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Big Kit price Increases Dec 15, 2021

I get the feeling that those that are posting about how evil this is do not work in the manufacturing end of business, its a whole new ball game out there.
I run a small electronic engineering company, I have had simple solid state relays on order for over 5 months, not one has shipped. my supplier normally keeps 50000 in stock, he hasn't had one shipped in six months. the latest I was told was the 20th of december. yesterday that was pushed out at least another month. molex .1in connectors are now showing an aug 2022 date, take a guess why dynon is backed up. microprocessors, good luck, i got lucky and found 50 available in london to keep me going a little longer, they cost me 100% more, but I was able to get them. my overall parts costs are up over 50% this year so far.

I have no idea how vans can keep the price of quick build kits down so much, a 40ft container to the UK that we paid about 8k for last year is closer to 30k now, if you can get one. vans cannot give anybody a estimate on time because their suppliers cannot give them one. my relay supplier talks directly to the manufacture and cannot even get firm date when they will leave the factory.

yes it sucks, but vans, like every one else in the manufacturing business is trying to just stay in business.

bob burns
RV-4 N82RB
 
waiting

waiting to see the first half million-dollar RV-10 posted for sale. you really don't want to have your money in cash these days because you're losing every day.
 
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I will add another begrudging agreement with Vans unfortunate but necessary price hike. I run a business that uses a lot of steel. I went to my primary customer in April and warned them that my cost to purchase their steel was up 80 - 105% over what it had been. I offered them the option to delay their project and see if the prices came down or push on and just pay a lot more. They chose to push forward. The end result is my "widget" price charged to them went from about $47 per widget to $82. My net profit went up about $2 initially, then dropped about $5 when my steel costs jumped up mid-summer. The late fall batch left me with exactly the same profit I had the previous year. Keep in mind, my food, gas, vehicle, and other daily living expenses went up about 9% just like everyone else's so making exactly the same profit as I did last year is really a 9% cut in my spending power while charging my customer 74% more per widget than I did the previous year. The only way I can soften that blow is by working more hours and delivering more widgets. Honestly, I'm impressed that Vans has only raised their prices as much as they did. Unfortunately, my lower spending power now means I'm also in the "throw in the towel" decision stage. I had planned to send in my order next summer after I finished the final "widget" and sell off my machinery. I'm not sure I'll be able to do that now.
 
In all of this, it’s good to remember how the cost of an RV kit stacks up against other homebuilts…

Full quickbuild RV-7 - $47,685
Carbon Cub - $82,500
 
Costs

Vans is not the only ones raising prices. Everything is sky rocketing. For example a 4x4 1/4wall x 20' is $600.00 now. It is crazy. Fuel prices makes everything go up nomatter what it is.
 
But why?

We did some hard negotiating on our bulk aluminum this year (and we purchase sheets on a multi-year contract, to answer another person's question). Because Boeing was not manufacturing at their forecasted levels, we were able take some of that extra supply and keep our aluminum costs lower. That's a good thing, though - because so many other costs have skyrocketed.

Our costs are still rising in terms of labor, materials, and services. I know people wish we could tell them ahead of time whenever a price increase is coming, but truly and honestly I can tell you that the only thing this increase does is stem the losses that've already been occurring due to the realities of today. While I can't see far enough into the future to tell you whether we'll need to raise prices again at some point in the next handful of months, what I can tell you is that it's certainly possible given the direction of the current economic business environment. We'll make those decisions as the situation evolves and we likely won't be able to pre-announce in this situation.

We must remain profitable so we can be here to supply and support our customers, and we're striving to make that work in as efficient and cost-effective a manner as we are able. Our margins are not huge at Van's and the increases we had to put in place this week don't even bring us back to where our margins typically sit. We're doing the best we can to keep prices as low as the economics allow because that's where we came from, too: building cool airplanes on a budget.


