Recent manufacturing resource and supply chain constraints have resulted in delays to the production and delivery of many parts delivered in RV aircraft kits. These issues and constraints have hit each of our business partners as well as our company directly. As a result, our ability to deliver kits on originally planned schedules has been affected. Van’s is currently in the process of refactoring our plan/schedule for both internal and outsourced manufacturing.
We expect to issue revised lead times for most “standard-build” kits currently on order in the coming weeks. Unfortunately, this means that in some cases we will need to revise the estimated delivery timeframes for customers to whom we had previously communicated a date. Once we have concluded this planning process, we will communicate information about pending kit orders with each customer.
We fully understand this is not what those of you currently waiting on kits are hoping to hear. It’s certainly not the news we wish to be communicating. Please know that our team is hard at work on this, and we look forward to sharing more detailed information about your kit order soon. In addition, we are committed to providing information updates to customers. Regular communications will take place on at least a bi-weekly basis beginning next week.
The most significant challenge both in-house and for our vendors is the ability to expand capacity in the face of supply chain and labor shortages and to meet demand while still delivering quality parts. Demand and orders for our kits grew quickly, to a rate greater than our combined internal and external manufacturing could reliably keep up with. Even as we’ve expanded over the course of the last year, the kit order rate continued to grow and exceed our capacity to produce. We identified vendors possessing the equipment we needed, but those vendors charged highly inflated certified prices that we did not wish to pass on to our experimental aircraft customers. To face these challenges, we have been adding personnel and equipment, and we have expanded our manufacturing partnerships – but all of these additions take time to ramp up and improve manufacturing capacity and lead-time for deliveries.
As outlined in the list below, we are currently taking significant additional steps to increase our manufacturing capacity and build reasonable protection against the types of disruption we’ve experienced recently. These include, but are not limited to:
- Purchasing more floor space and rearranging our factory and warehouses to allow a larger volume of throughput
- Purchasing additional new manufacturing equipment to increase production capacity
- Addition of third-party manufacturing partners to add capacity and redundancy
- Addition of staff and shifts at Van’s to expand internal manufacturing capacity
- Addition of staff and shifts to expand crating and shipping capacity
- Addition of staff related to manufacturing planning and execution
We anticipate being able to execute a meaningful increase in our parts production capacity over the next few months as a result of the combined set of changes currently being made. In addition, we look forward to sharing details of some of the changes with you in communications over the next few months.
An update on Quick Build kits
Quick Build kit delivery timeframes are – as a matter of practical necessity – predicated on a longer lead-time schedule. This is due to the significant number of partner/vendor, manufacturing, and shipping steps that make up the Quick Build production process. We have reviewed previously-communicated crating/shipping dates for customers awaiting Quick Build kits. At this time, we are confident in the lead times we’ve communicated for those Quick Build kits. We will continue to update and revise this information as warranted.
The overall cost of producing Quick Build kits has risen dramatically over the past year, especially in the area of overseas shipping and transportation. We must take these costs into account when planning and determining appropriate prices for transportation and kits. While we always do our best to keep costs down, some external variable costs are outside of our control. For example, the cost to ship a Quick Build fuselage or wing kit from the assembly facility in the Philippines to Van’s has increased over the last year by $2,000 per kit, and container shipping rates are still climbing at this time.
In other news, we recently added a second Quick Build assembly facility in Brazil. We will be receiving the first batches of Quick Build kits from that facility at Van’s starting in January. The expanded Quick Build capacity associated with having two partner facilities will result in reduced risk and shortened lead times as the new facility ramps up its production over the course of the next year.
Our primary goal over the next few weeks is to complete our ongoing planning and to communicate new lead times to you that we have confidence we can meet or beat. Our planning process takes into consideration the real-world impact of recent interruptions and constraints, mitigation against potential future disruption, and manufacturing expansion steps that will enable us to increase the production and delivery of RV parts.