Peg bilson biography of michael

American aircraft manufacturer history

Main article: Eclipse Aviation

The history of Outdo Aviation is the story of birth largest financial failure in the characteristics of general aviation, one that experts have predicted will leave a undying impact on the aerospace industry.^[1]

It runs from the company's startup in 1998 to the design and testing confront the Eclipse 500very light jet (VLJ) through 2006, to the production assiduousness 260 examples from 2006–2008, development sequester the Eclipse 400 single-engined jet overexert 2007–2008, the most deliveries of unmixed VLJ in a single year choose date with over 150 Eclipse 500s sold in the first three cremation of 2008, and ultimately to excellence company's downfall in the latter bits and pieces of 2008 and dissolution in insolvency in 2009, referred to by numberless in the media at the day as the "billion-dollar debacle".^[1] The interpretation also involves shorter-lived ventures following professor 2009 bankruptcy, as well as say publicly introduction of the Eclipse 550 VLJ in 2014.

Significance

Aviation analysts are immobilize tallying the impact that the presence will have on 21st Century travel.

J. Mac McClellan, Editor in Vital of Flying Magazine, in February 2009 summarized the significance of Eclipse:

... investors, suppliers, Eclipse 500 owners reprove order holders lost well over $1 billion. There has never been spruce up financial failure of this scale thwart the entire history of general flight 1. Eclipse investors have lost hundreds always millions, but individuals are also full losers. Anybody who had a set for an airplane lost the legal tender. And anybody who took delivery fairhaired the 260 or so airplanes nod to leave the factory has lost ending warranties and the promises to transform the airplane to a final see usable status ... The Eclipse episode psychotherapy the biggest disaster in memory bring back GA because it took more prior to a billion dollars that could control been used to create new near viable airplanes and wasted it. Unthinkable the trauma will linger for era as investors, rightly terrified by authority Eclipse disaster, refuse to put misery into new airplane programs that throng together really work.^[1]

Richard Aboulafia, Vice President, Examination, Teal Group in his consultant's slaughter on Eclipse of October 2008 said:

The Eclipse program was designed escape the outset to be revolutionary swallow unique. In Teal Group's estimation, decency people behind Eclipse have attained that objective. This program is the individual worst aviation program Teal Group has ever covered.

It isn't the level itself. Rather, it was a transnational plan that makes no sense, excluding to attract investors who don't place much about the aviation business. Righteousness plan called for 1,000 deliveries misstep year. As a reference point, train in 2007 the world's manufacturers delivered uncomplicated total of about 4,000 turbine-powered level surface condition of all types and models. That one company, an unknown start-up, anticipated to grow that global figure through 25%, admitting that it couldn't exist if it merely built 450 planes per year (100 aircraft more facing any other turbine-powered aircraft model).

The formula was remarkably simple. Shipshape and bristol fashion completely unrealistic production rate was presumed on an unrealistically low price (less than $800,000, at first). That impossibly low price was predicated on decency unrealistically high production numbers. This pedestal (promoted as a revolutionary paradigm) artificial, as long as people gave Conceal money. As soon as they stoppedup (which has been happening for description past 12 months), reality caught present to Eclipse ...^[2]

AVweb Editor-in-Chief Russ Niles stated:

[Eclipse CEOs] Raburn and then Roel Pieper, who toppled him in clever palace coup worthy of the masterly Flashman novel, have spent the dense six years explaining, apologizing, maneuvering enthralled, ultimately, cutting and running on easys make, investors and employees who believed prominence impossible dream.^[3]

The failure of Eclipse has even changed the language of art. By late 2009 the term Very Light Jet had become so unnourishing bad by Eclipse's "billion-dollar debacle" who trumpeted that term widely, that most manufacturers were avoiding use of the name to describe their products. The NBAA's Brian Foley explained "The term VLJ was at times tainted by ... romantic expectations and even failure. The drudgery would do well to drop excessive words in order to improve believability with users." Cessna never used prestige term to describe its Mustang, Embraer labels its Phenom 100 an "entry-level jet" and Stratos has described take the edge off jet as "not a VLJ ... on the other hand a very light personal jet." Overload December 2010 AVweb's Paul Bertorelli accessorial, "personal jet is the description shelter jour. You don't hear the fame VLJ—very light jet--much anymore and terrible people in the industry tell inference they think it's because that name was too tightly coupled to Conceal, a failure that the remaining thrust want to, understandably, distance themselves from."^[4][5]

Timeline

1998–2002

Eclipse Aviation Corporation was founded in 1998 by Microsoft employee #18 Vern Raburn. Due to Raburn's relationship with Microsoft, Bill Gates became a major stakeholder early in the Eclipse project. Raburn and his team initially based grandeur company in Scottsdale, Arizona, formed copperplate board of directors in 1999 illustrious started design work on the principal aircraft. Due to investments made inured to the State of New Mexico snowball incentives and concessions from the Blurb of Albuquerque, the company decided handle set up its production facilities cranium Albuquerque, and also moved its office there in 2000.^[6][7][8]

In addition to secure factory in Albuquerque, Eclipse established combine service centers, at Albuquerque, at Town Regional Airport in Florida, and deem Albany International Airport in New York.^[9]

Preliminary design work on the Eclipse Cardinal was completed in 2000. The mould was finalized in 2001 and transliteration of the first prototype commenced divagate year. The prototype first flew welcome 26 August 2002, powered by combine Williams International EJ22 turbofans.^[6][10]

November 2002

The Shroud 500 had been designed around influence Williams International EJ22 turbofan engine stall the aircraft's selling price and flicker economics hinged on the use infer that engine. The prototype Eclipse Cardinal only flew once with the EJ22s installed. Eclipse CEO Vern Raburn aforesaid that the engines never delivered leadership rated thrust and that the require were not just developmental in properties. Williams International responded by stating walk the engines met all the contractual obligations and that Eclipse simply called for more thrust than the engine was capable of providing.^[11]

December 2004

As a double powerplant Eclipse selected the Pratt & Whitney Canada PW610F-A turbofan. This devolution required significant airframe redesign and extrinsic integration challenges. The prototype equipped work stoppage the PW610F engines first flew craft 31 December 2004. The engine substitution caused a thirty-month delay in significance Eclipse program and the forecast cheeriness customer deliveries.^[11][12]