But why? Why can’t a post or email go out to notify people of a substantial price increase? Even if it’s just as little as 24 hours, even the start of a business day with a price increase effective at the close of business that same day. You know it’s coming, so a slight notice would be great. I know the world is struggling right now and we are all getting f**#ked, which makes it even more important for us to work together and do even tiny things to help one another.

I am beyond happy that a company like Vans exists, it is giving me the ability to produce my dreams. I can deal with the delays and price increases as I know it’s a must in this climate, but I have to believe a slight notice could be done to help some of us out in this confusing state of ever changing inflation, lead times and budgets. Thank you all so, so much for working hard like you do and please continue to make the product we know and trust. I would simply just ask, please give a small helping hand in the form of a little notice.
 
Looking out the window of my office I see cars lined up for a church run food bank. I am grateful I am not in it.

Hmmm, people queuing in their cars for social welfare. There must be some irony in that statement considering that only the wealthiest 13% of the world's population can afford to own a car ;)
 
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Remember a couple of years ago. You ordered a kit at a fixed price, paid a deposit and took delivery in a relatively short time.

Today you order at a fixed price, pay the deposit and take delivery in up to a year or more later.

In the past, with the short delivery time, low inflation and labor costs stable, any price increases to Vans between the order and delivery were small and either included in the price or adsorbed by them. If they were wrong, the amount would not be a major problem.

With a year or more delivery time for some kits, unpredictable inflation, material costs, labor, shipping and outside suppliers facing the same problems, Vans does not know the cost of a kit until it leaves the door. Based on some of the numbers from others in this thread, the cost increase to Vans could be much larger than the latest price increase.

I could see, sometime in the future, the price including an inflation adjustment clause. Or at least, very frequent price adjustments.

It is a lot less fun to manage these complex financial issues than build great aircraft. I have a lot of confidence Vans can handle it, we just have to learn patience.
 
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Hmmm, people queuing in their cars for social welfare. There must be some irony in that statement considering that only the wealthiest 13% of the world's population can afford to own a car ;)

Owning a car is a hard necessity in much of the USA, and while expensive, it enables the owner to get to work, buy groceries, etc. No car, no job in many places.
 
Airplanes

Owning a car is a hard necessity in much of the USA, and while expensive, it enables the owner to get to work, buy groceries, etc. No car, no job in many places.
And owning an airplane in many parts of the country is a necessity. No airplane, no fun.
 
We can choose to buy a kit or not buy a kit at whatever price. Over 800 million people in the world go to bed hungry. It's not their choice.
 
First post here on VAF:

I ordered all four RV10 kits back in June of 21, and paid the deposits. I understand Vans is just a victim of what is going on on right now. So I will patiently wait and get started when something shows up. (Hopefully early next year?)

Anyone near the GSO area building one? It would be nice to look at someone's work, as I have never built an aircraft.

Mike
 
Price increase

No doubt we will see more price increases going forward. Its not just everything is costing more. Your money is worth less. As a student of history, in Roman times as they shorted the coin of precious metal,the military would stop accepting it as payment. How far are we from that? Vans is in the middle of a expansion replacing a retiring work force,expanding production of both kits and completed 12is's. Preforming more component production in-house in the middle of a pandemic and at the top of a economic bubble. I would hope they scale back a little, focus on kit production to meet existing demand,focus on training new employees.Wait on new model introductions for now.Expanding Too fast at a top of a bubble and unable to survive the impending,inevitable crash that will surely follow would be devastating to general aviation as RV's make up the major portion of exp GA. Another words, Vans survival is paramount to us, The price increases and those to come are small price to pay if there is no Vans going forward.IMHO
R.Hill
 
Increases are expected

Expect some price increases as the price of labor and material increase but I am hoping vans leaders have the capacity to think outside the box themselves or hire enough consultants to do it for them so they can seriously change their processes and/or business models so they can flex and scale. Similar to the prior post, scaling will make or break you. But in Vans case, they have the customer base already out there. Someone would buy out the rights to build parts or the previous models under the vans name or a new name because demand is there. So I'm not as worried if they go belly up so long as my last two kits come in before then.
 
