been smoking. For more than a MARKET ANALYSIS decade now, we’ve been hearing rumors about projects from Toyota and Honda that never seem to This is War materialize into real products. There have been vague sightings of intriguing aircraft and reports How Toyota plans to seize the world GA about piston and jet engine market. Cessna and Piper should be projects and now along comes Munro stitching it all together with listening; these guys may be serious. a fantastic theory of how the Japanese view business as war and by Paul Bertorelli quality aircraft from Japanese how they’ll use military discipline companies, says Munro, will drive to take over the world of GA. Cessna is toast, Piper is road kill the U.S. light aircraft industry to Munro is the principal in Munro and Mooney? Fuggedabout it. The ruin in a few short years, paving Associates, a Michigan-based way A. Sandy Munro sees it, the the way to seizure of the real prize: consulting company with expertise established U.S. GA industry has a dominance in business and com- in the automotive and manufactur- couple of years—a half decade at mercial transport aircraft. ing sector. He came up through the best—to reform or face being gutted By the end of the decade and machine tool industry, did a stint by the same people who dominate perhaps sooner, familiar GA as a Ford auto engineer and is a the auto industry, steelmaking and manufacturers in the U.S. might be keen student of the way Japanese machine tools: the Japanese. gone for good, not just flitting in companies do business. He’s also According to Munro’s blueprint and out of bankruptcy or intimately familiar with the work for the 21st century of general downsizing the workforce to offset of famed industrial quality guru aviation, Toyota and Honda—and the vagaries of market demand. W. Edwards Deming who intro- maybe some Japanese companies Munro says there’s still time for duced manufacturing reforms to you’ve never even heard of—are the U.S. industry to respond to and Japan after World War II. Deming poised to come out of the ground blunt the Japanese challenge, but is widely credited with making any day now with aircraft that, only if U.S. manufacturers reform Japan the economic powerhouse while not necessarily revolution- quickly, instituting cost controls, that it is today, its current fiscal ary, will be so favorably priced and manufacturing efficiencies and, doldrums notwithstanding. of such irresistible value that the above all, improved quality. That’s a In a riveting paper presented to used aircraft market will be change we would all welcome but an SAE aviation conference in reduced to a shambles. The we aren’t holding our breath. We’ve April, 2002, Munro sketched out onslaught of inexpensive, high seen hidebound and its name is what he believes will be the general aviation manufacturing. Japanese plan of attack in wresting dominance of aircraft manufactur- Toyota’s proof-of-concept TAA in ing from the U.S. It would be easy flight over California. It’s believed Who Is This Guy? to dismiss Munro as just another to be Lycoming powered but a You might rightfully ask who futurist crank, save for the fact that diesel version may emerge. Sandy Munro is and what he’s Americans who have and are working with the Japanese on aviation projects in the U.S. agree that he may be right. None of them seem to have Munro’s overarching view of Japan’s world conquering ambitions, but the bits and pieces of the puzzle fit together in an intriguing way. Munro believes the Japanese will enter the GA market first with an aggressive presence that will stun the established industry. He says Japanese companies will sell light aircraft at prices substantially below what U.S. manufacturers are currently offering, with compa- rable performance and with fit, finish, quality and customer support comparable to at least mid-priced or luxury automobiles. 26 The Aviation Consumer • October 2002 www.aviationconsumer.com He believes Japanese companies— thus far, Toyota, in our estima- tion—are willing to sell airplanes at a loss for as many years as it takes to rid the market of competi- tion. Given the chronic weakness and hand-to-mouth nature of the U.S. light aircraft industry, we would guess if the Japanese really decide to do this, it’ll be akin to mugging a drunk in a dark alley. Good business sense has never been in surplus supply in the boardrooms of GA manufacturers. Unless it responds forthrightly, Munro gives the U.S. GA industry two to five years after the Japanese onslaught begins. This is War manufacturers in the U.S. (In our This TAA variant appears to be In his paper, Munro says the view, “marginal” fairly