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Van's Files for Reorganization Under Chapter 11

greghughespdx

greghughespdx

Well Known Member
Advertiser
In order to ensure the stability of ongoing and future operations, Van’s Aircraft has filed for reorganization under Chapter 11 of the Federal Bankruptcy Code. Following an in-depth internal assessment, this action is being taken to allow Van’s to continue to provide ongoing support for its customers, suppliers, and employees while dealing with serious financial issues. More information, including a video explaining the decision and what this means for the company and our customers, may be viewed at this link.

https://www.vansaircraft.com/2023/12/vans-aircraft-announces-chapter-11-reorganization/

The reorganization plan, while difficult, helps ensure we remain open and continue to serve customers.​
 
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VansAirForce.net and its forums remain committed to helping the tens of thousands of RV builders and owners safely enjoy their RV airplanes for the next several decades. Here we will continue building friendships, supporting each other and solving technical issues and questions while we live our RV journey.

Chapter 11 sucks, and I'm still absorbing the enormity of it, but these are the steps that were obviously needed to keep the company in existence. It could be a different hobby on the other side, but we will adapt. While it in fact may end up being a different, stripped down hobby, this website and amazing community will be here for RV builders and owners. With your help, I'll do everything in my power to keep this resource here for you for the long haul. Technical issues, motivational support and a sense of RV community. We're in this together.

My heart goes out to the employees affected by this. It just sucks. It just sucks.

Here we'll focus on adapting and overcoming the hill in front of us the best we can. I heard this before about the RV world, "It started out being about the airplane, but ended up being about the people and the journey." I think it will continue to be.

A reminder during this transition, there are posting rules regarding civility, etc. While this is not the news we wanted, I will remind the community that posts violating the rules will be deleted. Bashing, legal threats, civility, you know the bullet points. Folks that don't play nice are going to get their accounts locked down. If you need doom-scrolling and collective social screaming, take it to those places that do that. You gotta be you. Here we're going to focus on the future, support our RV community, and how to best help those still building. Working the problem with the resources we have.

There are tens of thousands of us. We're not going anywhere.

My goal is to keep VansAirForce.net and its forums in business so they can help as many builders and owners as they can. Just like the factory is hoping to do.

Wednesday's edition will be just like Tuesday's, a mix of RV technical and RV motivation. We are RV builders and RV pilots, and we will continue to be! RVators helping RVators.


PS: Mods, leave this thread open, but delete the replies that obviously violate the posting rules. I'll make the call on the grey area ones.​
 
Ouch. Not surprising and a well known financial recovery tool. In essence it buys time and stops the clock on collection efforts of creditors. Deep breath, it will work out...and certainly not the first company to use Chapter 11.

JJR
 
Important to focus on this being necessary for the long term survival of Van’s. This doesn’t have to be a negative, unless we make it such. Van’s was very forthcoming with information this evening, and it sounds like with patience, intends to make it right for those builders that are caught in the middle of this.
 
SPX said:
Important to focus on this being necessary for the long term survival of Van’s. This doesn’t have to be a negative, unless we make it such. Van’s was very forthcoming with information this evening, and it sounds like with patience, intends to make it right for those builders that are caught in the middle of this.
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Well said - and hopefully all those who partake in this forum likewise recognize the importance of ongoing support of this resource which becomes all the more important to the community, and provide financial support accordingly.
 
Greg, I'm sorry to hear this. I have several questions:

1) Does Van's have a DIP lender lined up (subject to court approval of of course) that will finance operations during the reorganization?

2) Does Van's have a proposed plan of reorganization drawn up already? If so, can you please share it with us?

3) What assurances do we have that if we pay the additional money for our unshipped kits that Van's will be able to ship them out?

4) If a customer does not accept the new pricing, are you going to refund their deposit?
 