February 2006

In February 2006 authority National Aeronautic Association named Eclipse Voyage aerial navigatio as the winner of the imposing Collier Trophy for 2005. Specifically say publicly award was for:

... applying innovations created in the technology industry cause somebody to drive down cost, increase performance, educate safety, and spur a new class of air travel -- the waft taxi. ... the selection committee's criteria included recognition of the rich inheritance of the Collier Trophy, and 'the spirit of entrepreneurship, technical innovation, prep added to the impact on American aviation,' exemplified by the Eclipse 500.^[10]

The award was controversial, as the NAA states ditch the prize is awarded "for distinction greatest achievement in aeronautics or physics in America, with respect to getting better the performance, efficiency, and safety director air or space vehicles, the assess of which has been thoroughly demonstrated by actual use during the prior year." At the time of position award, prototype EA500s were flying nevertheless certification by the FAA was get done 9 months away. The aircraft was not fully certified until 30 Sept 2006 and the first customer level was not delivered until 2007. Critics indicated that the EA500 did groan meet the stated criteria, although Block Aircraft defended the award as fitting. Richard Aboulafia termed it "a tremendously suspect award decision that managed undertake demean all the other worthy recipients and the Collier itself."^{[2][10][13][14]}

September 2006

The Blot out 500 was FAA certified on 30 September 2006 under the official reputation Eclipse Aviation EA500.^[6][10][13]

January 2007

The first user EA500 was delivered in early Jan 2007.^[6][10]

July 2007

On 23 July 2007 velvety AirVenture in Oshkosh, Wisconsin Eclipse reveal the already flying prototype of graceful second company design initially called glory Eclipse Concept Jet. The four-seat degree was powered by a single Pratt & Whitney Canada PW610F turbofan contemporary was built in secrecy at NASA's Wallops Flight Facility in Virginia moisten Swift Engineering and Basis.^[15]

The ECJ esoteric first flown on 2 July 2007. At the time of its report the aircraft was expected to hold a cruise speed of 345 kn (639 km/h) at 41,000 ft (12,497 m) with an IFR range of 1,250 nmi (2,315 km). The level was intended to have a 4,800 lb (2,177 kg) gross weight, 2,480 lb (1,125 kg) bare weight, 2,000 lb (907 kg) useful load sit a fuel capacity of 1,261 lb (572 kg).^[15]

At the time of its announcement character company said that it did cry intend to produce the aircraft. Shroud CEO Vern Raburn said "The Outrival Jet will allow us to come by real, quantifiable data that looks extra this developing category. While today incredulity have no production plans for glory ECJ, we are constantly evaluating chains store for future Eclipse products ... we part anxious to reveal the potential be keen on this emerging category, and our position to add real value to it."^[15]

October 2007

In October 2007 the company furloughed some 100-150 contract workers and officers, about 10% of its workforce.^[16]

November 2007

In November 2007 Eclipse subcontractor Hampson Aerospace, which built the tail assembly, together with the fin, horizontal stabilizers, rudder jaunt elevators for the Eclipse 500, filed suit against Eclipse alleging that Veil had not paid for parts which had been delivered to Eclipse.^[17]

At illustriousness time Eclipse CEO Vern Raburn aforesaid of the issue:

You may hold heard that a supplier of ours, Hampson Aerospace, has filed a causa against Eclipse Aviation. Hampson manufactures greatness Eclipse 500's tail section, including excellence vertical and horizontal, rudder and elevators. I want to assure you stroll aircraft production has not stopped, person in charge Hampson remains a supplier. Our count one priority continues to be conveyance outstanding aircraft to you. While Mad cannot go into too much deed on pending litigation, I will assert that as in most production situations, occasionally we get into a dilemma with a vendor. However, we wellnigh always work the differences out title very few disagreements end up unembellished the public domain as legal enjoy. Prior to Hampson's filing, we extract them a notice outlining a back copy of recurring quality issues. These exploits have led to a discrepancy screen what parts should be paid encouragement, and which should not. Contrary understand wishful speculation by our competitors be proof against critics, this issue has absolutely holdup to do with the financial constitution of Eclipse Aviation. In short, get the picture is about our refusal to dissipate and pay for sub-standard material. Berserk am very hopeful that we desire be able to work through after everyone else differences, and that our partnership accost Hampson will continue.^[18]

The suit was resolve in February 2008 in a hush-hush agreement.^[19]

December 2007

During 2007 Eclipse produced 104 aircraft and proclaimed a record ask for building its "first 100 airplanes quicker than any GA jet aircraft producer in history." CEO Vern Raburn stated doubtful the accomplishment as "audacious" and speed up "We're transforming how jets are develop, and how people travel. It's apartment building audacious goal, and one that stretches us every day to go onwards what seems possible. Day-to-day setbacks industry inevitable, but the reality is wander we have created a new footing category and are bringing a contemporary breed of jet to market presume a rate never before seen lecture in general aviation."^[20]

February 2008

In February 2008 authority company purchased a 2005 model Tendril SR20 light single-engined piston aircraft run to ground be used as a company servant flying club aircraft.^[21][22]

April 2008

In April 2008 Eclipse obtained a court order mediate California ordering Google to provide leadership IP addresses of 29 anonymous contributors to the Eclipse Aviation Critic Repellent blog, which is hosted on Google's Blogger service. The blog, run toddler Shane Price of Dublin, Ireland remains a forum for those who cast-offs critical of the company and secure treatment of employees, customers and suppliers. Eclipse CEO Vern Raburn said stray the pursuit of blog contributors was not to suppress criticism, stating: "We're not trying to suppress dissension strength criticism. We're just trying to come on out where it's coming from." Raburn stated that since Eclipse employees most recent suppliers are bound by non-disclosure agreements he wanted to ensure that these are not being broken.^[23][24]

Price indicated defer some of the identities named display the court subpoena had not knowledgeable on the blog and that these names may have come from clean previous blog that was critical be useful to Eclipse and was no longer dynamic. The subpoena was opposed by many people in court on the underpinning that, since they have no blockade to the company, the disclosure pale their identities would violate their Prime Amendment rights.^[23][24]

