Reality Check: 1Q Production

Guest Discussion
1

Understand that we have some forum members who react emotionally to any implied criticism of CD’s performance. However, I think an occassional dose of reality does us all some good.

A comparison of 1Q actual production with Ian Bentley’s 2/14/01 forecast for 1Q is the case in point.

1Q Production

 Actual: 24 (127 4/1/01 vs 103 1/1/01)

 Fcst: 36 (12 / month in 1Q per IBs 2/14/01 note to customers)

 Shortfall: 12 = 33% of forecast or 50% of actual, whichever you prefer. Forecast error is actually even larger when you consider that 1/2 the quarter was already over when the forecast was made! After a year of production, I would have expected an organization which really understood the challenges facing it to be able to make a better forecast, at the very least.

This simply reinforces the concern that CD still doesn’t have its arms around the complexity of volume production of the SR20/22. The failure to replace senior production management since early January raises similar issues. While the anecdotal evidence about lower hours per wing etc would sound encouraging, still doesn’t seem to have made it to the bottom line – actual output.

Unless IB gives us anther update, the forecast for the next few months is 20+/month (1/day). It will be interesting to see whether they can achieve this - or are we looking at more like 15- / month? And Alan K’s “something over 300 aircraft this year” sounds more and more like Alan G’s “irrational exuberance”.

On a positive note, does anyone know if the long rumored “institutional” equity participation / cash injection went through 3/31/01? If so, that should buy CD mgt some time to get their arms around the production problems. If not . . .

Bob

2

Bob,

CD is less committed to update the website than it is to increase production rate. The site is updated every once in awhile and don’t forget it states aircrafts delivered and NOT produced. It is a bit narrow sighted to judge the performance of CD by a number you see on their website. I also think we should spend too much time measuring CD’s performance or lack of by multiplying some numbers, wait for the end of the Q and see if they got it right on the mark. We should look at the big picture and realize that that they’ve come back big time in terms of increasing production rate.

According to my info they’re building between 4 and 5 planes a day NOW, with 20 % less staff. Production flow seems to be much more stable than at the end of last year.

Remember, when IB stated those numbers they were meant as approximation and not as THE number to definately count on. I am pretty happy, as I think they got close to those numbers, far closer than you would think based on your calculation.

Life is good, production is increasing and your wait will prove to be worth every minute. Put a smile on your “smiley”.

Have a good start of the week

Cheers,

Placido

Understand that we have some forum members who react emotionally to any implied criticism of CD’s performance. However, I think an occassional dose of reality does us all some good.

A comparison of 1Q actual production with Ian Bentley’s 2/14/01 forecast for 1Q is the case in point.

1Q Production

Actual: 24 (127 4/1/01 vs 103 1/1/01)

Fcst: 36 (12 / month in 1Q per IBs 2/14/01 note to customers)

Shortfall: 12 = 33% of forecast or 50% of actual, whichever you prefer. Forecast error is actually even larger when you consider that 1/2 the quarter was already over when the forecast was made! After a year of production, I would have expected an organization which really understood the challenges facing it to be able to make a better forecast, at the very least.

This simply reinforces the concern that CD still doesn’t have its arms around the complexity of volume production of the SR20/22. The failure to replace senior production management since early January raises similar issues. While the anecdotal evidence about lower hours per wing etc would sound encouraging, still doesn’t seem to have made it to the bottom line – actual output.

Unless IB gives us anther update, the forecast for the next few months is 20+/month (1/day). It will be interesting to see whether they can achieve this - or are we looking at more like 15- / month? And Alan K’s “something over 300 aircraft this year” sounds more and more like Alan G’s “irrational exuberance”.

On a positive note, does anyone know if the long rumored “institutional” equity participation / cash injection went through 3/31/01? If so, that should buy CD mgt some time to get their arms around the production problems. If not . . .

Bob

3

Bob,

as I said in only 3 days your calculated performance gap has been reduced by almost 50%. You can bet there are still plenty of SRs sitting on the tarmac waiting for the customers to pick them up.

