(0:00) Welcome to the BLTNT podcast. I’m your host, Matt Loria, serving up real stories of business, (0:05) life, technology, and transformations. You’ll hear from interesting people about big changes (0:09) from career shifts to life-altering decisions and the innovations that help make it all happen. 

(0:14) It’s about sharing those lightbulb moments, pivot points, challenges overcome, and the journeys (0:19) that inspire us to think differently. If you’re on the lookout for insights to propel you forward, (0:23) stories that resonate, or just a bit of inspiration on your next BLTNT move, (0:27) you’re in the right place. Let’s dig in. 

(0:39) Hello, and welcome to another episode of the BLTNT podcast. I’m here with (0:44) Jeff Simic from RCO Engineering and Aerospace. (0:47) How are you doing? Thank you, Matt. 

(0:49) You’re welcome. Thanks for being here. Jeff’s the general manager and has really been assisting (0:54) your company from going from auto to aero has been the major transition you’ve been working on (1:03) for some time here. 

(1:04) Yeah. The company was started in 1973. Ultimately, from 1973 till about 2008 when I started working (1:12) at RCO, it’s primarily a product development partner. 

Ultimately, we’re a gap filler catalyst (1:18) to getting products to market. OEMs would call, tier ones would call to get assistance. We’re (1:24) essentially skill trades on steroids, ultimately, with a bunch of different assets that can bring (1:30) lots of things to market. 

Eventually, what had happened, in 2008, the idea was to diversify, (1:38) to go from prototype to production. Not too far into that diversification, we also decided to (1:45) become an aerospace OEM, which is a super heavy diversification. Yeah. 

(1:52) Change after change after change. (1:54) Change after change. It’s been a long learning curve, but a good one. 

It’s very interesting. (1:59) Obviously, aerospace has a bit of sexy appeal to it, but at the end of the day, when you’re done (2:05) hanging your hat to go home, it’s still a hefty job. (2:11) Yeah. 

Yeah. Is the company still into prototyping? (2:15) Yep. (2:15) Still into production? (2:17) Still into automotive production. 

(2:18) Automotive, right. (2:19) Yep. About near half of our business now is aerospace OEM. 

(2:23) Okay. You’ve met the mission of the diversification. (2:26) Oh, yeah. 

Absolutely. We’re 15 years old, and I always tell everyone, (2:31) hey, we might get our driver’s license next year in the world of aerospace. (2:34) We haven’t seen the full life cycle yet. 

These life cycles in aero are 30, 40 years long, (2:41) and we’re 15 years into it. (2:44) What was the typical in automotive? Is it a 10-year max? (2:49) Yeah. It’s three to five years of production, 10 years of service, (2:52) and the service isn’t really that difficult to manage. 

You also have to think, in aerospace, (2:58) we’re an OEM, so we’re not even a tier one. We’re the OEM. These seats go onto aircraft. 

(3:03) They have VIN numbers on them. We’re like a mini Whirlpool. We own the spares, the warranty, (3:08) all the service work around the world. 

If you’re a tier one in the auto industry, (3:14) you might not own warranty, or you may, but at the end, you’re still supplying parts for maybe (3:20) 10 years after production, but it’s at a very low pace. (3:23) Let’s explain to people what you’re doing. You had a really great way of explaining this to me, (3:29) is that essentially, people were driving up to their private jets in their Bentley, (3:36) and sitting in a nice cushy seat, and then they’d get on their private jet, (3:39) and it wouldn’t be as desirable of an experience. 

That market was pushing for upclassing the (3:49) seating, correct? Yes. Ultimately, automotive,(3:52) they bring things to market very quickly. A lot of technologies come through automotive. 

(3:58) It’s a self-certifying industry, so they don’t have a lot of heavy… They have regulation, (4:03) but not heavy aerospace regulation. The reality is that the prior seating suppliers, before RCO(4:10) entered the market, were essentially bending aluminum and pop riveting it together, and pulling (4:17) aerospace grade actuation devices and mechanical stuff off the shelf. (4:22) They were out there, but if you’re a designer, and you have to choose from a narrow window of (4:29) products to build this seat, you ultimately are constrained. 

Yes, aerospace did come to Detroit. (4:38) They went to all the major tier one automotive seating suppliers. No one wanted the business. 

(4:45) They recognized that it was a big diversification. They probably would need a heavyweight team like (4:49) we put together. Was it also… They kind of said no because of the quantity, too, right? (4:55) Yeah, quantity, volume. 