Under Chapter 11:
Consumers who are owed refunds of their deposits have to get in line and compete with the other creditors for any cash that is available. In many cases, however, there is nothing the consumer can do but accept the fact that they have lost all or most of their deposit paid to the bankrupt business.

I'm sorry for everyone involved; Van's, customers with deposits paid, and the suppliers. A terrible situation for everyone involved. It will be painful for everyone involved, but while more expensive, Van's will survive and we will continue to have access to the best kit airplanes ever invented.



bmellis11 said:
Greg, I'm sorry to hear this. I have several questions:

1) Does Van's have a DIP lender lined up (subject to court approval of of course) that will finance operations during the reorganization?

2) Does Van's have a proposed plan of reorganization drawn up already? If so, can you please share it with us?

3) What assurances do we have that if we pay the additional money for our unshipped kits that Van's will be able to ship them out?

4) If a customer does not accept the new pricing, are you going to refund their deposit?
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Many successful companies have gone through or have come close to going through such as this. Often it is a result of great success of products outrunning bigger company processes. This can serve not only as the "wake up call' that all see, but as the "reset" that builds a stronger Van's Aircraft in the future.

Turnarounds are tough pills to swallow but when an entity comes out on the other side (as I whole-heartedly believe will be the case here), they are stronger, better, and more well-equipped for the future.
Clearly it will be tough for those with a lot invested and still in the midst of completion, but patience by us all will be one of the best things we can aid to aid in their success.

Working to complete my third RV.
 
I would suggest that Questions for Vans Aircraft might be better directed to the company. I wouldn't expect them to answer questions on this forum, especially under the legal circumstances.

Just one guy's opinion...........
 
jclark said:
Many successful companies have gone through or have come close to going through such as this. Often it is a result of great success of products outrunning bigger company processes. This can serve not only as the "wake up call' that all see, but as the "reset" that builds a stronger Van's Aircraft in the future.

Turnarounds are tough pills to swallow but when an entity comes out on the other side (as I whole-heartedly believe will be the case here), they are stronger, better, and more well-equipped for the future.
Clearly it will be tough for those with a lot invested and still in the midst of completion, but patience by us all will be one of the best things we can aid to aid in their success.

...
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James, you said it. I've got nothing to add except I've been through this before in the tech business. What I have seen during these transitions is that the customers usually come out fine. Anyone that is owed money - not so much. Even prepayments for services were honored by telecom companies, so I hope the Van's process protects customer deposits.
 
bmellis11 said:
Greg, I'm sorry to hear this. I have several questions:

1) Does Van's have a DIP lender lined up (subject to court approval of of course) that will finance operations during the reorganization?

2) Does Van's have a proposed plan of reorganization drawn up already? If so, can you please share it with us?

3) What assurances do we have that if we pay the additional money for our unshipped kits that Van's will be able to ship them out?

4) If a customer does not accept the new pricing, are you going to refund their deposit?
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To answer my own questions, I pulled and read the public filings Van's Aircraft made in the Oregon Bankruptcy Court. I'm attaching these documents because they are public record, they are the words of Van's Aircraft, and I believe everyone is entitled to full transparency. After reading these I'm feeling a bit more comfortable about the situation.

If you want the summary, you should start with the "Declaration of Clyde Hamstreet". Basically, according to Van's filings, customers with unshipped orders will be offered new pricing (as they mentioned in their announcement). What they don't mention on the website, but what is contained in the filings, is that if you don't accept the new terms by late January then they will cancel your order and you will become an unsecured creditor of the bankruptcy estate. Whether you get any portion of your deposit refunded depends on the plan of reorganization and available funds.

The good news is that since October they have been putting all customer deposits in trust in a segregated bank account and intend to continue doing this going forward. (Previous deposits were used in the business and have been spent already.) So customers paying the additional amounts will be much better protected than they were prepetition.