I am sure that the real performance gap (if any) would have been in the single digits. Now you would say its still a gap. You’re right;)

Cheers,

Placido

Understand that we have some forum members who react emotionally to any implied criticism of CD’s performance. However, I think an occassional dose of reality does us all some good.

A comparison of 1Q actual production with Ian Bentley’s 2/14/01 forecast for 1Q is the case in point.

1Q Production

Actual: 24 (127 4/1/01 vs 103 1/1/01)

Fcst: 36 (12 / month in 1Q per IBs 2/14/01 note to customers)

Shortfall: 12 = 33% of forecast or 50% of actual, whichever you prefer. Forecast error is actually even larger when you consider that 1/2 the quarter was already over when the forecast was made! After a year of production, I would have expected an organization which really understood the challenges facing it to be able to make a better forecast, at the very least.

This simply reinforces the concern that CD still doesn’t have its arms around the complexity of volume production of the SR20/22. The failure to replace senior production management since early January raises similar issues. While the anecdotal evidence about lower hours per wing etc would sound encouraging, still doesn’t seem to have made it to the bottom line – actual output.

Unless IB gives us anther update, the forecast for the next few months is 20+/month (1/day). It will be interesting to see whether they can achieve this - or are we looking at more like 15- / month? And Alan K’s “something over 300 aircraft this year” sounds more and more like Alan G’s “irrational exuberance”.

On a positive note, does anyone know if the long rumored “institutional” equity participation / cash injection went through 3/31/01? If so, that should buy CD mgt some time to get their arms around the production problems. If not . . .

Bob

4

Ooops,

I should’ve previewed the post before sending it.

Of course I wanted to say that

…we SHOULDN’T spend too much time…

Placido

Bob,

CD is less committed to update the website than it is to increase production rate. The site is updated every once in awhile and don’t forget it states aircrafts delivered and NOT produced. It is a bit narrow sighted to judge the performance of CD by a number you see on their website. I also think we should spend too much time measuring CD’s performance or lack of by multiplying some numbers, wait for the end of the Q and see if they got it right on the mark. We should look at the big picture and realize that that they’ve come back big time in terms of increasing production rate.

According to my info they’re building between 4 and 5 planes a day NOW, with 20 % less staff. Production flow seems to be much more stable than at the end of last year.

Remember, when IB stated those numbers they were meant as approximation and not as THE number to definately count on. I am pretty happy, as I think they got close to those numbers, far closer than you would think based on your calculation.

Life is good, production is increasing and your wait will prove to be worth every minute. Put a smile on your “smiley”.

Have a good start of the week

Cheers,

Placido

Understand that we have some forum members who react emotionally to any implied criticism of CD’s performance. However, I think an occassional dose of reality does us all some good.

A comparison of 1Q actual production with Ian Bentley’s 2/14/01 forecast for 1Q is the case in point.

1Q Production

Actual: 24 (127 4/1/01 vs 103 1/1/01)

Fcst: 36 (12 / month in 1Q per IBs 2/14/01 note to customers)

Shortfall: 12 = 33% of forecast or 50% of actual, whichever you prefer. Forecast error is actually even larger when you consider that 1/2 the quarter was already over when the forecast was made! After a year of production, I would have expected an organization which really understood the challenges facing it to be able to make a better forecast, at the very least.

This simply reinforces the concern that CD still doesn’t have its arms around the complexity of volume production of the SR20/22. The failure to replace senior production management since early January raises similar issues. While the anecdotal evidence about lower hours per wing etc would sound encouraging, still doesn’t seem to have made it to the bottom line – actual output.

Unless IB gives us anther update, the forecast for the next few months is 20+/month (1/day). It will be interesting to see whether they can achieve this - or are we looking at more like 15- / month? And Alan K’s “something over 300 aircraft this year” sounds more and more like Alan G’s “irrational exuberance”.

On a positive note, does anyone know if the long rumored “institutional” equity participation / cash injection went through 3/31/01? If so, that should buy CD mgt some time to get their arms around the production problems. If not . . .