Volume is key. Volume is definitely key, but thinking about how do (5:00) you disrupt your business with an aerospace segment in a big automotive tier one. I mean, (5:05) I imagine that. 

Ultimately, I wasn’t there when they were saying no, but they ended up landing… (5:11) They ended up calling one of our… One of the tier ones called one of our sales guys, (5:16) and it just sort of unraveled from there. The reality is we got into this business not knowing (5:23) regulation. In automotive, the OEMs pretty much hold all the regulation. 

They have standard (5:32) specifications that meet all the NTSB regulations that are flowed down from the federal government, (5:38) and wherever else regulations are coming from. In the world of aerospace, it’s not only the OEM (5:44) that we’re supplying to, such as Gulfstream being one of our biggest customers, it’s also the FAA. (5:49) They have regulation they flow down. 

We answer to really two customers. (5:54) Two masters. (5:55) The FAA and Gulfstream. 

(5:58) I just thought it was interesting how you said that this was a… It was kind of an accidental(6:07) endeavor or industry that you kind of flew into or flew into. (6:11) Yeah, yeah. (6:11) There you go. 

(6:12) Good way. (6:13) That you didn’t… You guys weren’t really seeking this out. You were seeking diversification, (6:18) but you didn’t seek out the aerospace space in particular. 

(6:23) No, we hadn’t really. I mean, we… Maybe a little bit. We were doing mock-ups and things for the (6:31) aerospace industry. 

However, we weren’t AS9100 certified, which is the regulation required to (6:38) produce OEM-grade parts for the aero industry. (6:41) Is that an ISO? (6:42) Yeah, it’s an ISO-based. It’s kind of like IETF-19649 for automotive. 

(6:46) Okay. (6:46) It’s very similar, actually. So, yeah. 

(6:51) Great. So, I know when we were talking about this and you were telling me the story, and I said, (6:57) we’ve got to have you on this podcast. You said there was a lot of risk and a lot of reward kind (7:02) of measurements going into all this of delving into Gulfstream and delving into aerospace. 

(7:10) Can you talk about that a little bit? (7:12) Yeah. I think the reality is I don’t know that we understood all the risk. We didn’t. 

(7:17) From a contractual perspective, we signed a 40-page document. I actually came in and read(7:25) the document. I’m like, wait a minute. 

We need a repair station? What is that? FR-145 Repair (7:31) Station. We literally would sit in meetings, and I run meetings on a one-pager. I had my (7:37) administrative assistant put all the acronyms on the flip side, and quietly everyone would go flip (7:43) the page over, and we’d look. 

FR-145. Oh, that’s a repair station, kind of like a- (7:50) Mechanic shop. (7:51) Mechanic shop for cars. 

We’re like, oh, okay. We had to spool that up. We went searching for (7:59) someone that had run an FR-145 in the past. 

We got lucky. We found somebody that’s a great guy, (8:05) still with us today, and is leading our service business. We found him because Spirit Airlines was (8:13) moving all their maintenance to Costa Rica, and he didn’t want to move to Costa Rica. 

He’s like, (8:18) I’m looking for a job. I’m like, you know anything about passenger seating? He’s like, (8:22) well, we take them off the plane. We put them back on. 

I’m like, okay, yeah, come on. It turned (8:28) out to be a great hire, but you have to use your network, every little bit of it. Even if you don’t (8:34) have access to the whole network, you’re finding folks that are- Maybe a little bit more subject (8:42) matter expert than you at the time on the individual pieces. 

Yeah, so there was risk. (8:48) The other side of it is that when you’re building a custom product, everything’s custom. We are (8:53) literally, and I’m not saying this to exaggerate, we are building the Ferrari of seating. 

These are (9:03) the most expensive seats in the world, essentially, single passenger seats. They’re highly (9:09) mechanical, highly over-engineered. They do everything for the client and customer. 

(9:17) We have a lot of custom-grade materials. Every component that goes into these seats are custom. (9:24) That becomes a risk relative to, say, you’re using carbon fiber, and the tow company that (9:31) you certified to decides they want to go make windmills, and they’re done. 

Little old RCOs (9:36) sitting there going, well, wait a minute. We certified our entire platform of seats on (9:41) your grade of carbon. They’re like, well, we’re sorry. 

The next thing you know, you’re out (9:47) chasing down another grade and have to go back to the sled testing and go back to the dynamic (9:52) testing. Those are big bills that you didn’t plan for. There’s risk like that. 

