After A Six-Year Dive, Wichita Aviation Industry May Be Looking Up
Wichita, Kan., calls itself the "Air Capital of the World."
But sales of the business jets made there took a nosedive during the recession and have struggled since.
A couple of fresh business ideas are trying to help. One centers on getting more people to travel in small planes. The other is repurposing business jet technology to build a jet fighter for the developing world.
Hard times in Wichita
Wichita’s been through some tough years recentl. And so has Kevin Bell.
"Yeah, I’ve had my ups and downs, so’s aircraft, it’s had its ups and downs," says Bell smoking a Marlboro Red in the front porch of his trailer home on the outskirts of Wichita.
Bell was laid off 6 years ago. He took advanced vocational-technical classes, and put in dozens of applications, but nothing worked.
"My unemployment run out," Bell said. "I’m thinking, 'Crap, now what do I do?'"
Wichita mayor Carl Brewer knows the feeling. A former aviation worker himself, Brewer remembers the day a letter hit his desk at city hall announcing 3,000 aircraft factory layoffs.
"And, you know, I thought, surely that had to be a typo," remembers Brewer. "You made the phone call, and no that’s no typo, and confidentially there’ll be more to follow."
Lots more, according to Jeremy Hill who directs the Center for Economic Development and Business Research at Wichita State University.
"We’ve lost about 16,400 jobs, and that’s the net, not the total," says Hill.
Hill says that during the recession, small business jet customers couldn’t get loans, and sales collapsed. Now money’s flowing and sales are climbing, but, as of this year, Wichita airplane companies are still shedding workers.
"You need to at least have a couple of months when you are having a recovery, before you say you have trough," says Hill. "And we haven’t really had a recovery to say we’ve hit the trough yet."
One solution for Wichita might come a long ways away, both geographically and culturally: New York. In Times Square, where giant woman on enormous screens flash on buildings, a company called Wheels Up is headquartered.
"We found a new market, it’s robust, it’s a great niche," boasts Wheels Up founder Kenny Dichter.
Dichter says Wheels Up makes flying on business planes cheaper, and easier. He says it gives more people a chance to do it. Instead of having to own a plane, or lease a percentage of one, his customers pay a membership fee, and then about $4,000 for every hour they fly.
Dichter’s even rolling out a phone app for booking.
"The amount of travel that we could generate through Wheels App, could be very, very meaningful in terms of kick-starting lines of business in Wichita," claims Dichter.
The line Dichter is talking mainly about is in an enormous old factory on the west side of Wichita where Textron makes Beechcraft King Airs, a two engine turbo prop.
This factory once made jets, too. In fact a few unfinished planes lurk on the far side of the building, waiting to be scavenged for parts. The recession crashed the jet line, so Christi Tannahill, who runs the whole King Air operation, says it was a big deal when Wheels Up put in an order for 105 King Air 350s.
"We know, every year, that we’re going to produce more airplanes than we built before, because we have a large customer such as Kenny, purchasing our airplanes," says Tannahill.
Every engineer’s dream
But the small plane industry isn’t counting on one venerable old plane to tow it out of the doldrums, it’s also gunning for a whole different type of customer, with a brand new jet that's undergoing flight tests on the south side of Wichita.
"This is the Scorpion aircraft, designed and developed here at Textron AirLand over the last two and a half years," says Dale Tutt, Chief Engineer for the Scorpion project.
Tutt stands beaming at his fierce-looking grey war bird. He leads the design team that has cobbled a war plane together largely from business jet parts, amazingly quickly. At $20 million apiece, the Scorpion is at least three times cheaper to buy and cheaper still to fly and maintain than an F-16. But, with its subsonic top speed, the Scorpion is a lot slower too. Tutt says it’s designed for mainly developing countries that can’t afford more advanced attack craft.
"We can fly all the same missions with the Scorpion at a much more affordable cost," says Tutt.
Tutt clearly enjoys this project. From the air intakes to the military ejection seats that the plane was partially designed around, the project has been fun.
"This is like every engineers dream," laughs Tutt.
Every unemployed aviation engineer, especially, and Tutt says there were plenty of them in town, laid off from Beechcraft, Cessna, and Boeing to staff the Scorpion design team.
Richard Aboulafia, an industry analyst, says repackaging Wichita business jet parts and know-how is great, but, normally military planes are built to meet a specific, stated demand.
"What they’re doing is imagining a theoretical market, and creating a product to meet that market," Aboulafia said. "I’m not so sure this market exists at all."
Cleared for takeoff?
Aboulafia is also skeptical that Wheels Up is going to spark a surge in airplane manufacturing. It’s a good idea, he says, but only a little cheaper than lowest cost alternatives. Still, he says there’s good news for Wichita with or without Wheels Up or the Scorpion.
"All the numbers look great," Aboulafia said. "Whether it’s in terms of the availability of used aircraft which is way down, or corporate profits which are way up, or age of fleet which is up, and people should be replacing them, and deliveries are up."
Smaller business owners, the ones likely to by small planes made in Wichita, are still cautious, but Aboulafia says new sales, and eventually jobs, should be in the offing.
Things have already turned around for Kevin Bell. He’s building the nose sections of Bowing 787s, in Wichita, as the aviation industry here seems finally cleared for takeoff.