PRIVATE PLANES ON THE RISE

THE headline makers of the U.S. air world are supersonic fighters, jet bombers and transports. But today, almost unnoticed amidst the sonic booms, a second segment of the industry is enjoying a rise of unparalleled proportions: the private-plane industry, which is riding the jet stream of its own $1 billion boom.

The U.S. private aviation fleet has soared to 66,000 planes, more flying machines than the combined air forces of both the U.S. and Soviet Russia. Last year alone, 18 light-plane makers added another 6,000 craft to the fleet, and grossed a record $125 million for an 800% gain since 1951. Gas, oil, maintenance and other costs for 209,000 private pilots who fly for fun or profit added $800 million more to the business. Yet the boom is just beginning. The forecast for 1975 is a fleet of 105,000 planes logging 25.8 million hours annually.

From Bust to Boom. What makes the growth even more spectacular is that the private-plane boom started off with a loud bust. During World War II so many young Americans learned to fly that small-plane makers saw visions of a U.S. on wings, flying for the sheer sport of it or touring the country in planes instead of the family car. In one heady year, the industry made 34,568 aircraft, seven years' normal production, and collapsed the market. Sport flying proved too expensive, and touring by plane found little appeal. By 1948 production was down to 7,039 planes; three years later it was hedgehopping, with only 2,279 units worth $14 million. Many companies went broke. Many others turned to outside lines--farm machinery, industrial tools, even pie plates--to survive.

The power behind today's boom is a completely new approach to private flying. Instead of designing planes for pleasure, the industry designs them for work. "Utility" is the new watchword. With rugged aircraft to match every purpose and pocketbook, the industry has made it highly profitable for many a company--and thousands of individuals--to take to the air (see color pages). Big farmers and ranchers, such as Idaho's R. J. Simplot, who needs three planes to supervise his many farming operations and other interests, are learning that they cannot get along without planes. Using them to patrol fences, herd cattle, seed wheat or spray cotton, U.S. farmers are adding many millions annually to their income. As an invaluable tool of industry and commerce, light planes also add millions more to the U.S. businessman's income.

Companies are discovering that one executive on wings is often worth three at a desk. The time alone that a $100-a-day executive can save frequently pays the cost of a plane; a job that would ordinarily take two days now takes only one. Top brass are not the only gainers. Salesmen cover more ground, land more contracts; engineers and troubleshooting supervisors can move around faster. Beyond ordinary personnel transport, private planes are invaluable to rush delivery of critical orders, speed repair parts to outlying plants, or perform any other task where time is the vital factor.

Many U.S companies hesitate to talk publicly about their growing air fleets. They fear that stockholders might think the planes are used only for junkets and fishing trips. But few companies will buy, and fewer plane makers will sell, a plane unless it adds to the customer's profit. Eastman Kodak, U.S. Steel, International Business Machines, Firestone Tire & Rubber, Socony Mobil Oil Co and Texas Co. all have fleets ranging from puddle jumpers to four-engined DC-6Bs and turbo prop Vickers Viscounts. They find them worth their cost many times over in shuttling men and equipment around their widely diversified operations.

Some other big and little customers who fly for profit:

P: General Motors' President Harlow Curtice, whose company runs its own airline with 18 planes logging 7,000 miles daily; Curtice has one plane at his disposal at all times, averages two trips weekly to G.M. operations around the U.S.

P: Independent Texas Oilman William R. Goddard, who logs 400 hours annually inspecting his wells, and says: "Time means money, and I try to save all I can."

P: Varner Steel Products' President R. G. Varner, who bought his first plane five years ago to spread out from Pine Bluff, Ark., selling his company's light steel pipe and other products. Says he: "In 1952 we did a gross business of $218,000. This year we are doing a gross business of almost $1,000,000, and we have extended our work into Canada, Pennsylvania, Ohio, Kansas, Texas and Virginia.

P: Weyerhaeuser Timber Co., which is able to evaluate insect damage in 1% of the time previously required. Weyerhaeuser is now moving into helicopters to reseed forest areas faster and more economically than before.

P: Magnolia Petroleum Co., which has 14 planes, recently flew a team of fire fighters with full equipment from Dallas to a burning well in southwest Texas, got them there hours faster than by commercial airline.

P: Magnet Cove Barium Corp. (Magco-bar), one of the world's biggest dealers in drilling mud, which uses aircraft to fly its "mud doctors" to out-of-the-way sites around the U.S. It has found that one man in a light plane can do the work of eight in cars or aboard boats, and the time saved often means keeping a valuable well from being wrecked. Magcobar's fleet: 17 planes, mostly float-equipped, which flew 7,200 hours last year at a cost of $144,000, far less than the business they brought.

The Leaders. The Big Three of the private-plane industry are Cessna Aircraft Co., whose President Dwane Wallace is called the "Henry Ford of the light-plane business"; Beech Aircraft Corp., whose President Olive Ann Beech is the only woman to boss a big plane maker, and Piper Aircraft Corp., whose President William T. Piper is the dean of the industry at 77.