There’s risk in (10:01) probably the economy, but I’ll tell you, RCO diversified into aerospace. Okay, great. (10:10) Not only did we diversify into aerospace, we’re not tier one. 

We’re an OEM. It’s not like we were (10:15) building to print and diversifying. We just jumped right in completely. 

We own the designs, (10:23) the specs, the spec development, all of that. We’re like a little GM in that scenario. (10:28) How did the culture of the organization shift? Obviously, not just from auto to aero, (10:36) but you had all of these other responsibilities coming into play. 

How was culture impacted (10:43) during this time? It’s still being impacted today, 15 years later. Is there an us versus (10:48) them type of thing? The auto guys versus the aeros? No, that’s less and less, but that was (10:53) the beginning. As a company, you have resources, processes, and values that are all the foundation (11:02) of what you’re offering. 

All of a sudden, you say, okay, guys, we’re going to go take on this (11:07) aerospace work. Well, in the beginning, it’s still 90% auto, the stuff that’s coming through, (11:13) and they’re paying customers, and we know who they are. We don’t have a lot of sales activity (11:18) to go get the work, and so your resources are like, oh, yeah, that’s fine. 

That’s aerospace, (11:24) but we got this automotive work. This is what pays the bills right now, too. (11:27) Yeah, paying the bills. 

Then processes, as you can imagine, in a low volume environment, (11:37) the processes that you put into place are probably more tied to humans than they are robots, (11:45) especially with a custom product. We have a couple hundred configurations of seating (11:50) that are involved, and they’re significant configurations. You don’t put these together (11:54) with robots, but in the end, there’s a lot of process from A to Z finance to sales that have (12:03) to be converted toward the aerospace. 

I say sales only because of contract development, and the (12:09) reality is to get a brand-new platform for seating isn’t something like you’re working on (12:15) it for a few months, and you get the job, and you move on. You’re working on this stuff for years, (12:21) so it’s a different mindset shift. You kind of mentioned that to me where you said, (12:26) look, in automotive, if we sign a bad contract, we’re in for four or five years. 

If we sign a (12:32) bad contract in aero, we’re in for some time. Yeah, you’re in it for the full life cycle, (12:38) especially if you’re an OEM. Again, for the audience listening in, if you’re diversifying(12:44) into aerospace as a tier one build-to-print or a tier two build-to-print, the contracts are(12:49) a lot less risky, but when you get in as an OEM, you’re definitely in for the long haul. 

(12:58) The reality is we own the engineering. We have to keep the engineering alive as long as the(13:02) planes are alive until five aircraft are all that’s left in existence, and if you can imagine(13:09) being on Gulfstream platforms, you see a lot of old Gulfstreams out there, and you go over to (13:13) Pontiac. There’s some 1980s sitting out there. 

Harbor Springs, 4th of July weekend, you see a (13:19) lot of Gulfstreams. Yeah, and so we own ensuring that the seats are airworthy. Ultimately, (13:28) we don’t have to pay. 

We get paid to do that, but we have to keep the engineering alive (13:35) for the lifetime of the aircraft so that these things are- (13:39) Until five are left in existence. Yeah, yeah. Now, that’s a contract scenario that we have (13:44) with different customers, but the reality is that’s not necessarily the FAA saying that. 

(13:50) Interesting. Did you guys fund this whole endeavor internally, or did you have to go (13:57) outside for funding to do this? No, we heavily funded it internally. There was a lot of risk. 

(14:04) Ownership played the risk chips on that, and they did really well with it. (14:14) But the customer does, depending on… They also input funding as well, depending on how much of(14:22) it they own and that type of thing. It just depends. 

That’s really actually a very good (14:27) contractual discussion for anyone entering the market, is ultimately who’s paying and (14:34) how much of the intellectual property is owned in the end. And on an OEM seat, what would you say (14:41) the percentage is of the IP that you guys own versus… It’s more of a 50-50 for pretty much (14:46) across the board, everything we do. Okay, got it, got it. 

What were some of the trials and (14:52) tribulations of the whole process here? Well, some of the first tribulations were- (15:00) It’s like on the development side of things. On the development side, we were probably three (15:04) months before we were going to ship our first ship set. We had six or seven ship sets of seats, (15:10) and a ship set of seats is anywhere from 10 to 14 seats, depending on the cabin layouts and whatnot. 

(15:20) So we’re piecing this thing together. And I remember thinking, well, geez, we got to go(15:24) hire some aerospace engineers. And so we started looking around in Detroit, and it’s not like… (15:30) Again, we were building this seat like we’re in our parents’ basement. 