The even better news is that Dick VanGrunsven and his wife have offered the company a $6M debtor in possession revolving line of credit to support operations during reorganization. This is in addition to over $6M he has already put into the company over the last several years. He has offered favorable terms (unlike many DIP lenders, and I should know, I'm in the business), that make it easier for the company to successfully emerge from bankruptcy. When a shareholder is willing to risk their money like that, it says a lot about their faith in the reorganization plan.

The rest of the filings give information on the projected cash flows and budgets of the company (with interesting insights on what kind of business they are doing). They also give a list of the largest creditors and they amounts they are owed (Lycoming being one of the biggest--I would be interested to know what that is about).
 

Attachments

  • Voluntary Petition.pdf
    989 KB · Views: 1,744
  • Corporate Ownership Statement.pdf
    127.4 KB · Views: 1,203
  • Declaration of Clyde Hamstreet.pdf
    384.3 KB · Views: 1,231
  • Motion to approve DIP financing.pdf
    1.8 MB · Views: 1,258
  • Motion to hold customer post-petition desposits in trust.pdf
    193.9 KB · Views: 1,144
  • Notice of preliminary hearing on motion to use cash collateral.pdf
    1.3 MB · Views: 1,148
  • Motion to reject customer contracts unless new terms agreed (redacted).pdf
    187.5 KB · Views: 282
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rv8ch said:
What I have seen during these transitions is that the customers usually come out fine. Anyone that is owed money - not so much. Even prepayments for services were honored by telecom companies, so I hope the Van's process protects customer deposits.
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Usually that's how it plays out. a company that doesn't want to pay anyone usually files under Chapter 13 so this hopefully is a sign they'll come out stronger in the end and only their suppliers will lose money, not the customers.
 
Work the plan

To all the folks at VANS,

Sometimes bad things happen to good people.

You have excellent airplane kits that bring much joy!

Restructure and come back even BETTER!

And know that your customers want you to succeed!

Lastly, thank you for shipping the needed parts for our club’s plane quickly that arrived today!
 
bmellis11 said:
To answer my own questions, I pulled and read the public filings Van's Aircraft made in the Oregon Bankruptcy Court. I'm attaching these documents because they are public record, they are the words of Van's Aircraft, and I believe everyone is entitled to full transparency.
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Thank you for this! It's a wealth of information, and furthermore, it's fascinating!
 
Thank you for posting the files… I read most of them. Very informative. While I have no experience in business or this matter, I feel slightly more at ease seeing some sort of plan and history laid out in those documents.

Patiently waiting… Jacob
 
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Going through the now publicly available numbers…
At face value this genuinely looks like a business that just lost sight of the details through Covid - then got whacked with a tail event (maybe 2)
Whether it was a change in management or a loss of corporate knowledge, self inflicted or not-
It’s clear that even the largest creditor (lycoming at 500k or so) is only a tiny percentage of their 50+mm revenue. So they were clearly keeping up with cash flow and paying their suppliers right up until they had to set aside 5m for the LCP remediation due to 1800 customers requesting new parts (regardless of whether the engineering analysis required it or not - not arguing about the merit of this either way - just paraphrasing the petition)

As confronting as this appears at the moment, I can see a way forward from here. IMHO, nobody has acted in bad faith and there’s a great business here to be saved. RVs are just going to cost a bit more, which is probably overdue.

There’s a thread about slings v RV10s running. Does it make any sense to anyone that an RV10 is cheaper to build than a sling TSi?

Anyway… I’m sure I speak for everyone wishing the best possible outcome for all of those impacted by this. Especially the employees and Van himself. Not the retirement he had in mind I’m sure.
 
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No conjecture needed.
Just wait for the court to determine the fate of creditors in the line to get repaid after reorganization is approved.

No more questions about where deposits are but maybe if one doesn’t agree to new terms by 1/15/2024 then the frozen funds for courts decision.

I’m no lawyer but the public records are an interesting read
 
Remember that the amount Lycoming are owed only equates to 20 or so engines. I imagine they run a somewhat tighter ship and when product with a unit price like that isn't paid for you stop shipping for that customer pretty quickly and the terms become cash upfront.