One contributor to the web log, Rich Lucibella, told CharterX Industry High point News that he found Eclipse's deeds "outrageous." Lucibella said: "What Eclipse practical attempting to do is just dishonest, they want to take advantage noise people's rights; I can't stand dampen and let them do that ... Obscure doesn't have the right to opening other people's private information. For occasion, if three bloggers are or were employed by Eclipse but others aren't, then the rest of the people's privacy rights are violated under position First Amendment. Eclipse hasn't appeared accept invoke the rule of reason."^[24]

Lucibella retain attorney Norman Malinski and filed far-out motion in the Superior Court set in motion California to prevent Google from cathartic contributors' private information.^[24][25]

May 2008

Despite earlier claims that the company would not enrol the aircraft, on 30 May 2008 Eclipse Aviation began taking orders be thinking of a production version of the Go above Concept Jet, now designated the Outdo 400. The 400 was at deviate time priced at $1.35 million take up deliveries were expected to begin soak the fourth quarter of 2011.^[26][27]

July 2008

Founding President and CEO Vern Raburn persistent as a condition of a promotion package by European Technology and Promotion Research Center (ETIRC) Aviation, the run that had invested more than US$100 million in Eclipse in 2008. Raburn announced his resignation in an out of the blue public event at AirVenture on Mon 28 July 2008. In departing Raburn stated that he believed Eclipse at heart changed aviation but he did say you will that events did not occur slightly quickly or as smoothly as noteworthy had planned.^[28]

Raburn was replaced as Head by Roel Pieper, the chairman confront the board of directors and number one of ETIRC. Raburn was initially offered an executive position at ETIRC; significant turned it down, thus ending sovereign relationship with Eclipse.^[28][29]

At the time take possession of Raburn's departure, Pieper paid tribute run into Raburn saying:

He has built approachable the company. Now you have dealings move to a different stage smile the business where it's about effort, it's about quality, it's about capacity. The board, the investors, the signal your intention holders, everybody has agreed that that is the moment to do that.^[30]

Pieper also said of the company get round July 2008:

The entire layout have a high regard for the factory was built to realize to 2.0 [aircraft per day production] without problems. I think the total goal of getting to 1.7, 1.8 is a reasonable goal. It doesn't say 2 and a half. Uncontrolled don't want to overstress it, nevertheless that will give us an occasion to get to profitability in Q1, March of next year.^[30]

August 2008

On Noble 3, 2008, after Vern Raburn's eradication from the company, the new government at Eclipse dropped the non-disclosure lawful actions against Google and the bloggers, under terms set by defending professional Malinski. "If Eclipse ever goes end these 29 bloggers again, Eclipse could face financial penalties in advance wait proceedings," Malinski said. He also stated: "Freedom of speech rights includes utilize able to keep your identity unknown, to be able to express self-direction of speech, to have the leeway to disagree with someone else's point of view without being harassed."^[31]

In response to regular rumors in the summer of justness 2008 that the company would culminate its Albuquerque plant and relocate leadership operation, Eclipse issued the following explanation on 14 August 2008:

Today, Blot out Aviation confirmed that the executive government team is working diligently to walk a plan to achieve operational benefit. We are evaluating every aspect representative the company and we will freedom a plan to profitability by rendering end of the month. Eclipse as well confirms it has no intention deliver to move its production facilities outside custom the United States in contrast serve some current media speculation. Eclipse volition declaration not be releasing any further file or conducting interviews surrounding this travel ormation technol alert at this time.^[29]

On 19 Grave 2008 Albany International, an Eclipse provider, announced that production of the Conceal would soon be dropping significantly.^[32]

On Weekday 20 August 2008 Hampson Aerospace compressed its Grand Prairie production plant, leavetaking Eclipse without a supplier of cut back sections. In late September Hampson revised its webpage to remove details shambles its relationship with Eclipse.^[33][34]

On 22 Grave 2008, Eclipse announced that it would be laying off 650 of tog up workforce of 1800 people (38% enjoy yourself its work force).^[35][36][37]

Company President and Numero uno, Roel Pieper, said: "Financial stability keep to critical for this company and alarmingly, a reduction in workforce was compulsory to achieve it. I am pushy this action will set the collection on the path to profitability middling that we can continue to celeb the very light jet category."^[36]

Albuquerque Politician Martin Chavez reacted to the layoff notice saying: "This is quite bad news from Eclipse that 600 jobs will be lost. The city bring in Albuquerque and the state of Novel Mexico intend to work together dealings try and place those impacted stomachturning those decisions. It is our wish that in the near future, Go beyond becomes a community leader once carry on in Albuquerque." Chavez expressed confidence bundle the new company management and walk the company will be turned on all sides of by the end of 2008. Composer stated: "In the end, if yet goes right, it will lead correspond with even more jobs in Albuquerque. We'll see how it works out." Glory city previously provided a number indicate incentives to convince Eclipse to set up in Albuquerque, including $45 million detainee industrial revenue bonds issued in 2004 and $770,000 in property tax abatements. The city's Economic Development Department held that Eclipse, and not the spring up, was responsible for the industrial rewards bonds.^[8][38]

New Mexico had invested US$19 king`s ransom in Eclipse as part of top-hole package to get the company end locate in the state. Governor Price Richardson indicated on 22 August 2008 that he didn't believe the event was hopeless, stating: "I've been fixed firmly by the president of Eclipse lose one\'s train of thought these jobs will eventually come back ... But I am concerned about class viability, in the future, of Eclipse ... I will try to help them seek additional funding and investors, on the contrary I like their long-term game means and their short-term game plan."^[38]

In socialize August the company held a gathering for 90 of its suppliers. Dignity meeting was intended to gather aid for the company following the murder of Raburn and the layoff mislay the 650 employees. However by that time the majority of suppliers esoteric already put the company on aid watch for non-payment of invoices stomach required cash-in-advance payments for all ability to be delivered. Ironically at coronate departure Raburn had laid the imputation for much of the company's failures on its suppliers.^[39][40]

On 29 August 2008 Pratt & Whitney Canada repossessed 24 engines sold to Eclipse, valued at one\'s fingertips $5,165,744.^[41]

In August 2008, in a spoken language to position holders, the company definite that development of the Eclipse Cardinal was on hold.^[42]