Bob

5

Placido -

With all due respect, I think your standards are just too low. a 33% underrun versus forecast made in the middle of the quarter would be totally unacceptable in any manufacturing operation I’ve ever worked in. Period.

If the current performance continues and they don’t find someone with deep pockets, these guys are out of business.

As for the 4 - 5 / week, I, for one, will wait until it shows up in the actuals. It is always easier to promise than to deliver.

Bob

Under Promise, Over Deliver".

Ooops,

I should’ve previewed the post before sending it.

Of course I wanted to say that

…we SHOULDN’T spend too much time…

Placido

Bob,

CD is less committed to update the website than it is to increase production rate. The site is updated every once in awhile and don’t forget it states aircrafts delivered and NOT produced. It is a bit narrow sighted to judge the performance of CD by a number you see on their website. I also think we should spend too much time measuring CD’s performance or lack of by multiplying some numbers, wait for the end of the Q and see if they got it right on the mark. We should look at the big picture and realize that that they’ve come back big time in terms of increasing production rate.

According to my info they’re building between 4 and 5 planes a day NOW, with 20 % less staff. Production flow seems to be much more stable than at the end of last year.

Remember, when IB stated those numbers they were meant as approximation and not as THE number to definately count on. I am pretty happy, as I think they got close to those numbers, far closer than you would think based on your calculation.

Life is good, production is increasing and your wait will prove to be worth every minute. Put a smile on your “smiley”.

Have a good start of the week

Cheers,

Placido

Understand that we have some forum members who react emotionally to any implied criticism of CD’s performance. However, I think an occassional dose of reality does us all some good.

A comparison of 1Q actual production with Ian Bentley’s 2/14/01 forecast for 1Q is the case in point.

1Q Production

Actual: 24 (127 4/1/01 vs 103 1/1/01)

Fcst: 36 (12 / month in 1Q per IBs 2/14/01 note to customers)

Shortfall: 12 = 33% of forecast or 50% of actual, whichever you prefer. Forecast error is actually even larger when you consider that 1/2 the quarter was already over when the forecast was made! After a year of production, I would have expected an organization which really understood the challenges facing it to be able to make a better forecast, at the very least.

This simply reinforces the concern that CD still doesn’t have its arms around the complexity of volume production of the SR20/22. The failure to replace senior production management since early January raises similar issues. While the anecdotal evidence about lower hours per wing etc would sound encouraging, still doesn’t seem to have made it to the bottom line – actual output.

Unless IB gives us anther update, the forecast for the next few months is 20+/month (1/day). It will be interesting to see whether they can achieve this - or are we looking at more like 15- / month? And Alan K’s “something over 300 aircraft this year” sounds more and more like Alan G’s “irrational exuberance”.

On a positive note, does anyone know if the long rumored “institutional” equity participation / cash injection went through 3/31/01? If so, that should buy CD mgt some time to get their arms around the production problems. If not . . .

Bob

6

Well stated Bob! You got my point exactly. Cirrus simply is not making their numbers; planned, forecast or otherwise. A detailed production plan with specific “delivery windows” for each customer is not only reasonable but expected. I don’t know what Ian is smoking but it sure messes with his math skills. No doubt about it the SR’s are great planes and the CD team has really done an excellent job bringing the plane to market. Now they just need some excellence in manufacturing…

7

Bob,

my standard might be lower than yours but not as low as your calculation might suggest. Between CD’s non-updated website showing 127 DELIVERED airplanes and the actual number of produced airplanes there might very well be 5 to 10 aircrafts which your calculations do not consider, so the shortfall is way lower than you think.

But here we are, I ACCEPT a shortfall as the big picture is going in the right direction, so my standards seem to be lower than yours. I can live with that.

Cheers,

Placido

P.S. I only admit lower standards in the production timeline and absolutely not in quality.

Placido -

With all due respect, I think your standards are just too low. a 33% underrun versus forecast made in the middle of the quarter would be totally unacceptable in any manufacturing operation I’ve ever worked in. Period.

