By Sharon McBrayer
HICKORY, NC — A company that wants to break into the corporate business jet industry plans to start production on a single-engine jet next year.
It’s been a bumpy road for VisionAire Jets to get to this point but its CEO and founder Jim Rice says he wants to create 600 jobs for the local area within the next four years. Company officials say Catawba County has the work force for assembling and building the jets.
As the company rolls out its jet made of composite material, Rice says it will make corporate business jet travel more affordable.
The company, which is based in Newton with offices in Hickory and St. Louis, has a jet model, VisionAire Vantage, that is light-weight, cheaper to buy and maintain, can fly faster and higher than competitors and can use shorter runways found at municipal airports, say officials. It can transport six people, including a pilot, and can fly as high as 41,000 feet, according to company information.
On a recent day at the company’s office at Hickory Regional Airport, Rice said the company is about three years from delivering its first jets. He said airplane development takes about 15 years.
Rice and the company have been through some shakeups but continue to move forward, believing the vision will eventually become reality.
Development of jet began in 1988
VisionAire Jets Corporation started in 1988 and rolled out its prototype in the mid 1990s and it flew its first test in 1996 over the Mojave Desert. In the late 1990s, the company determined a technical design problem with the jet and stopped raising money from outside investors, Rice said. There also was a weight problem with the prototype that had to be worked out, he said.
A group of investors built a building and leased it to VisionAire Jets in Ames, Iowa, that was intended as a production facility, said Steve Goodhue, who worked for the company in Ames but left after four years to take a job at a bank. The production facility was built near the airport in Ames, Iowa and the company purchased some equipment, he said.
It also tried to get the plane certified by the Federal Aviation Administration, said Steve Schainker, Ames city manager.
Goodhue said there was a great deal of excitement from folks in Ames because of the promise of jobs.
Schainker said the city of Ames gave the company some incentive money and the city received a state grant on VisionAire Jets’ behalf to build a road to its manufacturing facility. However, the jobs the company promised to create didn’t happen and the city had to pay the state back for the grant, Schainker said.
And several investors were not able to recoup their investment, Goodhue said.
However, people investing in the company understood there was some risk involved, he said.
The company, as did other aeronautical companies, suffered after the terrorist attacks on Sept. 11, 2001.
The company was forced into bankruptcy in 2003 and its intellectual property was bought by a company in Ames, Iowa that contracted with a man in San Paolo, Brazil, who turned the jet into a twin-engine jet, Rice said. The company that had acquired the intellectual property filed for bankruptcy in 2009. Within the last two years, Rice has been able to get back all of VisionAire Jets’ intellectual property, according to company information.
When the company filed bankruptcy, it had 155 firm orders for the Vantage, which was voided by the bankruptcy of VisionAire Corporation. The customers were refunded their deposits, according to company information.
The company has spent $110 million in investments and is now looking for another $102 million in investments, Rice said. That money would take the company through FAA certification, into production and ultimately rolling jets off of the production line, he said.
Company officials are looking for investors not just locally but in other countries, including China. Rice said he met with a representative from a Chinese company about investing in the VisionAire Jets. Rice said the large investments in aviation are coming from offshore nowadays.
The company plans to sell its jet for $2.25 million, which it says is cheaper than what the competition offers.
FAA approval, competition are hurdle
One of the biggest hurdles the company has to overcome is getting the jet certified by the Federal Aviation Administration, which takes money and time.
Arlene Salac, external communications representative for the FAA, said the process involved in certifying a new type of aircraft is a very lengthy process. She said the time frame for certification would depend on many factors, some involving the FAA’s approval process and others depending on the timeliness of the company or individual designing the new product.
VisionAire Jets company officials say there is a void in the market for a low-cost business jet. Marc Bailey, executive vice president of business operations, said the company’s closest competitor is the Cessna Citation Mustang, which sells for around $3.8 million, Rice said. The next closest competitor is Honda, which sells its jet for around $4.7 million, he said.
According to VisionAire Jets information, Cirrus Aircraft of Duluth, Minn., and Diamond Aircraft in in London, Ontario, are each developing single-engine jets but VisionAire Jets’ 30-month time schedule makes it competitive time-wise.
According to information from VisionAire Jets, Piper discontinued its plan to develop a light jet and Diamond Aircraft came close to doing the same until being bought by a Dubai-based investment firm in late 2011.
The company information also said the forecasting outlook at this point remains uncertain. The market in North America for general aviation aircraft is not growing quickly but North American operators added more units to their fleets than operators in any other region. Latin American and Asian fleets grew quickly but Asia’s growth doesn’t make up for losses in other regions.
Deliveries of general aviation aircraft in all regions of the world fell after 2008 and don’t seem to have recovered to the same amount, according to VisionAire Jets information.