any of the "big three", so I am just curious what you based that belief on.

 

[C. Beaty]

And all that stuff hanging on a poor little, unusually lumpy Bensen Rotor.
But man, check those Spaceman Spiff wheel spats!

 

[hillberg]

Damn a lot of 120+K & 240+K for a machine that can't hover nor a type certificate in the US?
A few years back I got a friend a Bell 206 A for 120K - Used with great times, Less then 5 grand in foo foo it looked and flew like new.

 

[XXavier]

I have no knowledge of the profitability of any of the "big three", so I am just curious what you based that belief on.

On sales... Of course,I know that selling more doesn't, by itself, means more profits, but with a prudent management, it should.

 

[Gyro_Kai]

this is the English link:

AutoGyro files for preliminary Insolvency

www.auto-gyro.com

 

[Tyger]

Their statement sounds very much like wishful thinking... I'm not sure how they imagine that their machines' approval as primary category aircraft "opens up new sales opportunities, especially in the commercial market" when the FAA have specifically stated that "a primary category aircraft... is intended exclusively for pleasure and personal use".

 

[Brian P]

By the time autogyro released their products to the market years ago there was a massive pent up demand. Maybe the market is just saturated now.