We didn’t know what aerospace (15:34) was going on. And so we ended up having to learn for ourselves what network we could find. (15:42) And we hired an aerospace engineer, the quality engineer. 

And he came into my office one day, and (15:47) he’s like, hey, we usually get an order for each project. In this case, it would have been a ship (15:54) set. And we just order all our fasteners from mill standard fasteners or NAS fasteners, which is (16:02) tied to the aerospace industry. 

I said, oh, he said, but all these ones here, they’re all automotive. (16:09) I don’t know if they’re going to pass conformity with the FAA. And I was like, okay, (16:16) all right. 

Well, this is how we do business, bud. We’ve got these automotive fasteners here. (16:21) We’re fine. 

I’m not kidding you. It wasn’t a month later, and the FAA came through the door, (16:26) and they started messing around and ultimately came into my office, (16:33) declaring that we have an issue with these fasteners. These are not fine. 

(16:36) And I was like, uh-oh. So ultimately, we threw everything in the kitchen sink at it (16:44) and essentially bought Instron Tensile Test Machine, called the Instron Company. They’re (16:49) like, hey, we haven’t made these fixtures in 40 years. 

What are you guys doing? And we’re like, (16:54) nope, we need them. And we started testing fasteners. And the reality was is that (17:02) I think it was something like seven fasteners that had failed. 

(17:05) You said like out of 200, right? So it was a very small percentage. (17:08) Yeah. We had to develop a project for the FAA, and we agreed to do certain levels of testing (17:16) on these fasteners. 

And what’s interesting is we had hardly any mill or NAS spec fasteners (17:22) in these seats. And the reality is that the design engineers, that would have been another (17:26) constraint for them. And they had zero constraints when they went after designing these seats. 

(17:32) And so really, when you think about our competitors, people would come and say, well,(17:36) the competitor could take this business. I’m like, no, they can’t. They will never touch(17:42) this business. 

Or at least the design, I should say. Because they wouldn’t get far out of their (17:53) risk zone. Meaning that they wouldn’t go out of their way to leverage a new fastener versus they (18:00) would just be using the pre-certified fastener, where you guys are certifying your own fasteners(18:05) and saying, okay, now we can use these in the design, which we already have on the shelf. 

(18:09) Yep. So what’s interesting is we now have a whole slew of fasteners we can use, (18:15) which that wouldn’t have happened had we walked into this not understanding regulation. (18:24) So in any event… Meaning if you would have understood… So almost the what you didn’t (18:28) know is actually what helped you. 

Yes. No, that’s… Thank you. What you don’t know can hurt (18:34) you. 

In this case, what you don’t know actually helped you. Yeah. No, absolutely. 

Yeah. So that (18:38) was like an early scenario. But we’ve had lots of challenges that we’ve overcome as a result of not (18:48) knowing. 

Sure. Sure. And now you’re the experts, right? Sorry, you’re the 15, 16-year-old novice (18:56) driver at this point. 

Yeah. But I think we’re gritty enough. We have talent. 

We’re gritty. (19:04) We can certify things. We’ve certified a lot of stuff that hadn’t been in the hands of the FA in (19:11) the past. 

So you have to open up a special project if you’re bringing a new raw material (19:16) into the market. So I feel like the company has the ability and the strength and the exercise of (19:25) bringing new things to market and certifying them. Well, I mean, you had said we’re very much(19:31) vertically and horizontally integrated, right? And from what I’m hearing is you’re really doing (19:39) a lot of insourcing. 

You try not to look to the outside. Was that born out of the, (19:45) we’re in the prototype business, therefore we know we have to kind of make tools, build parts, (19:50) things that don’t exist, and we have to be real gritty and kind of self-manufacturing of so many (19:55) things already. So that kind of that genesis of that attitude is what’s carrying through a bit? (20:02) Yeah. 

If you think about the market we were in in prototype, a lot of it involved seeds. So we (20:08) manufacture foam. We pour it. 

We also mill it. We manufacture sheet metal. Think about a sheet (20:14) metal frame in a seat. 

We do lots of cool things in the sheet metal, lasers and all sorts of cool (20:19) CNC bending and all that stuff. So we’ve grown since the 70s in terms of we have really nice (20:26) assets on ground. Plastics injection molding, obviously that’s a big piece of seeding. 