Lycoming aren't going to take a haircut. They're the largest creditor and can probably kill the restructure in the bankruptcy court if they want to. The likely scenario for those with an engine deposit down is that their price increase will equate to paying their deposit over again (because Van's have burned it) plus a share of what Lycoming are owed (the ~600k divided by the number of engines they took deposits for).

What I don't know and would like someone with a better understanding of Chapter 11 to tell me is, when the court asks the creditors to vote on accepting the terms, is it one vote per creditor or proportional according to dollars owed? I'm assuming the latter.
 
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Many of us are certainly at a loss for words. I’m pretty sure this is the hardest decision Van has ever made. He is certainly a man of very high integrity, and I’m also pretty sure he is doing as much as possible to take care of the business, the employees, and the customers/creditors. Unfortunately, that is going to take time, but he also committed to more regular communication. Let’s try to give that time to play out without any more speculation.

Vic
 
Guys and Gals relax.... this is a good thing.... This is what companies do to get protection from creditors, get out financial issues to come out of Chapter 11. "Reorganization" was needed. It is not Chapt 13.

Now to my fellow RV builders... I am sorry the issue has effect you and your project. I am pre LCP, but I can imagine how I'd feel. I know this may mean, delay, rebuilding sections of your project or starting fresh. I want to tell you don't give up. It is worth it. I wish all of you well, don't stress, it will not help add one day to your life.

The basics of Van's Aircraft business and their product are solid. There is no issue I see except prices will go up (to match the crazy inflation in the last 3 years). Some contemporary airframe kits by other manufactures start at $75,000 (no engine, prop, avionics, paint, etc of course). An RV kit even after price adjustment are still a bargain, a fraction of total cost after Engine, Prop, Avionics, eetc..

I have seen this issue with major Corporations. They run it like they did in the early days. As the company grows they lose track, do business as usual. One major successful airline today, once had a secretary making multi million dollar aircraft parts orders with janitorial supplies, like she did when the airline started with a handful of airplanes, not 100's flying world wide 20 years later.

The last point is Van's Aircraft is in business. Mr. & Mrs. VanGrunsven are well and investing personal funds, because they care. The morale of the staff is good. The support by the community, although shaken, is strong. This is pretty amazing in todays age. I'm happy to hear this solution for my fellow RV builders.... it is not a great situation, but this is the best way out and will work, given a little time. Keep building and all the best wishes, Happy Holiday, Christmas and New Year to VAF Forum... :)
 
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Anyone that had dealt with lcp or vans in the last while saw this coming.

No surprise and the deposit “escrow” is one good thing to come out of this.

Interesting to hear how they rolled those funds into business expenses like interest free loans.
 
Yes - the $600k will represent product that has shipped but not been paid for. As I said, about 20 or so engines which is about where I'd expect Lycoming to let things run to before putting a stop on shipping.

There's a theoretical future liability for all the future engines Van's has ordered on behalf of customers and burned the deposits for. I don't see this figuring much in the settlement though because (a) Lycoming has a long order book and can easily re-allocate them elsewhere if it doesn't like the Chapter 11 deal, (b) Van's will offload this problem to customers ("pay whatever it costs us to resolve or lose your deposit"), and (c) the burned deposits represent a large number of individual creditors for much smaller amounts, and that large number of smaller creditors are not well placed to influence how things go from here.

There are certain truths in any bankruptcy, Chapter 11 or otherwise. Emergency lenders always get paid in full, restructuring experts always get paid in full, lawyers always get paid in full, major creditors get a fair chunk of what they're owed. Everyone else gets pennies on the dollar.
 
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vic syracuse said:
Many of us are certainly at a loss for words. I’m pretty sure this is the hardest decision Van has ever made. He is certainly a man of very high integrity, and I’m also pretty sure he is doing as much as possible to take care of the business, the employees, and the customers/creditors. Unfortunately, that is going to take time, but he also committed to more regular communication. Let’s try to give that time to play out without any more speculation.