If the current performance continues and they don’t find someone with deep pockets, these guys are out of business.

As for the 4 - 5 / week, I, for one, will wait until it shows up in the actuals. It is always easier to promise than to deliver.

Bob

Under Promise, Over Deliver".

Ooops,

I should’ve previewed the post before sending it.

Of course I wanted to say that

…we SHOULDN’T spend too much time…

Placido

Bob,

CD is less committed to update the website than it is to increase production rate. The site is updated every once in awhile and don’t forget it states aircrafts delivered and NOT produced. It is a bit narrow sighted to judge the performance of CD by a number you see on their website. I also think we should spend too much time measuring CD’s performance or lack of by multiplying some numbers, wait for the end of the Q and see if they got it right on the mark. We should look at the big picture and realize that that they’ve come back big time in terms of increasing production rate.

According to my info they’re building between 4 and 5 planes a day NOW, with 20 % less staff. Production flow seems to be much more stable than at the end of last year.

Remember, when IB stated those numbers they were meant as approximation and not as THE number to definately count on. I am pretty happy, as I think they got close to those numbers, far closer than you would think based on your calculation.

Life is good, production is increasing and your wait will prove to be worth every minute. Put a smile on your “smiley”.

Have a good start of the week

Cheers,

Placido

Understand that we have some forum members who react emotionally to any implied criticism of CD’s performance. However, I think an occassional dose of reality does us all some good.

A comparison of 1Q actual production with Ian Bentley’s 2/14/01 forecast for 1Q is the case in point.

1Q Production

Actual: 24 (127 4/1/01 vs 103 1/1/01)

Fcst: 36 (12 / month in 1Q per IBs 2/14/01 note to customers)

Shortfall: 12 = 33% of forecast or 50% of actual, whichever you prefer. Forecast error is actually even larger when you consider that 1/2 the quarter was already over when the forecast was made! After a year of production, I would have expected an organization which really understood the challenges facing it to be able to make a better forecast, at the very least.

This simply reinforces the concern that CD still doesn’t have its arms around the complexity of volume production of the SR20/22. The failure to replace senior production management since early January raises similar issues. While the anecdotal evidence about lower hours per wing etc would sound encouraging, still doesn’t seem to have made it to the bottom line – actual output.

Unless IB gives us anther update, the forecast for the next few months is 20+/month (1/day). It will be interesting to see whether they can achieve this - or are we looking at more like 15- / month? And Alan K’s “something over 300 aircraft this year” sounds more and more like Alan G’s “irrational exuberance”.

On a positive note, does anyone know if the long rumored “institutional” equity participation / cash injection went through 3/31/01? If so, that should buy CD mgt some time to get their arms around the production problems. If not . . .

Bob

8

Now your understanding the whole picture.Get on these guys and tell them to get you some numbers.For now,I will get you some.Some weeks we can do 2 planes ,some weeks more.If a ac needs repairs (does happen often) it can stall that ac in the line and another ac will jump in front.The managment that got laid off really didn’t do a damn thing anyways.Just walked around and wasted payroll.Reality is what I speak.They will tell you’all somethin’ to calm you down for a bit but,they have the obligation to be honest with you.Cirrus … or as deep throat says… go where the money is.The -22’s for now.Did they tell you when you signed your contract the -22 might delay your date? hmmm… good question. the glue miester

9

Placidio -

Agree that they will eventually produce the 36 aircraft IB forecast - they just didn’t do it in 1Q per CDs delivery numbers.

Assuming work in process inventory remains constant from quarter to quarter (no way of knowing given they don’t report production or inventory separately), then 24 aircraft delivered prior to 4/1/01 would mean 24 aircraft produced. Non-customer deliveries (i.e. non-revenue deliveries) were probably zero or very close to it.

We’ll see what April looks like. Agree that they are off to a good start with 5 deliveries so far.

Might even make the 20.