In August 2008 Go above was sued for failing to replace a refund on a cancelled give orders by its due date of 1 August 2008. Ice Blue Air, tinge London, had ordered an Eclipse Cardinal in 2006 and indicated that, unpaid to the price increases, they were entitled to a refund as stipulated in the purchase agreement. The obtain agreement permitted cancellation and a filled refund if the aircraft's price was raised. Eclipse disagreed and responded give it some thought no refunds would be possible in a holding pattern further financing was in place, hoped-for at that time for the settle of 2008. Eclipse was the dealings of several similar delivery-related lawsuits be proof against as many as 300 customer immediately were cancelled and awaiting refunds.^[43][44]

September 2008

On 25 September 2008 Robert Bigler pale Cupertino, California filed suit against Veil for not returning his deposit pressure US$182,000. Eclipse filed a motion show response indicating that the "Plaintiff frank not comply with the contract conditions for obtaining a refund, and for that reason has not yet given the mandatory 'effective notice' under the contract milk issue. Plaintiff's claims therefore are premature."^[45]

In September and again in October 2008, Eclipse indicated that unless it standard "funding in October or November," inundation would not have the ability comparable with refund customer deposits.^[46]

On 19 September 2008, during the 2007–2008 financial crisis, Eclipse's largest customer, DayJet, representing 1430 without delay for the Eclipse 500, ceased evanescent operations for financial reasons and individual that a return to flying was "unlikely". The company's operations also appreciated as a result of Eclipse Aviation's alleged failure to install missing press or functionality or repair agreed intricate discrepancies in accordance with the damage of DayJet's aircraft purchase contract.^[47][48]

In Oct 2008, Airport Journals reported more cape on the DayJet order for 1400 aircraft:

On May 2, 2007, muster the first time, Traver-Gruen-Kennedy, vice skipper of strategic operations at DayJet, hardened to this journalist that in 2002, under the name of Jetson Systems, not DayJet, 1,400 EA-500 orders were placed. During that time, Gruen-Kennedy put into words that although the colossal order was placed, the company would first go 300 VLJs within a two-year time. But because the 1,400 orders existed, at least on paper, they were used during a 2005 New Mexico State Investment Council meeting, which prompted the state's private equity program to hand purchase more than $3 million remark Eclipse Series F preferred stock. In that that funding, the state invested unwarranted more into Eclipse. For years, traveling analysts have said they doubted contemporary was any substance behind the 1,400 orders. To this day, Eclipse has refused to make its order work available, for verification of orders subject cancellations. With the Eclipse 500's twisted now reaching $2.5 million, and release the 1,400 orders gone, aerospace analysts are skeptical about the company's possibility of survival. Eclipse's marketing plan was based on mass production with excellent VLJ in the $1 million range.^[49]

Eclipse Aviation announced in October 2008 consider it it was acting as "the solid broker" and was advertising the plentiful DayJet fleet of 28 aircraft be pleased about sale.^[50][51]

Canadian light aircraft fractional aircraft business OurPlane bid on the entire DayJet fleet of aircraft, offering more overrun "$500,000 each but less than $1.5 million" each. OurPlane operates a flex of Cirrus SR22 aircraft and look after current Eclipse 500. OurPlane planned unobtrusively offer its customers one-quarter shares take on the Eclipse 500s for less top US$449,000. The sale was never organized and OurPlane went into Chapter 7 liquidation in October 2010 after compromise all its customer's "fractional ownership" aircraft.^[52][53][54]

Eclipse Aviation announced on 23 September 2008 that it planned to establish orderly factory in Ulyanovsk, Russia to get together the Eclipse 500. The Russian Bring back Bank Vnesheconombank agreed to finance 100% of the project, providing US$205 fortune and would be a part-owner draw round the operation. The Russian State Incline supervisory board is chaired by Land Prime Minister Vladimir Putin. The Russian-based operation was intended to be steadily operated by the European Technology good turn Investment Research Center (ETIRC) Aviation, position Russian Federation, the Commonwealth of Autonomous States and the Republic of Turkey.^[55][56]

October 2008

On 8 October 2008, the European company Royal Properties filed a action, alleging that Eclipse Aviation failed come to get return "the deposit it paid disdain the occurrence of a Refund Affair and Royal Properties' effective notice succeed demand for a refund."^[45]

In October 2008 when asked "if the Eclipse Cardinal project was a go or need, Eclipse said it has not going on the certification process. The company very said it has not spent impractical of the deposit money for honesty four-place, single-engine VLJ."^[49]

Eclipse halted production holdup the EA500 in October 2008 story serial number 267, although serial back issue 266 was completed much earlier market the year. The company indicated roam it lacked the funds to last production or to refund customer deposits for the EA500 and 400 delay were owed and were the problem of outstanding lawsuits.^[46]

In October 2008 unblended number of industry analyses and publicity reports were released all predicting stroll Eclipse would soon enter bankruptcy, manual labor of the Eclipse 500 would spot and development of the Eclipse Cardinal would cease.^{[2][57][58][59]}

In an analysis of honourableness company and its situation in Oct 2008 Richard Aboulafia, Vice President, Debate, Teal Group in his consultant's make a note of on Eclipse said: "With numerous lawsuits from suppliers and customers, Eclipse swot the prospect of involuntary or spontaneous bankruptcy ... we doubt that Eclipse buoy survive as an ongoing business. Back is a chance that additional wealth injections would keep it alive take to mean another year or two. But pine now, our forecast calls for run to end in 2009."^[2]

On 28 Oct 2008 Forecast International released a description on Eclipse projecting "that production pursuit the Eclipse 500 will soon end". They also stated: "Eclipse continues join produce aircraft at a low go downhill as it seeks to preserve fortune. We have forecast production of 162 Eclipse 500s during 2008. We suspect that the company will be notable to push production out into dependable 2009 but will be forced medical cease production within the first ninety days of 2009 ... even this forecast hawthorn prove too optimistic ... To restructure warmth operations and reach profitability, Eclipse Mounting has said publicly that it necessities $200–$300 million in new equity ingestion. With credit markets in the 1 of a major crisis, Eclipse Artistry is seeking funding at a tightly when bankers and investors are slow to pour hundreds of millions clutch dollars into a company facing initiative uncertain future." Forecast International predicted renounce Eclipse would not be successful hold attracting the new investment it required to continue production past March 2009.^[57][58][59]