Vic
Click to expand...

Not much left to speculate about left except by what multiplier kit prices are increasing. All the relevant information is in the open in public domain...
 
BTG1996 said:
This 100x....I would edit to be private equity devil.
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Or financing from overseas...

A lot of kit builders are going to find out that their kits will cost a fair bit more than they had planned. That sucks, yes, but part of the incredible privilege of airplane ownership is sometimes having to shell out more money unexpectedly. Any of our engines could start making metal tomorrow, an annual could uncover expensive corrosion... if I didn't want to have to worry about that, I'd be renting a more-boring airplane. But where's the fun in that?

Personally, I have an outstanding parts order (around $1k, so not much compared to a whole kit, but not small either). It sounds like I'll have to wait a bit longer, and I'll probably have to pay a bit more before it ships. But I'll get my parts eventually. More importantly, 10 years from now, I'll still be able to order parts - and they'll ship from Aurora and not Zhenjiang.
 
j4cbo said:
Or financing from overseas...

More importantly, 10 years from now, I'll still be able to order parts - and they'll ship from Aurora and not Zhenjiang.
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Another great point. Spend any time on the COPA forum and you'll see how terrible that is for owners....and they get zero communication. I have as much respect for Van for going on video as I do him stepping up with a $12M loan. Having the founder this engaged after he's exited the business is unreal.

All that says, this does suck as I'm sure most have budget spreadsheets that will now have to be re-tooled with possible project delays....and it will likely cost everyone more than we'd like, but I have a feeling we'll look back in 10 years and things will be in much better shape than we would have thought.

Good luck to all.
 
I couldn't help to think when reading through the list of 20 largest creditors that when #20 was around $26k there are probably customers who have paid more than $26k in deposits that should have been on that list...
 
dstates said:
I couldn't help to think when reading through the list of 20 largest creditors that when #20 was around $26k there are probably customers who have paid more than $26k in deposits that should have been on that list...
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I thought the same. But if you read more, there’s talk about finding out if customers with deposits want to agree to new price/contract or have funds frozen for courts decision( I could not understand exactly). The date I read is by or after 1/15/2024. A lot to digest in all the lawyer talk and what it really means.
 
Well, here we are. I don't think anybody is really surprised by this, or at least they shouldn't be.

I've been pondering whether I have anything to add to this conversation, and ultimately decided that yeah, I have a few thoughts.

First of all, my heart goes out to everybody caught up in this mess. It's a bitter pill to swallow to be halfway through your dream project and then find out that you're going to have to choke down product delays, maybe lost deposits, and certainly price increases on stuff you had already contracted to buy.

But you know what? At the end of the day, it would have been a lot worse if the company had just gone under. If they had gone completely belly up, that would have been the end of the project, game over. People would have been left looking at a set of wings with no way to get a fuselage, or a almost complete airframe, sitting for who knows how long while builders scrambled to find a source for engine mounts or landing gear or whatever. It would have also orphaned an entire fleet, at least until somebody else stepped in. It would have been the end of replacement parts for flap wing-dings or OshKosh storm induced rudder oopses.

People forget that Clyde Cessna went broke. When the time was right, it was his nephew Duane Wallace that took the brand out of mothballs, re-invented it, and made it a viable concern going forward. Pretty much the same thing happened with Beech. Walter would have run them into the dirt if Olive Anne hadn't kept him under control. The lesson there is that sometimes airplane guys aren't the best ones to run airplane companies.

In my mind, thats what we have here. It may look different going forward, but Vans is going to continue to exist as a company, parts will still be produced, and the product is still viable.

I'm also thankful that Dick & Diane V are stepping in to support them with personal funds, which is something I doubt very few 80+ year old retirees would be willing to do. This act of faith in the company says a lot about them personally and about his faith in the company. It also will likely prevent one of the outcomes everybody was so fearful of; a sale of assets to Chinese investors.

