Sender: <marv@lancaironline.net> (Marvin Kaye)
To: lml
Date: Mon, 23 Sep 2002 08:19:25 -0400
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From: "Ted Stanley" <ted@vineyard.net>
Subject: News from Bend and Redmond
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Below are a couple of stories from the Bend Bulletin that I thought everyone
would like to read.

Ted Stanley


Lancair looking for a buyer
Published: September 21, 2002
By Lisa Rosetta
The Bulletin

After several rounds of layoffs and a prolonged search for investors,
Lancair Company of Bend put itself up for sale, and could be close to a deal
with a prospective buyer in a week, according to company officials.

The company's chief executive, Bing Lantis, said Friday that paperwork for a
potential sale would be drawn up within a week.

The company has set a Dec. 31 deadline to complete a sale, and Lantis said
Lancair will likely be back in production by that time.

The news could offer a glimpse of hope for 277 Lancair employees laid off by
the company when it failed to secure $25 million in financing from a group
of investors in New York in July.

When Lancair is bought, Lantis expects the company to remain in Central
Oregon and eventually rehire all laid-off employees.

"It will even go beyond that," he said. "The whole intent of this investment
was to increase our production rates beyond where we were at the time, and
that's going to require more staff."

The company, distinct from Lancair International of Redmond, is in
discussions with several prospective buyers. Lantis wouldn't disclose who
the suitors are but has retained an investment banking firm to represent it
in a potential sale. Lancair is also in the late stages of discussion with
several investor groups. Whether a significant investment would preclude a
sale, Lantis couldn't say.

"I can't answer that because ultimately the board of directors answers
that," he said. "Nothing precludes anything until a document is signed."

While Lancair is simultaneously pursuing a buyer and an investor group, the
company indicated in a letter mailed to its customers last month that
investor money may be difficult to obtain.

"...The current investment climate remains difficult for this type of
private offering," Lantis wrote in the letter. "Recognition of this economic
climate by the board motivated the expansion of the program ... to include
the sale of the company, and we are encouraged by the level of initial
interest from both strategic (aircraft and manufacturers and distributors)
and financial buyer interest."

On June 21, the aircraft maker began scaling back its operations when it
furloughed 47 employees from its Bend location. One week later, the company
laid off another 23 employees, and in July, 207. Prior to that time,
manufacturing had been running at the pace of about one a week, with a
backlog of 172 orders. Customers for those orders put down $28,000.
"I don't anticipate having to make any refunds," Lantis said. "Every offer
for the company we are considering right now will assume all of those
contracts and resume production. We anticipate being able to deliver all of
those airplanes."

The chief executive dispelled rumblings that the company could file for
bankruptcy.
"It is always a possibility, but it is not anything we've considered doing
and I don't see that as an outcome at this point," he said.


Lancair: A tale of two businesses
Published: September 22, 2002
By Kevin Max
The Bulletin

Don't confuse the two. While its Bend-based counterpart Lancair Co., has
been searching for a financial lifeline to maintain its operations, Lancair
International Inc. of Redmond has hit a nice cruising altitude in its own
market.

Lancair of Redmond shares only its industry, name and founder, Lance
Neibauer, with the Bend company. Everything else is separate.

The Redmond company keeps its own financial books, has its own management
team, has its own location and sells kit airplanes to enthusiasts. Recently
the kit company tapped a new market, selling nine planes to the Mexican Navy
for training purposes.

The Bend-based company, however, builds and markets assembled aircraft
certified by the Federal Aviation Administration (FAA), primarily for a
more-tailored business and leisure traveler. This business has been under
intense pressure to find investors to continue operations, which have been
at a crawl since laying off 272 workers in July.

"We take orders for, on average, about 100 airplanes a year," said Kim
Lorentzen, sales manager of Lancair International. "This year's been good.
We'll do close to 100 airplanes, maybe a little less than a 100, but our
sales quotas haven't dropped."

The fallout from Sept. 11 initially cast last year's sales in doubt, but
soon after the public had a moment to digest the state of commercial
aviation, sales roared back. "After 9/11, we heard people saying 'I just
want to fly myself and what can I do to get there?'" said Lorentzen. Last
November, this kind of customer gave the kit plane company a record month.
The company had been accustomed to selling three or four planes in the
typically quiet month of November. Last November, that number more than
tripled to 11 orders.

The kit planes cost about $100,000, depending on the model. That price is
for the kit alone. The engine, the propeller, the instrument panel and
accessories that are not included can cost $150,000 more.

Lancair Int'l manufactures four models, with the new Sentry ($119,000)
making its debut in an air show in Reno, Nev., at the start of September. A
Lancair plane, hitting an average speed of 329 mph, took first place in a
38-mile race of comparable kit planes at the air show. Two more Lancair
planes finished third and fourth places out of a field of eight planes after
placing highly in qualifying rounds.

One pilot racing in Reno that week was Lee Behel, a retired Lt. Col. in the
Air Force. For years, Behel had flown a different model with some mechanical
flaws. This year, Behel bought and raced a Lancair Legacy at Reno.

"I beat all of the similar non turbo 6-cylinder engines," Behel said. "And I
did it with an airplane that is right out of the box. Lancair has an
excellent reputation for building sound airplanes that are well thought
out."

Lancair began its kit business in 1984 in California. The following year,
Neibauer impressed the industry with his first kit plane an air show in
Oshkosh, Wis. In 1991, he moved the company to Redmond Airport. The Redmond
kit business is now composed of four operational units and 52 people.

Lancair manufactures the airplane kit. Kit Components Inc. makes specialized
components for the aircraft, Lancair Avionics Inc. makes the instrument
panels and a sales and marketing division gets them in the hands of
consumers and off the tarmac.

One more thing - because it is a kit, the customer has to put it together.
Don't expect to be flying the day after your purchase. Behel's Lancair plane
took two people a year to build, but he thinks that one man working full
time for a year could build the plane. "That's a fairly short time for a kit
plane," he noted.

Lancair's Web site boasts that a person working 10 hours a day, for 100 days
can put together one of their models. But because kit plane assembly isn't
as easy as the four-step book shelves, Lancair offers instruction and a
workshop with all the right tools for $4,000 a week.