QB Factory is gone....

QB Factory is gone....[ed. Actually it isn't. dr]

[ed. Factory not really gone (go to this link for info). dr]


First, I'm not trying to start ANY rumor. I am just trying to share what I know becuase this isn't widely known.

I ordered a QB fuse from Vans in early December and according to the website their expected QB ship time was estimated to be a max of three months. Disappointing, but that's just part of the rules. No problem.

My scheduled date has now been pushed into April. Again - not the greatest of news.

Just last week, a buddy of mine ordered his QB fuse. He got an unusually long lead time too. He was told the QB factory was being "relocated" and that's why the lead times are extended.

I thought I'd do a little more digging into the rumor and I visited the factory website hoping to get an update on the move.

www.bonanzametalcrafters.com

Bonanza Metalcrafter's site is gone.

So now you can see the root of my concern.

I just called Vans and got the update. Bonanza Metalcrafters is no longer in business. They closed their doors in Nov and terminated all of their employees.

Apparently their management is opening another company in a different location. Currently they're in the process of re-tooling their facility and trying to hire some new employees. (God, I hope they know how to use a rivet gun and buck rivets correctly!)

Needless to say, I'm very concerned.

It looks like I'm going to get one of the first QB fuses off the newly tooled line. And I'm going to get one of the first fuses a new employee has ever seen/assembled/riveted.

If you're thinking of getting a QB in the next couple of months. You should probably wait. You're going to have to wait anyway and might as well let these guys get some rivets under their belt first.

Just FYI......

Phil

I know a couple of years ago they tried working with hpa, who made F1's for Mark Frederick. For whatever reason that didn't work out, but I remember the rumors being they were looking for a second source.

What I don't understand is with the degree of prefab now in the kits why can't they find some economically depressed town and set up a facility here in the US? Of course it would be more expensive, but by how much...?

rocketbob said:

I know a couple of years ago they tried working with hpa, who made F1's for Mark Frederick. For whatever reason that didn't work out, but I remember the rumors being they were looking for a second source.

What I don't understand is with the degree of prefab now in the kits why can't they find some economically depressed town and set up a facility here in the US? Of course it would be more expensive, but by how much...?

Click to expand...

Like maybe Kerrville, TX, Vero Beach, FL or Independence, KS? They already know how to buck rivets...
Mike

minimum wage

When you get Americans to work for $1 - $2 /hr then they will relocate to a US city. Unfortunately there is no substitute for third world cheap labor. In my industry (Wood products manufacturing) the Chinese pay their employees for one month less than what my guys earn in one day. Luckily they don't make custom stuff so my customers still have to deal with me

You might be surprised...

Before retiring I spent a lot of time in the Philippines and had a number of employees based there (also many other countries). All Filipino employees made a small fraction of their US counterparts. In a small mfg company wages would be somewhere between $100 to $200 per month more likely in the middle of that. And the burden rate was also low (benefits mainly).

Its sad really, no way the US mfg sector can compete on price. See this link if you want to be shocked at wages... http://www.worldsalaries.org/philippines.shtml

Rough numbers, expect up to a 10X increase in the labor content (not insignificant on a airplane) costs - offset by reduced freight of course. Then add back in some likely "incentive" (tax almost certainly - but also low cost utilities, land, facilities, etc...) to locate there that you could not get in most US locations. Environmental compliance would certainly cost more. I also would like to see it here, but it would not be a trivial increase.

Glad I got my QB a while ago... and while I understand the process and numbers above, don't shoot the messenger - I hate the way it works out for american workers and wish we could change it.

rocketbob said:

What I don't understand is with the degree of prefab now in the kits why can't they find some economically depressed town and set up a facility here in the US? Of course it would be more expensive, but by how much...?

Click to expand...

Phil said:

If you're thinking of getting a QB in the next couple of months. You should probably wait. You're going to have to wait anyway and might as well let these guys get some rivets under their belt first.

