Pricetag Surpasses $2 Million Due To Tougher Economics

Customers attending Eclipse Aviation's 10th Anniversary "E-rrival" gathering in Albuquerque heard exciting news Friday, with the announcement of the Eclipse 400 single-engine jet. That news was tempered somewhat, however, by the disappointing -- though not entirely unexpected -- announcement the pricetag for an Eclipse 500 has crested the $2 million mark.

Effective immediately, new orders for the Eclipse 500 are priced at $2.15 million, in June 2008 dollars. The planemaker blamed the hike in part on escalating costs to produce the 500, many tied to the current slump in the US dollar, and production issues to date.

But there is another reason as well... in Raburn's words, "Eclipse must be profitable in 2009.

"Eclipse's cost-driven pricing model requires Eclipse to re-examine aircraft pricing if actual costs change significantly from projections," he added. "The new Eclipse 500 price has been set based on a number of factors, including higher manufacturing costs and a slower than anticipated production ramp rate. These cost changes necessitated a corresponding shift in aircraft pricing."

Customers who purchased the EA500 at $1.595 and below -- and who have not yet paid their 50 percent price deposit -- will also see a commensurate increase in the prices of their jets. Existing customers will have 90 days to determine whether or not to stay with their current purchase, transferring their deposit to an Eclipse 400 order... or, cancel their order outright, and be refunded their deposits.

Eclipse notes that even with this price adjustment, the Eclipse 500 remains the industry’s lowest-priced VLJ, and is still priced below today's current entry-level jets while delivering fuel burns that are half that of similar VLJs.

When first announced 10 years ago, Eclipse had hoped to bring its inaugural VLJ to market for less than $1 million... but alas, it was a different world then...

FMI: www.eclipseaviation.com