Cheap executive jet coming; will idea fly?

SCOTTSDALE, Ariz. -- Readers of Popular Mechanics back in the 1950s would be surprised to learn that, here in 2000, people are not ferrying from city to city in their own flying cars.

But a group led by a former Microsoft Corp. executive, Vern Raburn, and backed by investors including Bill Gates, is trying to turn some of the sci-fi vision into reality. They're designing a new jet called the Eclipse that they say will be so cheap and easy to use that it could be like an "air limousine," at least for top executives and the very wealthy.

What is unusual is that many analysts give them a chance of pulling it off.

A well-established aerospace manufacturer, closely held Williams International, is designing the jet and its new engines. At $775,000, the Eclipse is priced at just one-quarter that of today's cheapest business jets. Initial estimates show the planes could carry five passengers 2,000 miles at an operating cost of $2,000, less than the typical full-fare commercial airline ticket.

"There's an element of the fantastic about it -- sort of 'Dad, can I have the keys to the Autogyro?'" said Richard Aboulafia, director of aircraft consulting at the Teal Group in Fairfax, Va. "But a lot of businesspeople are really sick of traveling publicly these days, and not everyone can afford a real business jet. Who knows? They might be on to something."

Raburn, 49, admits he is taking a gamble.

"There's an old adage in aviation: The quickest way to make a million dollars is to start with

5 million," he said. Even Learjet Corp., one of the few successful aviation start-ups during the past 50 years, has had five owners and faced three bankruptcies, he noted.

Raburn has been a pilot since age 17 and collects vintage World War II planes, but spent his entire career in the high-technology industry. He was one of Microsoft's first employees in the 1970s and later served as chairman of software maker Symantec Corp. His last job was as president of the Paul Allen Group, overseeing high-tech investments for the Microsoft co-founder.

At a 1997 air show in Oshkosh, Wis. -- an annual event known as the Woodstock of the aviation industry -- Raburn saw Williams demonstrate a prototype craft called the V-Jet. The craft's engines, built with the help of a NASA grant intended to make jet-powered planes more widely available, were just what Raburn needed.

"You have to have the breakthrough engine, and we have that in the EJ-22," he said.

After meetings with Sam Williams, chairman of Williams International, the company agreed to design the new craft under contract to Raburn's start-up, Eclipse Aviation Corp. of Scottsdale. The first delivery is planned for 2003.

Raburn has raised $60 million of the more than $300 million that his company will need from wealthy investors, including Gates, cellular-phone pioneer Craig McCaw and former Ford Motor Co. Chairman Harold "Red" Poling, who is the company's chairman.

The essential advance of the Williams engines is the thrust-to-weight ratio, which the company boasts is the highest of any commercial turbofan engine ever. Each engine weighs 85 pounds yet generates 770 pounds of thrust, allowing the construction of a lighter, cheaper and more fuel-efficient plane.

At less than $1 million, the planned cost of the Eclipse compares with about $4 million for the nearest entry-level business jet, the Citation made by Textron's Cessna unit. A similar plane, the King Air made by Raytheon's Beech unit, costs $3 million, said Michael Boyd, president of the consulting firm Boyd Group/Aviation Systems Research Corp.

The Eclipse might not have the glamour of other business jets. Design photos show a squat, snub-nosed craft whose interior is closer to a "nice Mercedes" than the "Barcaloungers and pool tables" atmosphere of a top-of-the-line business jet, Aboulafia said.

Indeed, selling the new planes might be a bigger challenge than designing them. Eclipse will need to sell several hundred aircraft a year to make a profit, Raburn said. In a good year for business jets, about 500 are sold -- and in weak years such as 1991, the figure has dropped to 200, Aboulafia said.

"What they're proposing is a paradigm shift, a major change in the way people fly," he said. "They either revolutionize the industry or they join the club of failed aviation start-ups."

Raburn is undeterred.

"The initial response will be 'That's cute, but it can't be done,'" he said. "We're making a very big bet here. If we can get the price and performance we're expecting, the market will expand."

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