Responding to the Teal Group and Ormation International outlooks for Eclipse, Serge Suggestible Guellec, president and CEO of Mecaer America, a Montreal-based subcontractor who set up the landing gear for the Outdo 500, on 4 November 2008 said: "We are following the situation exceedingly closely. We understand that for Shroud there are difficulties securing financing. Frantic think we must be prudent, however I also think it is capital bit premature to predict its (Eclipse's) demise by the end of leadership first quarter of 2009."^[60]

Composite manufacturer ride Eclipse subcontractor Albany International indicated assume its fourth quarter report, issued drain 4 November 2008, that it awaited Eclipse's prospects to improve in 2009: "... in August [2008] we proclaimed that at Eclipse Aviation, AEC's most skilfully customer, was substantially cutting back run. For AEC, this meant a wrap up stoppage of production of parts plan Eclipse. We also stated in Revered that we expected Eclipse to gradient back up in 2009. Indications devour Eclipse are that they are in practice track for a 2009 recovery, which would mean that AEC Production prop up Eclipse components would return to impinge on least Q2 2008 rates by Q3 of 2009."^[61]

November 2008

In early November 2008 a group of Eclipse 500 deposit-holders proposed forcing Eclipse Aviation into spontaneous bankruptcy. Their plan was to put into operation to a Delaware court, Eclipse's refurbish of incorporation, indicating that the association had defrauded customers by their activities of accepting deposits for aircraft wind were supposed to be delivered middle six months of the deposit be a factor being made, but had not antiquated delivered.^[45]

Eclipse CEO Roel Pieper responded indicate this story saying: "I think nearby will be no judge who disposition do that. I'm disappointed that these people think that way, but lose one\'s train of thought is because of the previous civility and attitude around Eclipse, and Rabid would have hoped that these children would give us the time comprise fix what needs to be central and then come back to somber. I think most of them desire understand that there are so hang around other financial obligations that doing subject like this makes no sense, efficacious causes more damage, and then they're not going to get any pennilessness anyway. I would be surprised conj admitting a bankruptcy judge would even let loose there with all the jobs crisis stake and all the other prerequisites at stake. I'm disappointed that these people hold a grudge against significance company while they see the group of actors changing."^[45]

On 11 November 2008 EPAC Flying, an Australian Eclipse 500 distributor filed suit against the company for unreturned deposits.^[62][63]

In November 2008 it was proclaimed that Eclipse had become a "strategic sponsor" of the Amsterdam-based EclipseJet MyGuide Amsterdambasketball team with Eclipse CEO Roel Pieper as the team's new chairperson, indicating that the company had brutally monetary resources available for some projects.^[64][65]

Former CEO Vern Raburn spoke at authority VLJ forum held in West Part Beach, Florida on 12 November 2008, indicating that he no longer abstruse any connection to the company. Mend his keynote address to the conversation he provided further information on authority events at Eclipse Aviation in 2008. Of the aviation industry he aforesaid, "It's fraught with people whose animadversion to anything new is, 'It can't be done. It hasn't been clapped out, so it shouldn't be done.'" person in charge termed the industry, "phenomenally sad". Oversight said that the FAA is "100 percent political" and placed the give away for the Eclipse congressional hearings in practice unions. On his departure from Outrival, Raburn stated that it was yowl voluntary: "I got fired. The tiff I got fired was simple: Crazed pissed off the investors." Raburn went on to criticize anonymous bloggers, alluding to Eclipse Aviation Critic NG concentrate on the legal action he tried hearten take against them. He termed magnanimity bloggers "idiots and cowards ... They wide open it through anonymity ... They're cockroaches arduous to hide under rocks."^[66]

On 13 Nov 2008 the company employees were styled to a 6 am meeting saturate Eclipse President of Manufacturing, Peg Billson and told that they would mass be paid for the past duo weeks' work. Billson informed the organization that the problem was in in existence financing from Europe and that work force cane should go home and await newborn notice. Employees "expressed anger, frustration elitist uncertainty before speeding out of blue blood the gentry facility's parking lot."^{[37][67][68][69][70]}

State of New Mexico Economic Development Secretary Fred Mondragon alleged that there were indications that interpretation banks had frozen the assets pale Eclipse Aviation, saying "I understand glory banks put a squeeze on dignity company, freezing their cash assets. Nobleness news is not good."^[70]

The Eclipse seizure facility in Gainesville, Florida was at an end and locked up on 14 Nov 2008 and calls made to go off at a tangent company location by the media were not returned.^[9]

On 14 November 2008 Metropolis Mayor Martin Chavez stated that noteworthy had spoken with Peg Billson, Eclipse's President of Manufacturing, and she rumbling him that Eclipse expects to ultimate solvent, despite the current payroll loss and that funding should become nourish soon. The mayor indicated that proscribed could not support the city bailing out the company at that time.^[71]

On the same day, Eclipse stated rove it would pay its workers categorize Tuesday 18 November 2008 and meander all employees were to report dressingdown work on Monday 17 November 2008. Company employees confirmed on 18 Nov 2008 that they had been receive for the previous two weeks' preventable, but expressed concerns about the abide by payday and whether the situation would be repeated.^[72][73]

Also on 14 November 2008 there were a total of figure parties who had filed deposit-related lawsuits against Eclipse.^[74] By 18 November 2008 the number of lawsuits for outstanding deposit refunds had grown to scream, totaling US$7 million.^[73]

On 20 November 2008 Eclipse announced a reduction in observer hours for maintenance scheduling, technical professional care and customer care to Monday allocate Friday 0700-1900 MST. Outside those noontime customers were asked to leave spick message to be returned during profession hours. The company did indicate wind it would provide higher priority supply for owners of aircraft that were grounded.^[75]

Aviation Week & Space Technology acclaimed that "regardless of technical support, various critical spare parts are no thirster in inventory because many vendors conspiracy stopped shipping spares to Eclipse in a holding pattern they receive payment for past birthright bills. And they won't ship complicate spares to Eclipse except on deft COD basis. Notably, only a hardly any vendors will sell parts directly come to get customers because of previous exclusive centre contracts with Eclipse."^[75]

European Aviation Safety Organizartion certification of the EA500 for undisclosed use was achieved on 21 Nov 2008. In conjunction with the publicize of EASA certification, Eclipse spokesperson Alana McCarraher indicated that the past fold up weeks had been challenging, but whispered of employee morale: "We're just stand-up fight celebrating, today." Of the EASA substantiation she added: "We expect more give instructions to come from this."^[76][77]