We have (20:32) a trim department that does ultimately cut and sew activity, but we do just, we don’t do a lot of (20:38) production there. We just do a lot of development work for the OEMs. What else? We had a foundry. 

(20:45) We big into additive. We have additive manufacturing plant. We have an interior exterior(20:50) like super low volume custom paint scenario. 

We have a landing zone where we bring customers in. (20:56) That’s still prototype a lot where we can section off areas of the company and or section (21:01) off areas of that building so that it’s secure and private. And you’ll see in one (21:07) area we’re building autonomous cars for the integrating the technology into autonomous cars. 

(21:14) Obviously in one area of the company, this is all on campus, right? So when we talk about the (21:19) horizontal, we have a lot of manufacturing capabilities that were born in prototype(21:22) that were converted into automotive production and are also now converted into aerospace(21:28) serial production, low volume. There’s not many companies you run across that are IATF 19649 (21:34) and AS9100 and that’s across the board, across all of our factories. What does the campus look (21:40) like? What is the factory layout? We have 11 or 12 buildings, 650,000 square feet. 

(21:50) 12 in gross spec. Anything out of the region or everything else? (21:55) We just had an open house down in Savannah, Georgia. We have 5,000 square feet (22:01) leased down there and that’s going to be a service center for seating. 

We also have a test (22:06) lab out in Plymouth, Michigan. It’s a static environmental test lab that primarily supports (22:13) the auto industry. However, we also do aerospace testing. 

Did you have to add a lot of square (22:17) footage when you added the aerospace in? Yeah, we did buy a building, converted it. (22:25) It’s a light industrial building, about 40,000 square feet. That’s where we build (22:32) our seats and we house the OEM staff if you will. 

Got it. How have you taken all of this (22:39) to market now that you’ve matured? You’ve got this initial client (22:47) or I’m sure there’s more than one. Yeah, we have more clients now. 

(22:51) What’s the go-to-market on that? What do you mean by that? Who are you seeking out?(22:58) For one, all of our plants are AS9100 so they could do build-to-print for (23:08) OEMs or large-tier primes in aerospace. We see growth there and growth is happening there. (23:17) In terms of passenger seating for the business jet world, we are branching out. 

We do have (23:26) some small contracts that we’re working on right now. The Gulfstream is continuing to grow as well. (23:32) They’re the biggest horse in the race when it comes to large cabin business jets. 

If you (23:40) follow General Dynamics who owns Gulfstream, half the talk on the earnings calls is Gulfstream (23:46) right now. They have a lot of growth happening. If you think about it, we talked a little earlier, (23:53) there’s about 25,000 business jets. 

Why don’t we have Jackie, can you bring the (23:59) sheet up that talks about those stats? That’s the one. If you scroll down a little bit (24:07) to the business jet outlook, there’s 24,000 business jets globally. Keep going down. 

(24:14) About 700 delivered annually. I think it pushed 730 last year. That’s worth roughly $20 billion. 

(24:21) If you do a 20-year outlook, that’s a half a trillion dollars. I’m not even putting inflation(24:25) in there. I’m just throwing a quick number. 

Of the 700 business jets produced a year, (24:31) about 200 are large cabin. We live in that space. Gulfstream lives in that space as well. 

They own (24:37) pretty much half the market share. We continue to grow with them. When you’re talking about (24:46) industry, we’re always talking about in industry here in the Detroit area,(24:51) is the diversification. 

So many people are worried about as EVs become more prolific, (24:57) there’s less parts, there’s going to be less need for bodies and people, and we’re going to need (25:02) re-skilling of people. Obviously, just re-skilling of people just for the EV side of things from the (25:07) internal combustion engine. Also, people are looking for diversification. 

You also threw (25:14) up here on this stand here, the global outlook is right here. We’re looking at, if you scroll up, (25:20) Jackie, to the top, just commercial outlook overall is a doubling industry over the next (25:26) 20 years. Absolutely. 

If you look to the right there, the regional highlights is really showing (25:32) you where the growth is happening in passenger traffic. That’s the key indication for commercial (25:41) jet manufacturing. Today, there’s 25,000 jets in service globally, and they plan to produce in the(25:49) next 20 years between Airbus, Boeing, 44,000 jets. 

In the end, some of them are retiring, (25:57) but in the end, we’re growing from 25,000 jets in service today to 50,000 in service in 20 years (26:02) from now. If you look at the value of those jets, it’s worth over $6.5 trillion, and 65% (26:11) of that is spent in the supply chain. Boeing, Airbus, Lockheed Martin, Raytheon, they’re all (26:18) spending money in Michigan. 