Just FYI......

Phil

Click to expand...

The standard kits are so highly refined these days I have to wonder about the necessity of the QB kits' existence............

Keep in mind the airframe (standard kit) is only about 1/2 of the total project time investment.

Hmmm

A friend ordered his wing kit and a QB Fuse in mid December. Partain delivered both last week. He was originally told 3 months for the QB Fuse then Vans called him up and said they were going to ship both of them together? That was the 2nd week of January. They must have had a cancellation or something and had one in stock.

The number of homebuilt suppliers that do offshore construction and where they go is quite interesting.

The Bearhawks kit construction facility is in Mexico.
Pulsar has moved to El Salvador
Before Murphy virtually closed up, their quickbuild shop was in El Salvador as well.
Doesn't Steve Saint have a setup with an indian tribe in Equador where they take slow build RV-10s and bring them to the quickbuild status?

Maybe this would be a nice retirement oportunity for some enterprising RVer. Move to some tropical paradise (with low wages). Open up a quickbuild factory, and spend the rest of your years helping people get closer to creating their dream planes.

Standard kits

Sam Buchanan said:

The standard kits are so highly refined these days I have to wonder about the necessity of the QB kits' existence............

Keep in mind the airframe (standard kit) is only about 1/2 of the total project time investment.

Click to expand...

Sam's right. I've found that I can build a standard kit airframe in about the same time as the lead time for the QB. Maybe less. Total calendar time on my '8 was about 10 months for tail, wings, and fuse.

(Nope, I'm not retired. I do typically put in 1-2 hours a day and maybe 8 on the weekend. And yes I still have some time to fly)

mcjon77 said:

Maybe this would be a nice retirement oportunity for some enterprising RVer. Move to some tropical paradise (with low wages). Open up a quickbuild factory, and spend the rest of your years helping people get closer to creating their dream planes.

Click to expand...

I was under the impression that is what Bonanza Metal Crafters basically was....

Someone correct me if I'm wrong but, the early quick builds were pretty rough. They passed QC, but they looked pretty rough. I hope the learning curve is not like it was in the early days.

It is too bad that we are all in such a hurry for our toys. This off shore sourcing out has only one good point cheap labour. But look at the fix this country is in because it has given so many jobs away to other countries and forced our own to be unemployed.

QB Factory NOT gone....just moved.

...from an 'informed source' regarding the QB facility used by Van's


b,
dr

Geico266 said:

Someone correct me if I'm wrong but, the early quick builds were pretty rough. They passed QC, but they looked pretty rough. I hope the learning curve is not like it was in the early days.

Click to expand...

The construction quality of QB kits have generally be considered by most RV builders to be higher than what a typical first time builder can do. Far from being rough, but they are also not custom built show plane quality either...it is a production line process. Some of the early ones (15 years ago) where not up the quality that has been typical for many years.

mcjon77 said:

The number of homebuilt suppliers that do offshore construction and where they go is quite interesting.

The Bearhawks kit construction facility is in Mexico.
Pulsar has moved to El Salvador
Before Murphy virtually closed up, their quickbuild shop was in El Salvador as well.
Doesn't Steve Saint have a setup with an indian tribe in Equador where they take slow build RV-10s and bring them to the quickbuild status?

Maybe this would be a nice retirement oportunity for some enterprising RVer. Move to some tropical paradise (with low wages). Open up a quickbuild factory, and spend the rest of your years helping people get closer to creating their dream planes.

Click to expand...

Lancair kits (except for the evolution (i'm not sure where the molds are for that airframe) are molded in the Philippines.

I don't know Doug, but that letter seems more like PR spin than something that makes much sense. Saying they're not REALLY gone is kinda like saying your not REALLY pregnant.

I can't help but think something went terribly wrong with Vans/Bonanza/Bonanza2's plans. Otherwise there wouldn't be a huge gap in Vans supply chain. Vans can't be happy about it either.