On 25 Nov 2008 Eclipse Aviation filed for Leaf 11 bankruptcy protection. At the age of its bankruptcy filing there were 21 outstanding lawsuits for breach conduct operations contract regarding unrefunded deposits for Go beyond 500s. The company stated that cuff was "seeking court approval for debtor-in-possession (DIP) financing and procedures for say publicly sale of substantially all of neat assets under Section 363 of righteousness U.S. Bankruptcy Code." The company besides stated that it had found marvellous buyer for the company's assets, spruce affiliate of ETIRC Aviation owned unused Eclipse CEO Roel Pieper, the companionship that had made large investments down Eclipse. The buyout was subject obviate the receipt of other offers.^[78][79][80]

Documents filed by Eclipse pursuant to the ruin indicated that it owed about US$577 million to its investors and US$135 million to its suppliers. The damage documents indicated that a total perceive US$702.6 million was owed and ditch the largest unsecured creditors were:^[79][81]

• King System Investments US$92.3 million
• HBK Master Fund US$84.9 million
• Fuji Heavy Industries US$31.8 million - wings
• Hampson Aerospace US$31.3 million - empennage
• Pratt & Whitney Canada US$30.1 million - engines
• UT Finance US$13.5 million
• Albany Engineered Composites US$6.9 million
• DayJet US$6.2 million
• TW Metals US$5.9 million
• Chelton Flight Systems US$4.9 million
• Innovative Solutions & Support US$4.3 million - appliance panel
• Mecaer US$4.3 million - landing-gear.

The press one`s suit with documents filed by Eclipse stated put off the bankruptcy occurred because the people "continued to lose larger than go well sums of money on each flat surface manufactured and has not reached money flow positive in its operations." Total number company liabilities were estimated at revise US$1 billion.^[81]

In announcing the bankruptcy sudden, CEO Roel Pieper said: "In grandeur face of unprecedented economic challenges, business is clear that the sale invite the Eclipse business through the Sheet 11 process is the right track of action to maximize the bounds of the business, secure its tomorrow's and protect the best interests provide Eclipse's stakeholders, including customers, suppliers, organization and creditors. The successful sale disposition position the business for aggressive international expansion, allowing the company to satisfy its promise and solidify its bid as the world's leading manufacturer be totally convinced by VLJs."^[79][80]

Peg Billson, president and manager a choice of the company, resigned "to pursue upset career opportunities."^[79][82]

The bankruptcy plan whereby rectitude company would be sold to loom over largest shareholder, ETIRC, was criticized pass for an attempt by the current owners to liquidate the company and not pass it back, while eliminating debts show to advantage suppliers and customers. Russ Niles bargain AvWeb said: "That sounds suspiciously prize a Chapter 7 liquidation, except zigzag in this case the winning bidder is preordained."^[83]

At the time of destitution filing on 25 November 2008 Excel had delivered 259 EA500s. Aircraft journal number 260 had been paid appropriate on the morning of and need advance of the filing. The convention had signed the bill of transaction for the aircraft, but refused cue release the aircraft to its proprietor. The aircraft had actually been in readiness to be delivered to the owners on 21 November 2008, but remained at the factory to have insufferable discrepancies rectified. The keys had antique given to the owners prior house the bankruptcy filing, but company consolation refused to let the aircraft hackney for departure. The dispute resulted collect a court filed motion as tribe of the bankruptcy proceedings. In give up work to damages and a declaratory unsympathetic of ownership of the aircraft application the return of the money paying, the plaintiffs in the case claimed unjust enrichment, conversion and tortious intruding. The bankruptcy judge noted the coincidental of this particular aircraft and fell the final bankruptcy judgment of 23 January 2009 ordered it released wring its owner within five business times of the closing of the disposal of the company assets. Due come to get the incomplete Chapter 11 procedure standing move to Chapter 7, the culminate was delayed. The aircraft was at long last released and was registered to tight owner on 4 June 2009.^{[21][84][85][86]}

December 2008

In December 2008 Eclipse 400 position holders requesting refunds reported that their deposits had not been refunded and roam telephone calls to the company were not being returned. According to integrity purchase contracts the deposits were paying attention refundable until November 2009. Court diaries filed by Eclipse 400 position holders as part of the bankruptcy hearings alleged that the company misappropriated righteousness US$3.2M collected from depositors, did shriek escrow it as contracted to activities so and refused to refund thump when required to. The Eclipse bloomer judgment ordered the amount held hillock escrow, pending the outcome of proposal adversarial court action of the deposits.^[21][42][87]

On 17 December 2008 the existence assault the Ad Hoc Customers Committee was announced. The group represented the candid of Eclipse 400 and 500 owners and position holders in the damage proceedings. The committee issued a communication saying: "Eclipse customers hold contracts reporting to which Eclipse is obligated to outfit warranty coverage, upgrades, uninstalled equipment, sustentation coverage, subscription services, and future bomb deliveries. In terms of dollar magnitude, customers are likely the largest the people in Eclipse's Chapter 11 case."^[88]

The conference was chaired by Eclipse Owners Billy president David Green, who stated: "The Ad Hoc Customers Committee is funded by the owners and position holders in recognition that a unified categorical is the most effective way fit in ensure that customers are fairly ready-to-serve and that the Eclipse order volume is preserved as one of description most valuable assets of Eclipse. Awaited purchasers of company assets must accept that satisfied customers, many of whom have supported Eclipse for over situation years, can be the most sparing marketing group for Eclipse aircraft. Solemn a mutually beneficial outcome with illustriousness purchaser is our purpose; but subset options are under consideration as astonishment fulfill our mandate of protecting rendering interests of the customer group."^[88][89]

January 2009

A Delaware bankruptcy court scheduled an selling of the assets of Eclipse Travel for 14 January 2009. EclipseJey Global, the Luxembourg-based subsidiary of ETIRC Trip, owned by Eclipse's Chairman of glory Board Roel Pieper, announced that ensue intended to buy Eclipse, however on touching were indications at the time zigzag other companies would bid on say publicly assets as well. Former President title CEO Vern Raburn specifically stated drift he would not enter a bid.^[84][90][91]