The Detroit of the small-plane industry is Wichita, Kans., where the two biggest companies--Cessna and Beech--account for 70% of all the dollars spent on light planes. Between them, they offer customers twelve different models, priced from $7,000 to $210,000. Beech concentrates mainly on higher-priced planes, while Cessna rules the middle and lower brackets. And though Beech leads in total business, with 1957 sales of $104 million (66% military), Cessna is the world's biggest private-plane builder, with commercial sales of 2,489 planes worth $33 million (total sales: $70 million). First-quarter fiscal 1958 sales: a peacetime-record $20.7 million for Cessna, a near-record $20.8 million for Beech. Just below Beech and Cessna stands the third member of the Big Three: Piper Aircraft of Lock Haven, Pa., which concentrates on low-priced planes and whose ubiquitous Cub is known the world over. Piper's sales: a record $26.6 million in 1957, but down slightly in igsS's first quarter.

Beech and Cessna might be one huge company today were it not for a personality clash between Walter Beech, a Tennessee farm boy turned pilot, and Clyde Cessna, another farm boy from Kansas. The two started off together, formed Travel Air Co. in 1925 with Cessna as president, Beech as sales manager. But after building two types of planes, one of which was the first commercial aircraft to fly the Pacific to Hawaii, Cessna went off to form his own company. Beech merged Travel Air with Curtiss-Wright and later, in 1932, formed his own company.

Pilot Beech's only trouble was making a profit: he was no financial man, left most of the details to his wife Olive Ann, and the company barely kept aloft. Cessna had even deeper problems. In the Depression he had to close his plant. What saved the company was Cessna's nephews, Dwane and Dwight Wallace, one an aeronautical engineer who once worked for Beech, the other a lawyer. By sweet-talking creditors they reopened the plant, and, though Clyde Cessna sat as president until he retired in 1934, the man in charge was Dwane Wallace, then only 23.

Right Plane, Right Price. He kept the company in the air, but it was shaky flying. Cessna had only $3.97 in the bank when it got the first World War II order for its T-50 trainer, went on to produce 5>359 by war's end. Beech, with a bigger, six-passenger Model 18 transport-trainer, made 7,400 units and millions in profits from every branch of the armed forces. With peace both companies faced some agonizing reappraisals. Beech wanted to merge with Cessna. Dwane Wallace refused, doggedly set about finding civilian markets once it became crystal-clear that the day of the flying flivver had not yet quite arrived.

Beech and Cessna have learned that the U.S. businessman will pay handsomely to fly the right plane at the right price. Under President Olive Ann Beech, who took over when her husband died in 1950, and Vice President Jack Gaty, who runs the operating end, Beech's line starts with its famed single-engined Bonanza ($25,000), goes up to a far fancier Twin-Bonanza at $88,000, and ends with an eight-passenger peacetime version of its wartime D18, which costs $125,000. This year, like its competitors, Beech will try to fill in the chinks (see box).

"Across the Street." The company everyone is watching is what Beech calls the "boys across the street." Cessna's President Dwane Wallace has built a young, eager outfit with plenty of stress on foresight and imagination. At Beech, less than half the executives are pilots; at Cessna, everyone down to middle-management level knows how to fly as well as sell.

While Beech still sticks to relatively high-priced planes, Cessna is moving all around, adding new planes to complement its five single-engined models ($9,000 to $16,850) and its twin-engined Model 310 ($60,000). In the future Cessna hopes to shine even brighter. One important project is Cessna's YH-41 light helicopter, now undergoing tests for the U.S. Army; eventually Cessna hopes to develop a vast commercial market. A second is jets. Last week Cessna landed another $10 million Air Force order for its 400-m.p.h. twin-jet T-37 trainer, booking production solidly for two years. When Wallace decides that U.S. businessmen want a jet, Cessna will be ready.

At the other end of the price range stands Piper, now run largely by the three sons of President Bill Piper. A successful oilman who made his stake in the early Pennsylvania fields, Bill Piper Sr. started business in 1929 and, like his colleagues, often wished, as he almost went broke, that "I'd never gotten into this aviation business." Yet today, with three modern versions of its Cub plus its $34,990 twin-engined Apache, Piper is solidly in the black and ready to expand.

Push from the Bottom. The Big Three's progress and profit is not lost on the dozens of smaller planemakers, who are also learning to grow by selling utility. In barely six years, Oklahoma's Aero Design & Engineering Co. has leaped to a $12 million annual business with its high-priced ($89,500) twin-engined Aero Commander. When the Air Force bought 15, including one for President Eisenhower, so many companies jumped in with orders that Aero expects to sell about 120 planes this year, has built a $6,250,000 plant to boost production. Prospects are so good that even big military planemakers are moving into the market.

Yet for all the activity, the U.S. light-plane industry thinks it has hardly started to climb. Surveys show that there are at least 150,000 potential customers who could gain by flying their own planes. The Civil Aeronautics Administration is already beginning to worry over how they will all fit into the crowded air. So far, the businessman's safety record is good, with only i.i fatal accidents per 100,000 aircraft hours v. a rate of .73 per 100,000 for scheduled airlines. Yet, as more and more planes go aloft in all weather, it may get to the point where the nation's airspace must be sectored off like superhighways, one lane for private flyers, another for airlines, and everything run under strict instrument rules.

This file is automatically generated by a robot program, so reader's discretion is required.