While I'm interested in electronic ignition and am aware of the benefits, I've been struggling with the ROI on the Aztec... mostly because the company wants full ticket for it (2X the cost of a single) even though the STC is for one airframe. Seemed willing to engage me but dropped the discussion when I asked if the marketplace was telling me if I was wrong.
So that left my question open.... has anyone that you are aware of bought an electronic ignition for their aztec?
Here is the dialog if anyone is interested in following along. Start at bottom. The context was is I have some money again for upgrades this year and was going to consider the ElectroAir ignition system. I'm at a point now where this Aztec may be a keeper for the fore-sable future so my ROI timeframe is not as short.
-Jeff
--------------------
---------- Forwarded message ----------
From: Jeff King <[email protected]>
Date: Thu, Mar 5, 2015 at 12:39 PM
Subject: Re: Electroair Electronic Ignition for Lycoming 6cyl
To: <[email protected]>
Not at all an apples to oranges comparison, in fact just the opposite now that your pricing model logic is clear to me... the value of VG's are tenfold going from a single to a twin. Guess you're not a twin operator. We have something called Vmc. VG's are a nice to have on a single... on a twin they are almost mandatory. Micro VG easily could have shaken us down but chooses to only rattle us a little compared to the single operator. Yet anyone who cares about safety has VG's on their twin. I added mine when I bought the aircraft.
You also haven't been in the market for a twin. The twin market has collapsed and will remain that way. I use Vref and what I actually pay. I paid $33K for my flying 1965 Aztec twin in 2012. Put maybe $10K into it. The Vref retail for a 1960 Aztec is $30K, 1965 Aztec is $35K, a 1970 $50K and a 1975 $65K. If you are an AOPA member you can get access to Vref estimates.
That's a reservation in the sense I'd never get the money out of the upgrade. For $11K I can buy a GTN650 and another $2K installs it. Yet it dramatically increases the resale of my aircraft. Electronic ignition might even have the opposite effect. Maybe the owner might give me a few K for it if he is educated on the benefits or more likely his prebuy AP is old school and will be telling him he has to ripe out the Electronic ignition because they are unreliable (and yes I've seen these very discussions)
But saving on fuel is a big deal. That's where ROI comes into play. For an economic play as a 100hr/yr flyer I need an ROI of <5 years or ideally the no-brainer of <3 years. Light-speed gives me that <3 year ROI... but not the STC I need. RIght now you are calculating out at 8+ years ROI. That's a hard sell.
At $5000 out the door both fans I think you'd be selling these briskly to the Aztec market. Lots of them out there with thirsty IO-540's. $7K I'm thinking about it because I know there is more to EI then just economy. $11K + installation... I'm reminded Vref tells me my plane is worth $35K as it stands now with no factor for EI. Between that resale concern and the ROI I'm not pulling the trigger. It's not personal.
Now am I wrong about the Aztec/6 cylinder Twin market? Has any Aztec owner bought one yet? I really *do* think there is a market for EI with the Aztec... perhaps even significant. But the pricing/ROI has to make sense.
But I only speak for myself.. the resale/ROI I can't get my hands around. Interested if any other Aztec flyers are seeing it differently then me.
Regards,
Jeff
On Thu, Mar 5, 2015 at 11:58 AM, <[email protected]> wrote:
Jeff-
Not to be argumentative, but your example is an apples-to-oranges example. I don't think the benefit from VGs doubles when you move from a single engine aircraft to a twin. The wing dimensions are not double. A twin engine has two engines, therefore the fuel savings is double that of a comparably "engined" single engined aircraft.
The other issue that you have observed is you value your aircraft at $40K (that doesn't make sense with a quick review of prices, but you have arrived at that value). I might agree with you that the investment into electronic ignition systems may not make sense with the value of your aircraft. I have similar discussions with operators of aircraft like Aeronca Champs too - the investment probably doesn't line up with the airframe.
Thanks...
On Thu, Mar 5, 2015 at 11:46 AM, Jeff King <[email protected]> wrote:
That logic makes no sense. With MetcoAire VG's.. the cost difference between a PA32 and a Seneca twin is not double... not even close. In both these cases the twin and single operator get one STC based on the air-frame. The twin operator would be paying more regardless so not sure why the class warfare comparison. You pricing model should take into consideration the airframe as well.
Listen, I'm a firm believer in electronic ignition but I also have to look at the ROI... paying 25% of the value of my aircraft for EI is tough enough for me let alone the ROI for a 100hr a year pilot is 8+ years at your current pricing model just is a non-starter.
Just giving you a chance for a sale. Your company, your choice. But makes no sense to me.
Good luck.
On Thu, Mar 5, 2015 at 11:27 AM, <[email protected]> wrote:
Jeff-
Thank you for your email. I have not changed our pricing model for the ignition systems. The benefit for a twin engine aircraft is twice that in a single engine aircraft. If I were to follow your suggestion, operators of single engine aircraft would then feel penalized price-wise.
I hope you consider our systems for your aircraft. Again, I will be happy to forward you to a distributor. Please note, we are planning a price increase that will go in effect June 1.
Let me know if you have any additional questions.
Thanks again...
On Thu, Mar 5, 2015 at 11:09 AM, Jeff King <[email protected]> wrote:
Hi :
Planning again for my annual as to what upgrades I want to do. I'll once again ask if you've rethought your pricing model for twins so as not to penalize them unduly for the 2nd engine as compared to single engine aircraft. As a reminder what I was suggesting was standard pricing for the first STC'e unit and then an aggressive discount on the 2nd one... somewhat in line of the cost of the experimental unit. I.E. A 6 cylinder twin setup would be in the $7000 street price range instead of $10-$11K range.
I fully understand the need to recover the cost of the STC airframe certification, but that recovery is being done twice in the case on a twin airframe.
