Piper Aircraft has a Made-To-Order Philosophy and Changes Model
On March 25, 2016, Molly McMillin released an article in the Weekly of Business Aviation which talks about Piper Aircrafts being made to order. Piper Aircraft has transitioned to fully 100% made to order. Here’s what Simon Caldecott the President and CEO of Piper has to say about it.
“This year, we have gone to 100% made-to-order. The customer really has to place the order, either with us or with our dealer. We will then make it to whatever they want, when they want.”
In the past few years, Piper has had a few aircrafts built without owners to purchase them. In 2014 there was an excess of 16 aircrafts. However, by the end of 2015, there was only an excess of two. Caldecott is content with two aircrafts in excess. Here is what he mention.
““I’m OK with always having one or two. The goal is not to have a ramp full of them.”
In order to have such a low excess of inventory, Piper tries its best to predict forecast product rates and based their production off of those numbers. Once from there, they hope that their prediction is correct.
Caldecott explains a little bit about the philosophy he has when it comes to Piper Aircrafts and selling them.
“I want to buy the parts, build the plane and sell it, so it’s just passing through.”
According to Drew McEwen, the vice president of sales and marketing at Piper, the total change in philosophy will have a positive effect on aircraft pricing.
Not only does the philosophy have a positive effect on aircraft pricing, but the used aircraft market will also have some improvement. Here’s what McEwen has to say.
“With a lot of airplanes in the market, there’s a lot of discounting going on. The customer going out to buy an airplane won’t see a lot of airplanes out there for sale.”
Piper Aircraft was founded in 1927 by William Piper with headquarters currently in Vero Beach in Florida. The Brunei Ministry of Finance now currently owns Piper Aircraft. There are roughly 90,000 Piper aircrafts that have been produced since 1927.