Support for van’s

These are definitely tough times. We need to support Van’s for sure. We need them. What I want to know is how many of the people commenting on this thread have contributed to Delta Romeo? With forum support about 5 percent of the people using the forum I am more worried about loosing the tremendous asset we have that supports the wonderful airplanes we all love. Come on lurkers step up!
 
I get it

We all would love for Van’s to give us a 15 or 30 days heads up. The issue is there suppliers can’t do the same. Every day aluminum prices can change. You order today and Van’s can’t fix the price they receive aluminum at. They need aluminum 90 days or more from today so they need to look at futures pricing. Futures are higher now for aluminum than they have ever been. What’s the price of freight 6 months from now ? Or the labor rates in the US or overseas. If they accept orders based on yesterday prices they might be out of business tomorrow. That would not be good.
 
Donation

These are definitely tough times. We need to support Van’s for sure. We need them. What I want to know is how many of the people commenting on this thread have contributed to Delta Romeo? With forum support about 5 percent of the people using the forum I am more worried about loosing the tremendous asset we have that supports the wonderful airplanes we all love. Come on lurkers step up!

That's why I update my signature. Every year since I started building. 7 years?:D
 
We all would love for Van’s to give us a 15 or 30 days heads up. The issue is there suppliers can’t do the same. Every day aluminum prices can change. You order today and Van’s can’t fix the price they receive aluminum at. They need aluminum 90 days or more from today so they need to look at futures pricing. Futures are higher now for aluminum than they have ever been. What’s the price of freight 6 months from now ? Or the labor rates in the US or overseas. If they accept orders based on yesterday prices they might be out of business tomorrow. That would not be good.

Aluminum has actually been trending down...

I suspect the biggest issue at Vans is with labor cost / productivity. QB price increases are indicative of that IMO.

https://tradingeconomics.com/commodity/aluminum
 
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I say yes... and would be glad to pay up for it provided delivery times improve.

And therein lies the deal-breaker for me. I just retired and have the resources and time to build but the lead time makes it a no-go. Sometimes life just isn't fair....

-Marc
 
We all would love for Van’s to give us a 15 or 30 days heads up. The issue is there suppliers can’t do the same. Every day aluminum prices can change. You order today and Van’s can’t fix the price they receive aluminum at. They need aluminum 90 days or more from today so they need to look at futures pricing. Futures are higher now for aluminum than they have ever been. What’s the price of freight 6 months from now ? Or the labor rates in the US or overseas. If they accept orders based on yesterday prices they might be out of business tomorrow. That would not be good.

Without too much effort, someone at Van's could model the benefit of an early announcement of price increase and the potential orders received. They collect the cash on a down payment to hold the order. Change the terms to make the 25% non refundable for a lock.

I just ordered a tail kit. If I knew a price increase was coming, I'd have locked in the entire kit and risked the down payment.

I'm a little disappointed. But as it turns out, I might just shift away from Van's if a kit or the right plane comes up for sale in the next couple of years. Van's doesn't win on that arrangement.
 
Synergy Air?

And therein lies the deal-breaker for me. I just retired and have the resources and time to build but the lead time makes it a no-go. Sometimes life just isn't fair....

-Marc

What several Synergy Air South customers have done is to convert their QB orders to slow build and then have Synergy build their SB kits to QB levels. Probably a little more expensive, but substantially quicker. In addition, you could customize some (like installing fuel returns and nicer Newton caps in the fuel tanks).

Suggest you reach out to them - https://synergyair.com/
 
Van’s has reportedly added Flyer in Brazil as a second QB manufacturing location. I wonder if shipping to/from Brazil is any different than to/from the Philippines?