If it walks like and duck and talks like a duck it must be a.......... Aflac commerical.

[?]

the explanation letter doug gave makes sense to me, especially considering it is in a foreign country. and a 3rd world one at that

moving

I cannot imagine the headache the company must be going through... Inventory, tools, paperwork etc... not to mention the actual moving and set up of the new shop. No matter what, one of the first rules of combat is the initial plan never survives unchanged with first contact. I cannot imagine a building that is perfect and 100% ready for the new customer to move into. I wish them the best, and I forecast that even if they have some delays, the product will be back in regular production soon and even though nobody puts out a perfect product... they will do much better than the first-timer. Also the tribal knowledge associated with building anything is still preserved with the employees coming back to work instead of new employees. I wish them the best... and If I had my way about it.. I'd sneak them a -3 kit and say try this one.... lets make the fuselage qb as well..
Best
Brian Wallis

I'd move too!

Considering what the factory went through during the flood last year I can certainly see why they would want the factory in a different location if only for that reason. After being in business for 30 years here in the US and dealing with government about small business I don't see anything unusual about their situation. I have seen stranger things happen right here. It looks to me like the factory just found a way to stay compliant and maybe get a new facility with government assistance. I don't have a dog in the fight because I have all my kits and they were slow build but I trust Van enough that I would not hesitate to order a QB kit today if I needed one.

Another thing to consider...

is import / export rules and customs fees.

Here in the US, we have set up specific areas known as "Foreign Trade Zones". For the US, this allows US manufacturers to have goods brought into this country, placed in the warehouse in the Foreign Trade Zone (ideally, located within a short drive down the road), and no "Duty" is paid until the goods are released from the warehouse and make their way to the "domestic" manufacturing site. Companies that consume a large volume of foreign parts benefit by not having to pay US Customs Duty fees when the parts arrive on US shores and sit in their own warehouse. This is just one execution segment of the "just-in-time" manufacturing concept.

So, there may be a similar set-up in the Philippines. There could be a significant cost advantage to Van's...he sends parts over, he gets the same parts back...in a more finished form, and potentially, only the labor aspect of the arrangement is charged an export / import duty fee. Only Van can say for sure, but that's my take on DR's post.

Renegotiation of labor contracts

Found this link that may explain the need to negotiate labor contracts and also the relocation stategy:

http://www.kilusangmayouno.org/protesting-aircraft-builders-join-wage-hike-action

Their website still 'off air'

regards.

Levrie said:

Found this link that may explain the need to negotiate labor contracts and also the relocation stategy:

http://www.kilusangmayouno.org/protesting-aircraft-builders-join-wage-hike-action

Their website still 'off air'

regards.

Click to expand...

Appears the info that Doug posted from a "well informed" person is bogus. It certainly appears that they are having labor issues.

I found several articles yesterday that mentioned labor strikes and Bonanza too. This specific one is new to me though.

Looks like an old article

Levrie said:

Found this link that may explain the need to negotiate labor contracts and also the relocation stategy:

http://www.kilusangmayouno.org/protesting-aircraft-builders-join-wage-hike-action

Their website still 'off air'

regards.

Click to expand...

The article from that web site was written 2007/10/14. Not sure if the information still applies as Van's has been getting QBs.

Van's isn't really know for their "PR spin". Honesty, trustworthy and quality are words I would associate with with Vans. Although Doug didn't say who the "well informed" person was, what they said is consistent with my relationship with Van's.

They're also known for not fully communicating the extent of problems when they really do exist. Remember the A-model tip overs?

If the dismantling of the factory or the relocation to a new and improved site was expected, don't you think we would have heard about the great news in the RVator at least? Better quality product, faster turn around and better processes are all great news and RVator worthy.

I just wish Vans would make a public statement and come clean about the entire situation. Instead they've chosen to speak anonymously and through a third party. If all was well, they'd be speaking on their own behalf. - just food for thought.



