By Frank Joseph Rowe & Craig Miner
Copyright 1994, The Wichita Eagle & Beacon Publishing Company
Chapter 7, Changemasters
Chapter 7, "Changemasters", covers an era (1963 – 1980) characterized by drastic, industry-wide financial hardships that brought about changes for Kansas aircraft companies.
Initially, the early 1960’s remained an up-beat market with high General Aviation deliveries. It was a time when a maverick aviation visionary named Bill Lear came to Wichita and adapted design elements of the Swiss P-16 Fighter Jet to build the legendary Learjet Model 23. Bill Lear built a business jet of such performance and appeal that the public would use the name "Lear Jet" interchangeably with the term "business jet". Beech Aircraft would develop such models as the Baron, Debonair, Queen Air and it’s stately King Air line of aircraft to name just a few. Cessna also was extremely successful in expanding it’s stable of aircraft with a variety of piston twins, turboprops as well as debuting the Cessna Citation series of turbofan business jets. It was a time when Jim Bede designed and developed the BD-5 series of pusher-prop and jet powered micro aircraft (primarily offered to the public in kit form. Alon Aircraft of McPherson, Kansas built the Alon Aircoupe.
Prior to roughly 1969, it was literally the best of times for Wichita’s premier aircraft manufacturers. Cessna Aircraft was hard pressed just to maintain it’s schedule to ferry new aircraft for distribution to regional dealers and customers. All of this would dramatically change for the worst due to a witches-brew of financial obstacles. The recessions of the early 1970’s and the economic perils of the early 1980’s would impact the manufacturers to an extent that has lingered through the turn of the century. High interest rates, rationing of bank loans, termination of defense contracts and high prices of aircraft brought in part from tighter certification requirements were the culprits of the early 1970’s. Temporary relief to the recession came in 1972 that lead to manufacturers rehiring laid-off workers. Incentives stemming from the Government’s "Investment Tax Credit", effects from the "Airline Deregulation Act" of 1978 and increasing subcontracts bolstered the industry. However, this was short-lived as a new wave of financial challenges would rock the aviation sector. The "Tax Equity & Fiscal Responsibility Act of 1982 (TEFRA) levied tax on General Aviation fuel (from 4 cents to 12 cents/gallon, staggering Increases in product liability insurance for manufacturers and additional termination of defense contracts caused manufacturers into a "survival mode". Massive lay-offs and the temporary halt to producing lower-end models of aircraft were put into effect.
In spite of the hardships, the changing economic climate was also a stimulus. Industry wide, crisis was seen as a challenge to evolve marketing, manufacturing as well as overall business process into a much more efficient means to sell aircraft. The following decade of the 1990’s would see Kansas aircraft manufacturers benefit from the "lesson’s-learned" of the prior years and develop into a much leaner and focused business.