Bob

Bob,

as I said in only 3 days your calculated performance gap has been reduced by almost 50%. You can bet there are still plenty of SRs sitting on the tarmac waiting for the customers to pick them up.

I am sure that the real performance gap (if any) would have been in the single digits. Now you would say its still a gap. You’re right;)

Cheers,

Placido

Understand that we have some forum members who react emotionally to any implied criticism of CD’s performance. However, I think an occassional dose of reality does us all some good.

A comparison of 1Q actual production with Ian Bentley’s 2/14/01 forecast for 1Q is the case in point.

1Q Production

Actual: 24 (127 4/1/01 vs 103 1/1/01)

Fcst: 36 (12 / month in 1Q per IBs 2/14/01 note to customers)

Shortfall: 12 = 33% of forecast or 50% of actual, whichever you prefer. Forecast error is actually even larger when you consider that 1/2 the quarter was already over when the forecast was made! After a year of production, I would have expected an organization which really understood the challenges facing it to be able to make a better forecast, at the very least.

This simply reinforces the concern that CD still doesn’t have its arms around the complexity of volume production of the SR20/22. The failure to replace senior production management since early January raises similar issues. While the anecdotal evidence about lower hours per wing etc would sound encouraging, still doesn’t seem to have made it to the bottom line – actual output.

Unless IB gives us anther update, the forecast for the next few months is 20+/month (1/day). It will be interesting to see whether they can achieve this - or are we looking at more like 15- / month? And Alan K’s “something over 300 aircraft this year” sounds more and more like Alan G’s “irrational exuberance”.

On a positive note, does anyone know if the long rumored “institutional” equity participation / cash injection went through 3/31/01? If so, that should buy CD mgt some time to get their arms around the production problems. If not . . .

Bob

10

Placidio -

Agree that they will eventually produce the 36 aircraft IB forecast - they just didn’t do it in 1Q per CDs delivery numbers.

Assuming work in process inventory remains constant from quarter to quarter (no way of knowing given they don’t report production or inventory separately), then 24 aircraft delivered prior to 4/1/01 would mean 24 aircraft produced. Non-customer deliveries (i.e. non-revenue deliveries) were probably zero or very close to it.

We’ll see what April looks like. Agree that they are off to a good start with 5 deliveries so far.

Might even make the 20.

Bob

Bob,

as I said in only 3 days your calculated performance gap has been reduced by almost 50%. You can bet there are still plenty of SRs sitting on the tarmac waiting for the customers to pick them up.

I am sure that the real performance gap (if any) would have been in the single digits. Now you would say its still a gap. You’re right;)

Cheers,

Placido

Understand that we have some forum members who react emotionally to any implied criticism of CD’s performance. However, I think an occassional dose of reality does us all some good.

A comparison of 1Q actual production with Ian Bentley’s 2/14/01 forecast for 1Q is the case in point.

1Q Production

Actual: 24 (127 4/1/01 vs 103 1/1/01)

Fcst: 36 (12 / month in 1Q per IBs 2/14/01 note to customers)

Shortfall: 12 = 33% of forecast or 50% of actual, whichever you prefer. Forecast error is actually even larger when you consider that 1/2 the quarter was already over when the forecast was made! After a year of production, I would have expected an organization which really understood the challenges facing it to be able to make a better forecast, at the very least.

This simply reinforces the concern that CD still doesn’t have its arms around the complexity of volume production of the SR20/22. The failure to replace senior production management since early January raises similar issues. While the anecdotal evidence about lower hours per wing etc would sound encouraging, still doesn’t seem to have made it to the bottom line – actual output.

Unless IB gives us anther update, the forecast for the next few months is 20+/month (1/day). It will be interesting to see whether they can achieve this - or are we looking at more like 15- / month? And Alan K’s “something over 300 aircraft this year” sounds more and more like Alan G’s “irrational exuberance”.

On a positive note, does anyone know if the long rumored “institutional” equity participation / cash injection went through 3/31/01? If so, that should buy CD mgt some time to get their arms around the production problems. If not . . .

Bob

Wow,someone needs to get laid!