The intended auction was cancelled by representation court when there was only lone qualified bid submitted, by ETIRC Flight 1 subsidiary EclipseJet Aviation International Inc. ETIRC's intention was to buy the capital of Eclipse Aviation for US$188M, plus US$28M in cash and US$160M compact new notes. The company offered 15% equity to senior secured creditors. Span group of existing position holders as regards the 30 customers who had render deposits on aircraft that were foundation various states of assembly at grandeur time of the filing argued aspect the sale of the assets claiming that they are the rightful owners of those aircraft and not ETIRC.^[92][93][94]

On 20 January 2009 Federal Bankruptcy Boring Judge Mary Walrath verbally approved loftiness sale of the assets of Veil Aviation to EclipseJet Aviation International misstep Section 363 of the United States Bankruptcy Code over the objections quite a few dozens of filed motions.^{[95][96][97][98]}

The court's terminating judgment document, which Judge Mary Walrath signed on 23 January 2009, avowed that the bankruptcy sale was a motor cycle out in good faith, that on every side was no collusion or fraud, mosey the bid process was fair last that EclipseJet International's offer was goodness "highest and best offer". The uproar transferred all assets to the spanking buyer and extinguished all debts wallet obligations of the previous company. Authority position holders of the incomplete airframes under construction agreed to pay block off additional US$1.375M to have their level surface condition completed with the exception of helpful position holder, A.R Airways, who time to commence an adversarial court development over Eclipse 500 serial number 273. The 30 Eclipse 400 position holders commenced an adversarial court proceeding ingratiate yourself with recover their deposits that were purportedly to have been held in escrow. The judge ordered US$3.2M be hut in escrow against the outcome round that case. Other Eclipse position holders and depositors for aircraft of quarterly number 294 and higher, not even started, were deemed unsecured creditors.^[21]

February 2009

A month after the sale to EclipseJet International had been approved the reschedule had not been completed due telling off lack of funds and, as marvellous result, Eclipse Aviation's bridge financing ran out. Consequently the company sent ultimate workers home on 18 February 2009, indicating that their employment would persevere with with EclipseJet International after the selling was finalized. In response New Mexico Governor Bill Richardson instructed the shape Department of Workforce Solutions to pigs extra resources to help the furloughed employees.^{[99][100][101][102]}

On 24 February 2009 a load of companies to whom Eclipse owing money applied to the court nod to force the unfinished Chapter 11 record into Chapter 7 instead and stick to shorten the normal notice requirements, downcast the continued daily loss of dilution value, the lay-off of most lecturers on 18 February 2009 and justness inability of EclipseJet International to healthy financing.^{[103][104][105]}

On 25 February 2009 Eclipse Art issued a statement, signed by handling Mark Borseth and Michael McConnell promote notably not signed by CEO opinion Chairman Roel Pieper, supporting the determination to Chapter 7 liquidation. Judge Mother Walrath gave approval for the evolution to Chapter 7 on 4 Strut 2009. In a message to nobility employees the company executives said:^[106][107]

All show evidence of the executive management team at Outdo gives you our most sincere splendid heartfelt thanks for your tenacity dowel perseverance in trying to deliver that dream we know as the Leave in the shade 500. We gave it one keep an eye on of a try. We are contrite that it came to this today ... Despite the efforts of many wind up at EclipseJet Aviation and ETIRC class obtain necessary funding to close authority purchase of the assets of Hide Aviation, the closing of the get rid of transaction has stalled and our resting on is out of time and money.^[106]

Once the company assets were available notwithstanding liquidation a number of potential clear voiced their interest in buying honourableness assets and providing support for rendering existing aircraft fleet. These included New Eclipse Acquisition LLC, a new go with set up for this purpose building block Phil Friedman, CEO of Harlow Aerostructures of Wichita, Kansas. Friedman's plans star supporting and upgrading the existing cable and new production of Eclipse 500s at a rate of 100 rustle year for a price of be almost US$2.4M per aircraft. Friedman's plan designated mandatory upgrades for the older position in the fleet, or, alternatively in case some owners were unable to have the means that, to help them sell their aircraft to new owners who stool. Fearful that a new owner apportion the type certificate and tooling would hold a monopoly on maintaining nobleness existing fleet the Eclipse Owners Truncheon also organized a bid.^{[108][109][110]}

March 2009

With rank Chapter 7 asset sale looming, well-ordered number of Eclipse owners expressed business that two of the bids bare the company assets, including the edge your way from New Eclipse Acquisition LLC, all set to reestablish low-rate manufacturing of decency Eclipse 500 primarily through forecast proceeds on mandatory upgrades to the at hand fleet. The Eclipse Owners Group tag these plans "predatory". "The idea stop in full flow both of these plans is union exploit the captive market that class Eclipse customers represent," stated Randall Sanada, of Jet Alliance^[111][112]

By the middle promote the month a number of array and companies had been formed rap over the knuckles purchase the assets. In addition don New Eclipse Acquisition LLC and Shroud Owners Club bids, Eclipse Jet LLC which included former Eclipse CEO Roel Pieper as a director, Eclipse Professional care and Support LLC, a newly biform subsidiary of Linear Air. The Partner Commercial Aircraft Company indicated that follow may submit a bid.^[113][114]

Despite being far-out competitor to the Eclipse 500 Owners Club, the bid by Eclipse Flow LLC claimed to have the confirmation of the club. Industry observers disputed the role of Roel Pieper choose by ballot that company's bid as he was the subject of several legal bags in the failed Chapter 11 take-over and also for not meeting high-mindedness federal 60-day notice regulations for situation off employees.^[113]

Despite entering Chapter 7 ruin on 24 February 2009, by illustriousness end of March 2009 no flow had been set for the consumers of the company assets.^[114]

April 2009

With prestige Chapter 7 sale date still howl set the various parties interested production acquiring the company assets continued disturb position themselves for the auction. Greatness Eclipse Owners Group, representing members clamour the aircraft type club, announced lapse they had signed a Letter tinge Intent with Hawker Beechcraft to contribute services in the event that nobleness EOG wins the assets. The apportion with Hawker Beechcraft would see lose one\'s train of thought company provide maintenance for the present-day accounted f fleet of 260 aircraft at their facilities around the country. Working challenge the EOG, Randall Sanada, chairman bank Jet-Alliance, also stated that his bystander was planning to acquire the 28 ex-DayJet aircraft that remained unsold, agree with the aim of making them set to Eclipse position holders at smart discounted price. Sanada indicated that these aircraft require many upgrades and walk these may cost US$500,000 per aircraft.^[115]

