And now this high-value export business, born of a thirst for adventure, is perfectly positioned to take advantage of regulatory changes in the US, writes Terry Shapiro
A little like-mindedness goes a very long way – around the world three times, for starters, not to mention transforming the two-man Airplane Factory into the 400-person Sling Aircraft export operation in 16 years.
Director Mike Blyth and joint CEO James Pitman met at a party … both dressed up as women. They discovered a shared taste for adventure, hard work, irreverence, and the nous to take advantage of market and regulatory conditions en route.
Mike, an engineering student turned serial entrepreneur, was looking for money and enthusiasm to pump into his venture. James, a lawyer with a BSc in physics and computers, was “done with law and looking for something else to do. I wanted not to provide a service of my time to somebody else. I wanted to make a widget and sell it. I wanted to stop being a professional person.
“Mike is an aviation guy and a deep-in-the-gut entrepreneur. He’s had 16 businesses. Three have really succeeded. Another four or five didn’t last too long, and the rest were failures,” James recounts.
“When he was about 30, Mike found himself unemployed. His last business venture had failed. He was going through a divorce, with two kids. And somebody said to him: microlight aeroplanes are going to be the next big thing. So he went and learnt how to fly. By his fifth hour of flying, he was teaching someone else how to fly. A naturally talented pilot, he became the world microlight piloting champion some years later.”
Mike tried various businesses. He worked in the motor industry; he tried to start a trailer-building company. He developed small “rag-and-tube” airplanes with a Ukrainian he met in the competitive flying world, and learnt about designing planes. In the ’90s he acquired the agency for Rotax, the engines that these little planes use. Then in the early 2000s the market changed. Where previously hobbyists built their own planes and bought engines from Mike, they started buying higher-performance planes from Eastern Europe and Australia that came with engines fitted.
The US, meantime, had just created a deregulated light sport aircraft category. Mike decided to exploit that, creating an airplane from scratch. As the local distributor for Rotax, he could sell the motors only in southern Africa. But if he put the engines into aircraft and exported the planes, he could sell the engines all over the world.
He figured he would spend a set amount making the plane, fly it in a year, and then get into production. Two and a half years later he was still slogging away.
James, meanwhile, had a lucky break that permitted him to cast off the shackles of law. A year and two days after he joined a company, it was sold to French nuclear operator Areva, permitting him to exercise share options in it. “For the first time I had some money. One of the things I wanted to do was to make a value-added product in South Africa and sell it to wealthy foreigners. So I joined Mike, 50-50. Put in what he had put in, and raised some finance.
“In the beginning, Mike was the hands-on designer, developer, aviation guy, and I was going to be more the business, finance, and HR guy. But actually, we shared responsibilities.”
When James joined Mike they worked in an industrial park south of Edenvale “with two other guys. We developed our first prototype in a 150m2 space, literally stuck together with duct tape and wire. We had to disassemble it to get it out through the roller door.”
They took it to Springs Airfield and flew it for 42 hours.
“The second one, our production prototype, was put together in 12 weeks. And 11 days after it did its first flight, Mike and I flew it to Oshkosh, in Wisconsin, to launch it to the world.” The Oshkosh air show, run by the US Experimental Aircraft Association, is the biggest of its kind. “That was in July 2009. We flew it round the world. It was such an adventure!”
A friend, Lloyd Ross of Shifty Records, made a documentary about that trip: Two Wings, Many Prayers. It went to a film festival and won a couple of prizes. “We made other films on the back of that one, and those sold a lot of airplanes. It created lifestyle branding around our product that we never really anticipated. We flew around the world because we wanted to fly around the world and have some fun. The airplane proved itself to us … and the world. These films put us on the map. It was quite a lucky break.”
The following year James’s brother Andrew joined them. “He happens to be a marketing guy. And although he actually joined us to help manage our finances, he quickly took over responsibility for marketing and sales.” He’s now joint CEO alongside James.
“We still feel like a start-up, though we are becoming a more mature business,” says James. “As I tell the story, it makes me think about how priorities and concerns change. At the beginning it was: can we develop a great aeroplane? Then once you succeed in doing that, your problem is: can we sell the damn things? And then, once you’re selling them, the problem is: can we produce them? So whatever the problem of the day is, it expands to fill the horizon.”
Sling sells its aircraft in three formats: a fully knocked-down kit, where you buy every part from nuts and bolts to beautifully upholstered leather seats, and build your aeroplane. Then there’s a quick-build kit, which is a 49%-built kit. And lastly there’s the ready-to-fly aeroplane.
“In America we can sell two-seater light sport aircraft. They are in a deregulated category – carry only two people, stall slower than 45 knots, have a single non-adjustable propeller, and must weigh less than 600kg.
“If you build at least 51% of your aircraft yourself, you are entitled to fly it. It’s classified experimental and does not have to be certified. It’s a civil liberties issue, in the same way that in many states in the US you can ride a motorcycle without a helmet or carry a gun.”