Given the current problems in the shipping and logistics industry, I doubt there's any real difference currently. In the future, maybe so, but all shipping seems to be in a perpetual SNAFU situation now ...
 
But as it turns out, I might just shift away from Van's if a kit or the right plane comes up for sale in the next couple of years. Van's doesn't win on that arrangement.


I suspect there will be a number of unfinished kits come on the market a couple of years down the road. There's always a certain percentage of kits that languish in garages and workshops for a while before the owner decides to throw in the towel, either due to the amount of work involved, loss of interest, changing financial circumstances or other factors. Given the number of kits sold during the pandemic era, that percentage virtually guarantees that an atypical number of second-hand kits will eventually be for sale.
 
What several Synergy Air South customers have done is to convert their QB orders to slow build and then have Synergy build their SB kits to QB levels. Probably a little more expensive, but substantially quicker. In addition, you could customize some (like installing fuel returns and nicer Newton caps in the fuel tanks).

Suggest you reach out to them - https://synergyair.com/

Even the slow-build kits are way out there for shipping times. It seems that the current conditions and economy are going to help Vans solve their problems sooner rather than later.

Believe me I want nothing but the best for Vans. They have always been there for support on my RV and that is a huge bonus!

-Marc
 
I suspect there will be a number of unfinished kits come on the market a couple of years down the road. There's always a certain percentage of kits that languish in garages and workshops for a while before the owner decides to throw in the towel, either due to the amount of work involved, loss of interest, changing financial circumstances or other factors. Given the number of kits sold during the pandemic era, that percentage virtually guarantees that an atypical number of second-hand kits will eventually be for sale.

There was a huge wave of enthusiasm for building at the start of Covid. I wonder how many of the kits will be completed before the 4 years time frame. There were empennage kits that took over 1 year to complete where it should take no more than 2 months for someone who is retired. My original build estimate was 4 years and it is still hard to meet this artificial deadline when working a full-time job.
 
Ordered all all kits except avionics and Engine RV12IS last May

I am not in a position to make judgement about what is happening at VANS as I have no idea of the challenges they are facing. I do know when I was considering buying a RV12IS I received 100% positive feedback about the company and how they are around after the sale to support their customers throughout the build. Once the smoke clears I have to believe that excellent customer service will remain as their core value.

I ordered, and paid in full, for the emp, fuse, wings kits last May (15th) and finishing kit in June (paid deposit) and have not received anything yet. According to the order status website ( hasn't been updated since 11/9) my emp. kit is in crating this week and all the other kits are in "Parts being produced" phase. Hopefully someone communicates the status of my kits or least deliver one so I can get started!

When I ordered the lead times for the emp/tail was 4 months, probably be at least 8 months assuming it is delivered in the next month or so. The other kits had 6 month lead times who knows when I get these!

I have read that others that have ordered their emp/tail kit after I did have already received theirs. In hindsight, it was probably a huge mistake paying for most of my kits in full but I knew if I didn't some "emergency" would come up and I would end up spending the money.

If someone from Van's see this posting I would really appreciate any information regarding the status of my order.
Thank you
Ben
 
New paint.

Before and after. I am uber happy how it turned out! Merry Christmas to myself.
 

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Van's should consider building QB kits in Texas. As I understand, Texas has an influx of about a million people (hopefully) looking for a job. And the gov't should provide a financial incentive to help train the new workers so they can provide for themselves.

As far as inflation, in the 80's, if you had a home loan of 10%, you were considered very lucky, and homes were sold with a bonus of assuming your loan.

Kitfox is 2 years backlogged with their kit orders..... be happy you are not building a kitfox. Their kit cost is closer to a 14 than a 7, for a 120 mph rag wing airplane.

Maybe Van's should work through an escrow company where your money could sit secure until the kit is shipped. Then you could refinance your house at 2% (Rocket mortgage) and secure your kit price. The majority voted, and this is what you get, till you vote again.
 