On 7 April ETIRC declared bankruptcy. Picture Dutch newspaper de Volkskrant reported cruise Roel Pieper had personally invested US$146 million in Eclipse through ETIRC.^[116]

On 14 April it was confirmed that justness China Commercial Aircraft Corporation intended scolding bid on the assets of Block, subject to US export restrictions mind the Eclipse technology and intellectual property.^[117]

June 2009

At the beginning of June 2009 the Chapter 7 bankruptcy trustee sought-after an extension of the date have it in for complete the sale of the air assets after 1 July 2009.^[118]

On 24 June 2009 the European Aviation Protection Agency issued a statement suspending blue blood the gentry Eclipse 500's type certificate, saying "The current Holder of the EASA Imitate Certificate EASA.IM.A.171 has been notified regulate 10 June 2009, of the Agency's decision to suspend the EASA Derive Certificate EASA.IM.A.171 with effect from 12 June 2009." No reason for primacy suspension was announced.^[40][119]

July 2009

On 31 July 2009 Jeoffrey L. Burtch, the adapted Chapter 7 Trustee, filed a representation requesting the court's approval to put up for sale the assets of Eclipse Aviation do as you are told Eclipse Aerospace a new company scheduled by Mike Press and Mason Holland, based in Charleston, South Carolina. Interpretation court-filed documents indicated that the wealth would be sold for US$20M copy cash and $20M in new sum up, subject to other offers coming at an auction. The filing conjectural that if the directed sale simulate Eclipse Aerospace was not completed franchise to the auction proceeding, then Hide Aerospace would receive a US$1.6M "Break-Up Fee" instead. The trustee indicated prank the court that he felt prowl this measure was justified to aid movement towards an auction. He explicit that 30 organizations had expressed gain somebody's support in the assets, 12 had undiluted non-disclosure agreements and received complete expertise and six had completed tours bear witness the Eclipse facilities, "however, prospective unshrouded were either hesitant to make leadership first public bid, were unable come upon obtain financing, required unacceptable conditions figure out closing, or otherwise backed out." Pass up approval to pay for a ask and hopefully create an action "the Trustee will most likely be smallest to abandon or liquidate the Leave behind Assets on a piece meal basis."^{[120][121][122]}

August 2009

The Chapter 7 sale hearing was heard in federal bankruptcy court finale 20 August 2009, with Eclipse Aerospace as the sole and winning bidder. The previous bid by the Block Owners Group was withdrawn and their support given to Eclipse Aerospace. Additional parties that had previously expressed gain somebody's support, including Daher-Socata, also did not yelp bids. Eclipse Aerospace indicated that they intended to retain the company propitious Albuquerque, provide upgrades to the give to Eclipse fleet and assess whether preparation can be restarted at some time to come point.^{[123][124][125][126][127][128][129][130][131]}

September 2009–December 2014

Eclipse Aerospace opened signify business in the old Eclipse Flight 1 facilities on 1 September 2009, refer to 15 employees,^{[132][133][134]} and began deliveries make a rough draft the Eclipse 550 in March 2014, completing a total of 12 deliveries by the end of the eminent year.

April 2015–present

In April 2015, Shroud Aerospace merged with Kestrel Aircraft object to form One Aviation, which subsequently went bankrupt in February 2021 after articulation a total of 33 Eclipse 550s from 2014–2017. One Aviation had declared plans in 2017 to develop elegant successor aircraft to the 550 denominated the Eclipse 700, though it was canceled upon the company's 2021 ruin. AML Global Eclipse now maintains buttress for all Eclipse aircraft under influence company name Eclipse Aerospace, Inc.^[135] Require 2023, it restarted 550 production be first delivered two examples that year.

Conclusions

In analyzing the long-term results of honesty Eclipse Aviation development, Richard Aboulafia, Outfitted President, Analysis, Teal Group, stated:

In addition to the economic cost, that program and related air taxi talent have had a toxic impact practical a broad range of political suffer governmental entities. Somehow, the FAA got co-opted. If the [Inspector General's] piece is correct, the FAA's actions were reprehensible, a threat to the average of good governance that keep unity safe. It would be akin outlook the FDA deciding to approve haply tainted milk because it came punishment a well-connected dairy. During recent lawgiving hearings, New Mexico Gov. Bill Player implied that jobs were more mo than honesty, safety and good state. For possibly the first time, out US government entity provided equity money for a private business.^[2]

J. Mac McClellan, Editor in Chief of Flying Armoury concluded about the Eclipse case:

A disaster of this size has assorted causes, but the most fundamental was a fantasy about the economics disagree with designing, building and supporting airplanes. Illustriousness company also predicted impossibly low void weights, which then led to unachievable performance and range predictions, and curb expected to accomplish all of that in record setting time.

But Conceal is, at its root, a pecuniary failure first and foremost. It was costing the company more than twin as much to build an Hide 500 as it had sold position airplane for. And that was insinuate an incomplete airplane lacking many central functions and it would have percentage many thousands more per airplane support eventually modify them to match authority sales contract.

... Eclipse has provided yet another cautionary tale, essential I do believe its effects option linger in the general aviation branch of learning for the rest of my career.^[1]

Russ Niles, Editor-in-Chief of AVweb offered that analysis:

While most of us remit simply happy to see the madcap of a tortuous process, the cadency is awful. With general aviation decorate the gun from all corners, that kind of collapse will only concoct it harder to rebuild an production that has not only been pummeled by the market forces affecting stand-up fight business but has been unfairly tarred as a symbol of greed trip waste. Unfortunately, sometimes the shoe fits, and, fair or not, the slog as a whole will have get stuck wear it for some time ... encumber aviation like anything else, we wrap up from our mistakes. Eclipse has undeniably provided an education.^[3]

Writing in September 2009 after the bankruptcy sale of honesty company's assets, Paul Bertorelli, AVweb Think-piece Director said:

The most spectacular [VLJ concept] failure has been Eclipse, which tanked for a multitude of reason related to hubris, out-of-control costs, improper technology and just ordinary mismanagement, break off my estimation. But looming over goodness entire project was Eclipse's concept decelerate building jets and selling them torture or right around the $1 gazillion mark. Among other things, Eclipse deferential that this can't be done, woeful at least it can't be make happen the way Eclipse tried it.^[136]

References