The opportunity this created for Sling is set to expand as the US modernises its aviation standards. “Technology is getting better and better. Lots of the experimental aircraft are actually more reliable than the now-aging fleets of certified aeroplanes,” says James. The changes “will make four-seaters constructible on the same basis as these two-seaters. Once everything is in place there is nobody on earth as perfectly positioned as we are to get in there and start delivering products the next day.”
Sling is currently selling three flying two-seater aircraft to the US every month as training planes. “We call them ‘Mac Slings’, a la McDonald’s, because every one is exactly the same as the one before. They’re painted white. They’ve got the same instrumentation. And it’s relatively easy to produce them. Outside that, we sell probably eight kits to the US every month. When the US laws change, we could sell 20 flying airplanes a month to America.”
The operation makes between 16 and 22 aircraft a month, including kits, and delivers them around the world. “And at that level, the business makes decent money. We can afford to pay everybody and find the right people.”
Sling now has 400 staff, in large part based at Tedderfield Air Park, south of Johannesburg. “We started in one hangar, then we were in two hangars, then we were in three, then five … then eight. We still didn’t fit, and we didn’t have a reliable electricity supply, so we moved our parts production – aluminium and composite glass fibre parts – to premises in Alrode.”
Last August Sling took additional premises in Alrode. “For the first time we have a production line there instead of having to push fuselages around and carry half-painted goods from hangar to hangar. We still transport subassemblies on trailers from Alrode to paint and do final assembly at Tedderfield, where we need the runway to test the aeroplanes. Our electrics department’s here, and our R&D.” Ideally, Sling will eventually build a big factory at the airfield.
“We recently developed a four-seater low-wing aeroplane, the Sling 4 TSi. It’s a wonderful marriage of airframe and engine. And because a lot of people in the US like high-wing aeroplanes, we’ve now developed a high-wing version, the Sling 4 High Wing. We’ve taken orders for 240 before even going into production, so clearly our marketing abilities are intact. It’s a lovely position to be in! It will take us at least two years to build those aeroplanes.”
Ordinarily customers pay 50% when they order and the balance when they receive the plane, funding the stock. While the waiting period used be a year, Sling has got it down to about four months with the low-wing aeroplanes. “With the high wings, we take a $5,000 holding deposit, and a 50% deposit when we’re six months out. The deposit on kits is paid three months ahead of delivery.”
It might seem as if Sling is sitting on a mountain of cash, but it’s actually sitting on a mountain of stock. And like any rapidly growing business, it has recently needed to borrow to fund expansion and support the more favourable terms it now offers to the US market. “The classic problem with a business that’s growing really quickly is that it just chews up cash. And we’ve also got a lot of completed stock on the water to our distributor in America,” says James.
Talent pipeline
The company has built its own talent pipeline. “We’ve got quite a mixture of people – four aeronautical engineers, 10 draftsmen, and a small sales and service team.” Almost everybody else is trained in-house and builds aeroplanes, or manages people building aeroplanes.
“Unlike in the motor industry, aircraft assembly, particularly for light aircraft, is hands-on and quite artisanal. Our experience is that the people who have been through the technology training institutions are no better than somebody off the street, so we are in general better off taking a guy who’s got matric and teaching him what needs to be done. Whether he succeeds comes down to his personality and background.” Their high success rate means Sling doesn’t need to take that many trained people, which helps keep costs down.
A number of staff live in Jackson’s Drift, an informal settlement close to the airfield, and walk to work. Others are from Orange Farm and Lenasia, not too far from Tedderfield. “We spend a lot of time and effort making life good for our employees. It’s wonderful to build aeroplanes; they’re an inspirational product. Our buyers send photographs from their farms in, say, Tennessee, on their horses around their aeroplanes, so staff get to see what they have built at work.” James also ensures that staff who have worked on an aircraft have the opportunity to fly in it. Besides the thrill, they get a good sense of the importance of safety requirements and the need to adhere to them.
Sling’s contribution to local employment and to the economy is considerable. About 85% of the high-value finished technology product Sling makes is exported.
Faced down mortality
While Covid did enormous damage to tourism and the wide-bodied jet industry, light aircraft took off. “Our sales more or less doubled. I don’t know exactly why; perhaps while people were sitting at home surfing the net and trying to find something to inspire themselves, some faced down mortality and decided to get on with doing the things they wanted to do in case they never got to do them.”
Historically, Sling Aircraft’s biggest competitor has been a much bigger outfit in the US called Vans. But Vans, after trading for 50 years, was recently placed in business rescue. Pitman looks pensive for a moment. “That might mean we’re now the biggest in the world in our class.”
Regulatory challenges
The greatest obstacles Sling has faced as a business are the inherent complexity of aircraft development, associated regulatory challenges, and lack of experience. “The business was almost destroyed by delays in our regulator providing the approvals we both required and were entitled to. At one point we litigated against them. After we won they tried to appeal – it was ridiculous – but eventually they came to the party.”
So what keeps James awake at night now? “Safety. Aeroplanes are high risk. I also get a little bit nervous about politics in South Africa. But there’s never been an accident that can be attributed to a failure of any of our products, and South Africa is quite possibly the best place on earth to develop and build these aeroplanes,” he says. “Cost ratios are quite low, so it’s a reasonably cheap venue. There are skills available, the regulatory environment for these kinds of aircraft is now more favourable than in other mainstream countries, and the law is good.”