I am not in a position to make judgement about what is happening at VANS as I have no idea of the challenges they are facing. I do know when I was considering buying a RV12IS I received 100% positive feedback about the company and how they are around after the sale to support their customers throughout the build. Once the smoke clears I have to believe that excellent customer service will remain as their core value.

[....]

I complain like many others about the long wait times and lack of transparency, but I want to second this comment. I ordered my empennage kit back before things got really bad, when there was still only 4 month lead time, and although there was 4 months of silence, Van's hit their target crating, shipping and delivery dates to the day which impressed me. And their builder support has been wonderful. I was surprised to find the parts in the kit I received had date stamps spanning 2 years with the latest parts dated the day my kit left the factory!

No matter how frustrated we feel, I'm sure they're trying everything they can to fill orders. Unfilled orders are unrealized income and no company wants to leave money on the table.

Anyone who has tried to buy a big ticket item (appliances, cars, even houses) knows how wacky the markets are now. And anyone who has tried to hire employees knows how tough the labor market is. There isn't a magic bullet that's going to fix everything overnight. It's going to take time. Van's could throw lots of money at the problem and *maybe* find partners willing to give them priority, but who'd be able to afford the kits?
 
Opinions are like a…..well you know, so here’s my smelly one.

I think Vans has historically set a pretty high standard. We all are still somewhat expecting that. The problem is we are in a really odd time with such a globally intertwined supply chain. The way I imagine the scenario went: Vans calls to get a reorder on supplies, bill comes back 40% higher than quoted(if you can get a quote anymore). OH S*#%!!! 2 hour discussion on how to handle this, come to the quick conclusion that it has to be passed on to the customer. This is clearly an over-simplification but there’s not a whole lot that can be done. Things just cost more now. It’s a sad reality. I just finished building my home, which we started early 2020(pre-pandemic) and I watched pretty much every single input cost skyrocket. Thankfully, we pre-purchased a high percentage of materials, and with some stern conversations, were able to control labor costs. However, quality suffered because of said labor issues.

Do I think Vans should have given a heads up? Sure. Am I upset that they didn’t? Not really. Publix didn’t warn me that the price of half and half was going up, it
just did. And, since my wife wants it her coffee, I paid it. I’d also like to add that if $5k increase on an RV10 kit is enough to have you ‘throw in the towel’ you should be thankful you didn’t purchase. In my estimates, I’ll be between 250k-275k when I’m done. If you think that’s high, consider the 150L I saw on barnstormers for $84,900!!!!! I’ll wait for my grin!

As they say….your mileage may vary.
 
Van's should consider building QB kits in Texas. As I understand, Texas has an influx of about a million people (hopefully) looking for a job. And the gov't should provide a financial incentive to help train the new workers so they can provide for themselves.

That's something interesting to think about. Would the quick builders need to be A&P's? Or could they be anyone with the sheet metal skills.

I don't know enough about manufacturing costs to work out if this would be feasible with the cost of labor in the USA. But I would be interested if someone wanted to post an estimate.
 
But why? Why can’t a post or email go out to notify people of a substantial price increase?
Pretend it was your business. Think it through. Due to significant increases in your own costs, you've determined the current kit prices result in losses.
How many kits are you willing to lose money on? If you announce an increase and orders pour in to beat it, how will you allocate the losses on those kits? Entirely out of your own pocket? Or maybe lay someone off or cut healthcare benefits? Or take a loan that increases long term risk to your company's viability?

A viable business must make a profit over what is available from passive investments (e.g. stock market). Otherwise why bother? Running a business is far more hassle then buying an index fund.
 
Revived this 2 year old thread thread

Looking back 2 years … Vans knew they started to get behind the 8 ball. This is probably good news from all that’s come from the factory recently. They’ve had 2 years to keep prices inline with profitability. Unfortunately the primer issue came around along with LCP … . Hopefully it is a “ Cash Flow Issue “ as it was presented and appears to be ….not We are Dead Broke .
 
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