Finally, I know that people who have made deposits and have been seemingly stonewalled on information about their status for months are pi$$ed. I get it. It would be easy to go on a tirade about the unfairness of it all. I'd like to thank Doug for setting the tone here on VAF and everybody else for keeping it civil.
 
Desert Rat said:
Well, here we are. I don't think anybody is really surprised by this, or at least they shouldn't be.

I've been pondering whether I have anything to add to this conversation, and ultimately decided that yeah, I have a few thoughts....
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Well said.
 
2theskyy said:
I thought the same. But if you read more, there’s talk about finding out if customers with deposits want to agree to new price/contract or have funds frozen for courts decision( I could not understand exactly). The date I read is by or after 1/15/2024. A lot to digest in all the lawyer talk and what it really means.
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Lawyer here, though this isn’t legal advice. Also, I am not a bankruptcy lawyer, but work tangentially to it, and had to study it in law school. If a customer doesn’t accept the new pricing, their order will be “rejected”, which means that they will have a claim for what they paid. This claim will be unsecured, which means that the other classes of creditors— the secured creditors (i.e., they have a lien), unpaid wages, the reorganization consultant, attorneys, certain trade creditors, the post bankruptcy lender, post filing claims, and taxes— will take priority over those unsecured claims. There will be a plan of reorganization proposed that, once approved, will take the company out of bankruptcy. The plan will provide the payment amount and terms for each class of creditors. The creditors will have a right to vote to approve or reject the plan, but the court will have power to override the vote and approve the plan if it finds it fair and equitable.

Edited to add: unsecured creditors rarely, if ever, get paid for their full claim. Sometimes they just get pennies on the dollar. The amount unsecured creditors will get here is purely speculation at this point and will depend on a lot of factors. Though if you do accept the new pricing and avoid the rejection route then you will get full credit for past payments (according to the currently proposed terms).
 
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Lots of supporting words I can see on this thread. I think we all love this hobby and appreciate the work Vans has been doing for the last 50 years. This is far beyond kit prices and money loss.

How about we start a crowdfunding campaign to help out Van's business?

I would pitch in a 1000 bucks today.
 
2theskyy said:
I thought the same. But if you read more, there’s talk about finding out if customers with deposits want to agree to new price/contract or have funds frozen for courts decision( I could not understand exactly). The date I read is by or after 1/15/2024. A lot to digest in all the lawyer talk and what it really means.
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If you do not accept the new terms by Jan 15th your contract is simply cancelled, that is if the court approves Van's application to be allowed to reject contracts like this. The application makes a fairly compelling case that such power to reject is necessary to keep the company in business.

It is not a case of 'your funds being frozen'. 'Your funds' do not exist, Van's has spent them.

If your contract were cancelled as outlined above, you simply become a minor unsecured creditor asking for their money back in the bankruptcy process. Because they are secured and/or protected by the provisions of Chapter 11, Van will get his $12m back, Clyde the restructurer will get paid in full, the lawyers will get paid in full, the staff get paid, the suppliers get paid and all the business creditors that Van's needs to keep onside will get paid..... all before you see a cent.

You need to understand what the proposition is here. It's basically agree to the new terms or lose your deposit. If they dig their heels in and demand their money back, minor unsecured creditors that are not individually important to the future of the business typically receive nothing.
 
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I’m going to guess you are going to be seeing a bunch of second hand kits come to the market. Prices can only increase so much before it isn’t practical anymore to build. And I think we are reaching that point to several people maybe including myself on my 3rd rv build.
 
bmellis11 said:
Edited to add: unsecured creditors rarely, if ever, get paid for their full claim. Sometimes they just get pennies on the dollar. The amount unsecured creditors will get here is purely speculation at this point and will depend on a lot of factors. Though if you do accept the new pricing and avoid the rejection route then you will get full credit for past payments (according to the currently proposed terms).
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Exactly. If you have a deposit down for a kit but make a decision to abandon your build, you are almost certainly better off accepting the new terms and then selling the kit on compared to declining the new terms and asking for your deposit back.