On a side note:

Please don't think this is a story I caught wind of and then rushed to my computer to be the first to share the latest gossip. That couldn't be any further from the truth. I found out about this a few weeks ago and simply gathered as much information as I possibly could.

When you read my first post and compare it with the note Doug received, you'll see the information I shared was very accurate and not a load of garbage that I just threw out on the table for discussion.

At first I wasn't concerned about the factory relocation at all and I never intended to share the news. But after hearing multiple conflicting stories from 'well informed' people, that's when I grew concerned and decided to share that concern with the group for validation. I have heard at least 6 different explanations and there might be a sliver of truth in all of them. I prefer to keep those stories to myself because the rumor mill is already spinning fast enough.

However I can tell you that none of the stories align and no one could tell me the truth with conviction. That is cause for concern.

One thing we all know for sure and that is the old factory is gone. A new one is in the plans. Hopefully the new Bonanza doesn't move the factory too far, because that will eliminate several of those skilled workers who can't afford the commute to a new location.

Several builders (myself included) have $20,000 - $40,000 orders hanging in the balance and we're counting on Vans ability to work through the issue. Those with open orders deserve to know this is going on. This impacts their projects, time lines, budgets, and potentially the overall quality of the product they are expecting to receive.

At this point, I will leave the thread alone and hopefully it'll roll off the front page. All of the information has been presented and the folks with open orders can do their own research and determine their own level of concern on an individual basis.

I just wanted to make them aware that the QB kit they were expecting may not be the QB kit they receive. Just be cautious and know that things are changing. That's all.


Phil

What about the RV-12?

OK, let me start yet another rumor...

Could it be that they are relocating to a larger facility so they can also build complete, ready to fly, RV-12's? They could assemble them right next to the new, yet to be announced, RV-13.

Phil said:

snip...I just wish Vans would make a public statement and come clean about the entire situation. Instead they've chosen to speak anonymously and through a third party. If all was well, they'd be speaking on their own behalf. - just food for thought....snip

Click to expand...

Phil,

I believe you might have misinturpreted my attempt at humor with the quotes around 'anonymous sources' in my earlier post. The information I posted was emailed to me by Scott Risen, General Manager Van's Aircraft.

I take it at face value and believe Scott 100%. Over the decade or so I've know him I've never had any reason to feel otherwise.

Doug

Which one is PR?

Vans or a self described "Genuine, Militant and Anti-Imperialist Labor Center"? I lived in the third world a while and by Anti-Imperialist by likely mean Anti-American.

BTW, Reads just like the PR from the Boeing IAM strike this last year. At least we don't have $1B tied up in orders....

I wonder how much a 50% raise in workers wages there would affect QB pricing? Just guessing wildley, a 1$ hr increase (probably much more than 50%), on a QB that takes a skilled crew say 600hrs to assemble, raises the price $600/ss. Granted this may be totally naive, but it should give one pause considering the difference between the two economies.

I understand it would be more

But I wonder how much more it would cost to build them here. Say, a factory went up right next to the parts factory. Just about all the transportation costs would be gone. Higher labor will offset this and then some. But people would be put to work here. There must be enviromental benefits for shipping them oversea's, which save money. I am sure Van's has calculated it out, but I wonder how much more it would cost to make here rather than there. BTW, somewhere in or on my fuselage there is going to be a place that says "Made in America."

Randy

stjoesniper said:

But I wonder how much more it would cost to build them here. Say, a factory went up right next to the parts factory. Just about all the transportation costs would be gone. Higher labor will offset this and then some. But people would be put to work here. There must be enviromental benefits for shipping them oversea's, which save money. I am sure Van's has calculated it out, but I wonder how much more it would cost to make here rather than there. BTW, somewhere in or on my fuselage there is going to be a place that says "Made in America."