describes fixed gear but could obviously be Japanese laugh at Americans not the entire industry, in terms of built as a retractable. Speeds are out of disrespect but because they profitability if not competitiveness.) said to be in the 140-knot range. can’t understand why Americans And when will this happen? just don’t catch on to the fact that Munro says the Japanese like “business and war are a single dramatic introductions at major This is consistent with Munro’s entity.” He describes three kinds of events where all competitors will observation that companies like companies: those that make things be: His guess is Oshkosh at the Toyota and Honda have strategic happen, those that watch things 100th anniversary of powered business plans extending as far out happen and those that wonder flight. In case you’re rusty on the as 50 years. One American engi- what happened. history, that’s 2003. neer told us he was astonished to Ford was one of the latter in the learn that Toyota even has a 200- 1970s when it ceded the small car Is This Real? year plan. “Hell,” he added, “in market to the Japanese because this country, we’re not looking everyone knew there was no profit If the Japanese are about to burst beyond next month.” in small cars. But a couple of years full-blown into the world GA Most of what we know about later, Ford was shocked to see that market, wouldn’t there at least be Japanese companies had bagged a some clues about what they’re up To get its feet wet in aviation, large share of Ford’s market by to? There would and there are. Toyota certified its V-8 Lexus underselling cars of better quality. Although Japanese companies engine as an aircraft powerplant. Munro says they’ll do the same have been extraordinarily secretive It flew in a Malibu and also in a in the aviation industry, beginning about their plans—this is, after all, Rutan-designed experimental. with light aircraft. They’ll do it by war—as Munro contends, a canvassing current and would-be number of U.S. aviation buyers to determine the market’s professionals have and are wants and needs, hiring the best doing developmental work engineering talent around, fielding for the Japanese. All of an army of round-eyed lobbyists to these experts have non- pressure Congress for aviation- disclosure agreements and friendly reforms and exhaustively none we talked to were testing prototypes before rolling willing to go on the record, out the production models. at least in detail. These aircraft will be sold Nonetheless, we’ve automotive style, with showrooms learned enough to reveal at and in-stock delivery options at least some of what may be prices low enough to attract frugal in the works. One executive buyers who wouldn’t normally we spoke to told us Japa- look twice at anything new. This, nese involvement in GA says Munro, will devastate the began far earlier than most used aircraft market in the U.S. people believe, probably and spell the end of marginal GA reaching back to the 1970s. The Aviation Consumer • October 2002 27 www.aviationconsumer.com In reality, will also have Japanese-designed according to one user-friendly avionics similar to insider we spoke what’s found in luxury cars such to, Toyota may as the Lexus. have had no When and how much? Rutan intention of demurred, referring us to Toyota’s producing the Torrance, California headquarters, engine for aircraft which is overseeing the project use in the first with a staff of about 40 people in place. “These the U.S. A spokesman for Toyota companies take the offered no additional detail, other long view. They’re than to confirm Toyota’s interest. very patient. I One source told us Toyota has think they looked committed some 1000 people at it as purely a worldwide to the GA development Oshkosh in 2003—the 100th year of learning experience. They wanted project which, if true, is a measure powered flight—is expected to be a to get some experience in aircraft of its seriousness. As for perfor- major venue for new products. and certification projects,” he said. mance of the prototype, little Look for a Toyota booth. Another engineer involved in confirmed data exists. AINonline the project told us the FV4000 was reported that the prototype cruised Japanese GA activity has come “a great engine, quiet, smooth and at 140 knots with a follow-on through brief glimpses, rumor and FADEC-controlled.” Further, product to deliver 160 knots. At speculation. We do know that Toyota left many with the impres- first blush, this is none-too-impres- between 1992 and 1995, Toyota sion that it’s a reputable company sive but speed may only be part of funded an engine research project to do business with.