Someone out there contemplating an order might be much happier doing business 1:1 and getting an unopened kit for cash on collection compared to the risk of sending money to Van's. You might even get full retail for it.
 
bmellis11 said:
....The good news is that since October they have been putting all customer deposits in trust in a segregated bank account and intend to continue doing this going forward. (Previous deposits were used in the business and have been spent already.) So customers paying the additional amounts will be much better protected than they were prepetition....
Click to expand...

Are these customers in a different class than the earlier unsecured creditors? Or will these funds become part of one large bucket of available money?

Thanks,
Dave
 
The list in the petition of all of our names doesn't seem to have everyone. A few of us who are waiting on backorder parts from "delivered" kits and have engine deposits from over a year ago aren't there. Guess we're in no mans land for now.
 
Ch 11 is a complex process that can take years to fully come out of and requires the expenditure of millions on legal and finance fees. That cash comes from somewhere unfortunately and as someone else pointed out - those industries make sure they get paid first and the invoices will roll in from lawyers and consultants containing billable hours and need to get paid.

I'll never forget the one bill that rolled in from a merger advisor from large Wall Street banking firm - 80k plus for 2 days of work...the guy charged us for his first class ticket to/from NY and all 5 hours on the flight to/from NY for his time at $800/hour. Then he presented us with a contract that demanded a $1 million "success fee". I just about lost it.

It should be noted that a filing for ch 11 does not preclude conversion to 7 if agreements cannot be made to satisfy the debtors or objections to the reorg are upheld by the court.

One question I have is there going to be an unsecured creditors committee? If so it should include customer representative class - one for kits, one for engines, one for props maybe. I think it would be in Vans best interest to establish a unsecured creditors committee of committed repeat customers who will volunteer their time to serve to ensure that the customers interests are represented.
 
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Blue or Red pill?

I'm a newby. Just began Empennage assembly for my RV-14. Had to abandon the RV-6 project because Vans was not delivering parts.
So... I have a $6000 empenage kit plus about $10,000 in deposits for wing and fuselage.
My original budget (pre-covid) was about $100K. Post covid, the pricing changed it to $140K. More increases are coming that are destroying my budget.
Do I quit and take the $16K loss now or go all in with another $140K+ to finish the project and hope I can at least sell later and recoup some.
Vans was supposed to be low-budget. This is no longer the case.
There are other kit makers out there to consider. Not as established as Vans.
Sigh... This is going to be a tough month to contemplate Blue or Red pill.
 
David Paule said:
Are these customers in a different class than the earlier unsecured creditors? Or will these funds become part of one large bucket of available money?

Thanks,
Dave
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I was wondering the same thing. I think it depends on what the plan of reorganization is and whether the funds were truly held in trust (which I think is unlikely because the customer never bargained to have it held in trust) or were just funds that Van’s decided it wasn’t going to touch for other purposes.
 
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If nothing else convinces the VAF community of the value of VAF Forums it should be this thread. I know Doug doesn’t like it for users to hawk the “voluntary contribution” need that this community forum is based on but without this forum we would not have the information we need to follow the current situation at Vans Aircraft.

Like Vans Aircraft, Doug and his family has financial needs that demand a solid revenue stream. There are way too many “free riders” who need to step up and contribute. We love our RVs and have a vested interest in seeing Vans succeed as a “going concern.” Likewise we have a vested interests in keeping the free flow of information that only VAF provides. Let’s keep Doug financially stable too!
 
After watching the video, I remain hopeful that Van's Aircraft will survive this. There is strong dedication to achieving that result and I believe this company and this community can make it happen.
 