Let me know as I'd like to consider your product as I'm choosing what to do this year.
Regards,
Jeff King
So that left my question open.... has anyone that you are aware of bought an electronic ignition for their aztec?
Here is the dialog if anyone is interested in following along. Start at bottom. The context was is I have some money again for upgrades this year and was going to consider the ElectroAir ignition system. I'm at a point now where this Aztec may be a keeper for the fore-sable future so my ROI timeframe is not as short.
-Jeff
--------------------
---------- Forwarded message ----------
From: Jeff King <[email protected]>
Date: Thu, Mar 5, 2015 at 12:39 PM
Subject: Re: Electroair Electronic Ignition for Lycoming 6cyl
To: <[email protected]>
Not at all an apples to oranges comparison, in fact just the opposite now that your pricing model logic is clear to me... the value of VG's are tenfold going from a single to a twin. Guess you're not a twin operator. We have something called Vmc. VG's are a nice to have on a single... on a twin they are almost mandatory. Micro VG easily could have shaken us down but chooses to only rattle us a little compared to the single operator. Yet anyone who cares about safety has VG's on their twin. I added mine when I bought the aircraft.
You also haven't been in the market for a twin. The twin market has collapsed and will remain that way. I use Vref and what I actually pay. I paid $33K for my flying 1965 Aztec twin in 2012. Put maybe $10K into it. The Vref retail for a 1960 Aztec is $30K, 1965 Aztec is $35K, a 1970 $50K and a 1975 $65K. If you are an AOPA member you can get access to Vref estimates.
That's a reservation in the sense I'd never get the money out of the upgrade. For $11K I can buy a GTN650 and another $2K installs it. Yet it dramatically increases the resale of my aircraft. Electronic ignition might even have the opposite effect. Maybe the owner might give me a few K for it if he is educated on the benefits or more likely his prebuy AP is old school and will be telling him he has to ripe out the Electronic ignition because they are unreliable (and yes I've seen these very discussions)
But saving on fuel is a big deal. That's where ROI comes into play. For an economic play as a 100hr/yr flyer I need an ROI of <5 years or ideally the no-brainer of <3 years. Light-speed gives me that <3 year ROI... but not the STC I need. RIght now you are calculating out at 8+ years ROI. That's a hard sell.
At $5000 out the door both fans I think you'd be selling these briskly to the Aztec market. Lots of them out there with thirsty IO-540's. $7K I'm thinking about it because I know there is more to EI then just economy. $11K + installation... I'm reminded Vref tells me my plane is worth $35K as it stands now with no factor for EI. Between that resale concern and the ROI I'm not pulling the trigger. It's not personal.
Now am I wrong about the Aztec/6 cylinder Twin market? Has any Aztec owner bought one yet? I really *do* think there is a market for EI with the Aztec... perhaps even significant. But the pricing/ROI has to make sense.
But I only speak for myself.. the resale/ROI I can't get my hands around. Interested if any other Aztec flyers are seeing it differently then me.
Regards,
Jeff
On Thu, Mar 5, 2015 at 11:58 AM, <[email protected]> wrote:
Jeff-
Not to be argumentative, but your example is an apples-to-oranges example. I don't think the benefit from VGs doubles when you move from a single engine aircraft to a twin. The wing dimensions are not double. A twin engine has two engines, therefore the fuel savings is double that of a comparably "engined" single engined aircraft.
The other issue that you have observed is you value your aircraft at $40K (that doesn't make sense with a quick review of prices, but you have arrived at that value). I might agree with you that the investment into electronic ignition systems may not make sense with the value of your aircraft. I have similar discussions with operators of aircraft like Aeronca Champs too - the investment probably doesn't line up with the airframe.
Thanks...
On Thu, Mar 5, 2015 at 11:46 AM, Jeff King <[email protected]> wrote:
That logic makes no sense. With MetcoAire VG's.. the cost difference between a PA32 and a Seneca twin is not double... not even close. In both these cases the twin and single operator get one STC based on the air-frame. The twin operator would be paying more regardless so not sure why the class warfare comparison. You pricing model should take into consideration the airframe as well.
Listen, I'm a firm believer in electronic ignition but I also have to look at the ROI... paying 25% of the value of my aircraft for EI is tough enough for me let alone the ROI for a 100hr a year pilot is 8+ years at your current pricing model just is a non-starter.
Just giving you a chance for a sale. Your company, your choice. But makes no sense to me.
Good luck.
On Thu, Mar 5, 2015 at 11:27 AM, <[email protected]> wrote:
Jeff-
Thank you for your email. I have not changed our pricing model for the ignition systems. The benefit for a twin engine aircraft is twice that in a single engine aircraft. If I were to follow your suggestion, operators of single engine aircraft would then feel penalized price-wise.
I hope you consider our systems for your aircraft. Again, I will be happy to forward you to a distributor. Please note, we are planning a price increase that will go in effect June 1.
Let me know if you have any additional questions.
Thanks again...
On Thu, Mar 5, 2015 at 11:09 AM, Jeff King <[email protected]> wrote:
Hi :
Planning again for my annual as to what upgrades I want to do. I'll once again ask if you've rethought your pricing model for twins so as not to penalize them unduly for the 2nd engine as compared to single engine aircraft. As a reminder what I was suggesting was standard pricing for the first STC'e unit and then an aggressive discount on the 2nd one... somewhat in line of the cost of the experimental unit. I.E. A 6 cylinder twin setup would be in the $7000 street price range instead of $10-$11K range.
I fully understand the need to recover the cost of the STC airframe certification, but that recovery is being done twice in the case on a twin airframe.
Let me know as I'd like to consider your product as I'm choosing what to do this year.
Regards,
Jeff King
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