“We are constantly creating new models. Right now the challenge is getting into production of the high-wing airplane. Elon Musk (of SpaceX, Tesla and Twitter fame) says development is not the challenge; production is – to make enough of an article at a high enough quality consistently, at the right price. That’s difficult.
“The temptation is always to get into production a little bit too soon, before you’ve tested everything and have not only the right product, but the right manufacturable product in place. It’s tricky – you need a new production line, you need people, and the product is immature. We’ve tested the product, but we haven’t tested how easy is it to build. Then we’ve got two facelift projects coming up, one for our training aircraft, because they are so in demand – flight training around the world has gone through the roof – and a facelift on the Sling 4 TSi so it is perfectly positioned when the deregulated four-seater legal framework comes in in America.”
When that happens, the regulators are expected also to expand the category of deregulated light sport aircraft to include electric-powered planes. “Because many electric aircraft use multiple engines – quadcopters and so on – they are going to throw in multiple-engine airplanes. It’s very exciting for us, as it appears that we will be able to produce a twin-engine airplane too. That’s quite a development.”
New products
Sling has in addition developed new products on the back of new technology, in particular Rotax engines. “Because of our close relationship with them we’ve been able to house those engines in the perfect aeroplanes more quickly than anybody else on earth. Speed to market matters, carrying capacity matters, fuel efficiency matters. These engines burn car fuel, and are more fuel efficient than your Toyota Prado, say, typically burning 10l to 12l per 100km, but unlike in a car, you travel in a straight line, so do fewer kilometres … at twice the speed of a car, or more.
“We will get into the electric aircraft market when it makes sense for us to do so. ETH University in Zurich, which is one of the world’s leading technology universities, has just done an electric version of our four-seater. It’s one of the first electric four-seaters in the world, and it’s flying in Switzerland at the moment. They have made all the technology available to us, so we have a poker in the fire. But aeroplanes are mostly for going long distances, and the battery technology is not yet good enough for that. They can fly for an hour. They could be used in training aircraft with a hot swap battery, but that’s not so easy to set up. Various manufacturers are working on quicker charging, so the plane can charge while you’re doing your lecture part of the lesson, then fly for an hour.”
James once drove a truck across Africa to London. “People said: ‘You’re going to cross 50 bridges and you’re going to have to rebuild 10 of them.’ I said there’s no way we’re going to rebuild 10 bridges! So we set off and we crossed 150 bridges and we rebuilt 50 of them. If we’d known what was coming we would never have set out. If you want to be an entrepreneur, you’ve just got to take the first few steps and set out. You will fail, but you make adjustments to the business and set out again in a slightly different area. If you try hard enough you will find a model that works. You need a blend of madness and reason.
“Mike’s approach is that if at first you don’t succeed, work harder. But it also helps to choose an industry where you can do well and just make sure you’re better than anybody else at it. Experience, role models and good decisions help too, but there is also an element of luck, and I wouldn’t underestimate being in the right place at the right time, or having the right environment.”
What makes a good entrepreneur? “There is a perennial debate about the extent to which it’s a set of good strategies and skill versus just inspiration. I don’t know the answers, but it seems to be a subtle mixture of a bunch of different qualities, and Mike has those – absolute determination, hard work, a faith in himself like Algerian athlete Noureddine Morceli, who hadn’t lost a 1,500-metre race in three years, and asked about his mental state and whether he had any doubts responded: ‘When I run my mind is full of doubts – who will come second, who will come third….’ You need that attitude if you’re going to be an entrepreneur.
“Mike has a wonderful mixture of practical, theoretical and creativity, and he’s good with his hands. He’s a very hard worker. And he is genuinely both creative and artistic. He’s got a good eye for what looks beautiful, what looks as if it’ll work. I’m quite reductionist. I care more about how well things work.
“We do see things in many ways the same way. We made a film about rock climbing. It was terrifying, climbing up a massive overhang for three days, sleeping hanging overnight. If you can get on under those circumstances your view of risk is probably quite similar. It’s so much more fun doing business as a team! We’ve laughed and we’ve travelled and we’ve had fun, we really have.
“We love to fly. We’re not businessmen who own an aircraft development and manufacturing company, we are pilots who fly, develop and build airplanes. It has contributed massively to making a product that is practical, useful and functional. But that’s just one link in a chain of elements needed to make a business work – if even one of them fails, typically the business fails. You’ve got to be able to finance it, you’ve got to be able to develop a decent product, you’ve got to be able to manufacture and fund the manufacturing, you’ve got to be able to sell it, and you’ve got to be able to support it. So often in the aviation industry there are people who are inspired designers but poor businessmen, or who love aircraft and want to do something that is impractical or unrealistic. We feel we’ve got a decent balance of all of those characteristics.
“We’ve shared just about everything in terms of responsibilities, and it’s worked really well. It’s more fun to do something with somebody else. And two people are always more creative, I think, than one. Plus we’ve had these wonderful adventures, and the opportunity to tell great stories because of them. We’ve had minor differences, but it has been a match pretty much made in heaven.”