I Stand with Van’s

I am heartened to wake up this morning and see so many notes and postings of support for Van, Van’s, and the community here on VAF and on other forums. Yes, there are those who are disappointed and angry, but this is the real world - thing like this happen. People in many parts of the world don’t know if they will wake up the next morning to find a war going on in their street.

When I was a junior in college, studying to be an aeronautical engineer so that I could go to work for Bellanca just a hundred miles up the highway, I read one morning that they had declared bankruptcy - and I was crushed. My entire future had just gone down the drain. I had no idea what I would do. Little did I know that (a) this was just part of the ongoing process for aviation companies - boom, bust, boom, bust… and (b) it forced me to look up from my desk and see a posting on the wall that NASA was looking for some kind of interns down in Houston. We live in a world full of opportunities, and the best thing is that we get to wake up each morning to decide which of those we can pursue.

I understand the angst, anger, and personal uncertainty that comes from something this disrupting. But here’s the thing - if you (we) have even seriously contemplated buying an airplane or an airplane kit, then you (we) are in a totally different financial class than someone standing at a punch press making parts, or filling little paper bags with nuts, bolts and rivets - or building crates to ship all those parts to the folks that can afford to pursue the dream of flight. Yes, I understand that as a customer, you (we) could be angry right now - but don’t forget to lift your head up and look at the big picture. There are more than a hundred folks in Aurora this morning that are working hard to help dig out, and they don’t know their own future. Think about them - they had NO part in the decisions or economic realities that got to the company to this point - they just show up for work and do their best so they can put a roof over their heads and food in their family’s mouths. And this is the holiday season.

I stand with Van’s (as I stand with all the small businesses that are part of the homebuilt community) - and I stand with the many good people at Van’s, many of whom I know and call friends.

We don’t know the details of what the future looks like, but I bet it will include Van’s designs, and people building Van’s designs. Good people find a way.

Paul
 
Desert Rat said:
...I know that people who have made deposits and have been seemingly stonewalled on information about their status for months are pi$$ed....
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Actually, I'm not upset. I'm fortunate in that I got my empennage kit in October so I have something to work on and I'm enjoying it.

But, I AM curious to see what Vans does with my RV-14 fuselage kit. I made the "final payment" in August. The crating window was October. It will be interesting to see if I'm asked to make another "final payment" before they ship it.

I also have deposits on both the finishing kit and the engine. It appears I'll be paying more for both of those orders and that's fine with me.

I also have a wing kit with laser cut parts. I'm guessing I'll be paying to get many of those replaced as well.

The bottom line is this airplane was always going to cost a ton of money. I wouldn't have started this project if an extra $50k would have shut me down.
 
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The outcome of this will hopefully be positive for VANs and for the folks working hard there to secure VANs future operation. Best wishes to everyone involved.

I have to admit that we are deeply unsettled, as we have paid deposits in the tidy five-figure range for engine and propeller. If these deposits were eaten up, our construction project at the club will be in serious jeopardy. I don't think we can easily cope with the possible loss of such an amount. Fingers crossed things will turn out good at the end.
 
bmellis11 said:
I was wondering the same thing. I think it depends on what the plan of reorganization is and whether the funds were truly held in trust (which I think is unlikely because the customer never bargained to have it held in trust) or were just funds that Van’s decided it wasn’t going to touch for other purposes.
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Certainly the latter - Van's just decided to do it - but they are looking to formalise it in their Precautionary Motion (to hold customer deposits in separate account etc) as part of the Chapter 11 proceedings.

It's all in the documents and makes it clear that deposits received after October 6th are ringfenced in a separate bank account and remain customer property which they undertake to return on demand at any time. Only when Van's notify a customer that their order is actually going into production will funds be released from that bank account into Van's general cashflow.

Some of the more amusing lines in that document include "notices were inadvertently sent to customers requesting final payments for kits that were not yet ready to be delivered" and "it is the debtor's sound business judgement".
 
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