Randy

Click to expand...

maybe, maybe if you could get people to work for $12 an hour to do the work it'd pencil out.

but our laws (and employees) want benefits, insurance, fica taxes, taxes, taxes, it all adds up. no way they could do it in the USA for even 3x the money.

How about keeping the money in the USA.

http://www.rvbuildersassistance.com

Lets back of the envelop the difference

OK, for assumption purposes lets say:

1. The overseas worker gets paid $2.00 an hour (thats too high)
2. You can hire a quality, stable workforce for $10.00 an hour (you can't)
3. It takes 600 hours to build a QB (took from a post in the thread)

The difference in direct labor = $4800.00

Then you can subtract freight (I can't estimate that - but ocean freight in containers is remarkably inexpensive)

Then ADD:

1. Additional cost of employee benefits
2. Additional cost of indirect labor (manufacturing engineers, plant management, Personnel, environmental, health, etc...) I can't estimate it, but indirect labor hit per unit will be huge on a low volume business model.
3. Additional taxes (I imagine they are built in a Free Trade Zone - sounds like it anyway) - you can't likely get a tax incentive package here. A huge factory could, but not a small one.
4. Additional facilities charges (power, water and the facility are usually heavily susidized)

My prior work experience tells me 1-4 above would cost more per unit than freight.

So, lets say it netted out, how many RV builders would pay $5000.00 more for their kit to be made in america? Thats a extremely high percentage increase for a QB and I bet sales would decline quite a bit and more rv's would be slow builds. You wondered how much and this overly simply estimate says "a lot".

I HATE the answer these formulas provide. But the real answer is in lifestyle. The third world does not enjoy the lifestyle the average american worker enjoys.

I support the sentiment, but the work is not coming back until the standard of living delta converges. Either theirs grows, or ours drops. Sadly both are happening...

Mine is a QB, I guess I will have to calculate the % of american content like new cars have to - but I am glad it was an affordable option. But at this point its more than 50% american sourced given my time in it

stjoesniper said:

But I wonder how much more it would cost to build them here. Say, a factory went up right next to the parts factory. Just about all the transportation costs would be gone. Higher labor will offset this and then some. But people would be put to work here. There must be enviromental benefits for shipping them oversea's, which save money. I am sure Van's has calculated it out, but I wonder how much more it would cost to make here rather than there. BTW, somewhere in or on my fuselage there is going to be a place that says "Made in America."

Randy

Click to expand...

600 Hrs. for a quickbuild!

I have no idea how many hours it takes to make a quickbuild, but for say a team of 2 or 3 people, I would have a hard time believing that it would take 600 man hours to get a kit to the quickbuild stage. I am not talking about hours for one guy who has never built a plane before to get his kit to the quickbuild point. I am talking about people who are doing this day in and day out, know the planes very well, and most importantly are set up with good facilities and the right tools. Half of my work seems to be finding a way to work with what I got, I couldn't imagine having the right tool for the job for just about everything, thats aside from the fact that most of the time, I have NO idea what I am doing anyway. But 600 hours, that is one guy, working by himself, 8-5 with an hour lunchbreak, monday-friday, for 3 months, no holidays. I guess what I am saying is that the more hours it takes to get a plane to quickbuild status, the more sense it makes to ship it overseas, but if it is less than that, building them here becomes more do-able.

Lets back of the envelop the difference

Theory is great, ask for a quote. If the foreign company is gone then it is gone.

Negate the Difference

OK, maybe a wise @#$% approach, but the way to ensure keeping the $ at home, go slow-build, do the labor yourself, then go spend the savings locally. Seems like the way to go. You can buy an SL-30 for the savings between the slo and fast build.

let me correct that for you...

rwhittier said:

The third world does not enjoy the lifestyle the average american worker enjoys, but can't really afford...

Click to expand...

????????????

Thread drift

This thread has run so far from the original post it is amazing.

Just getting too political

Time to close this, before it really crosses the line.