We look at this and say, look, we don’t need Boeing to come here and (26:23) make planes in Michigan. We just need to brand Michigan and get more of the parts supply (26:30) and the system supply. We have quite a bit going on here in Michigan. 

That’s maybe another little (26:35) rabbit hole we can get into a little bit later. The reality is, and you look at the revenue tied (26:41) to this thing. We’re entering our service. 

We’re 15 years old, so we’re starting to enter (26:47) the service market where we’re doing maintenance, repair, and overhaul of seating. (26:52) That is a lot of- Can we just explain that for people? (26:55) There are seats that you built 15 years ago that are now requiring service, is the point, (27:02) and that 40 years is the overall life cycle. These seats could require multiple service points (27:08) through the 40-year timeline. 

In the commercial plane, (27:13) they have what they call different checks. It’s all regulated. They’re checked annually, (27:19) every two years, every four years, depending on what system needs to be checked. 

Essentially, (27:25) they’ll end up doing a heavy check at some point, whether it’s nine years, 10 years, or 12 years (27:29) for the first heavy check where they completely strip out the interior, look for corrosion, (27:34) rebuild the engines, all that. The engines are on their own timeline. These are $150 million, (27:42) $200 million jets with $20 million a piece engines on them. 

Some of those things, obviously, (27:50) have large maintenance, repair, and overhaul revenue outlooks. They talk about that service (27:58) model value up there, $4.4 trillion. Over the next 20 years, to keep the planes in service, (28:06) there’ll be $4.4 trillion spent. 

That’s not talking about the $6.5 trillion for the plane. (28:12) Correct. For 20 years of planes. 

(28:16) If you’re advising the high school kid today, what should I do when I grow up? (28:24) There’s a lot of growth happening in aerospace. I could advise the students, (28:32) but I think the big thing for us right now is to advise the stakeholders of the state of Michigan (28:38) to really sink their teeth in this and really peel this onion and understand what it is. (28:44) We figure today there’s about $8 billion of GDP leaving the state of Michigan. 

(28:51) Due to what factors? (28:52) Well, $8 billion in GDP in aerospace for the state of Michigan. We’re a $500 billion GDP state, (29:00) roughly. It’s grown a little bit. 

A big chunk of that’s in the retail of home loans and stuff (29:06) like that, but there’s also $100 billion, let’s just say, in manufacturing. Say $70-80 billion (29:13) of that is auto manufacturing. We have $8 billion that we do in aerospace manufacturing. 

(29:19) Currently. (29:20) Yeah, currently. That doesn’t even include the tooling that’s happening, tool manufacturing, (29:25) which is hard to capture that revenue stream. 

(29:28) Sure. But if we can just use maybe some really oversimplified math, (29:31) if we know that the commercial market is doubling over the next 20 years, we could perhaps (29:37) capture that here or a vast portion of it with our manufacturing prowess. (29:41) Yeah. 

We’re doing that. We spooled up in 2017 the Aerospace Industry Association of Michigan. (29:47) Which you’re involved? (29:48) Yeah, I’m on the board. 

I was a founding board member. I was probably the smaller company on the (29:54) board. GE Aviation, Pratt Whitney, Eaton Aerospace, University of Michigan are all on the board. 

(30:02) There’s a few small companies. Basically, from Jackson to Calumet and UP, we have board members. (30:06) Okay, great. 

We’re going to include, I know, in our show notes and everything, (30:10) we’re going to make sure that folks know how to attend because you’ve got an upcoming (30:15) event here in Michigan happening in September. This is an annual event? (30:21) Yeah, it’s an annual event. This will be our third annual event. 

This type of conference, (30:30) I’ll call it high-end for lack of a better word, but we’re bringing global stakeholders (30:35) with the C-suite stakeholders from Boeing, Airbus, Lockheed Martin, Liebherr, Eaton. (30:45) A lot of big names are coming. Ultimately, these types of conferences typically happen in Seattle, (30:52) Montreal, Singapore, Los Angeles. 

No, we’re bringing it to Rochester, Michigan, Royal Park Hotel. (31:03) Bank of America, Industry Outlook, major players that are involved around the aerospace industry (31:10) are coming here to talk about the industry. We’re exposing Michigan’s strength. 

(31:18) I think it’s a real important event for people to attend that are interested in understanding(31:24) and starting to want to put the pieces together on what’s going on in the world of aerospace. (31:31) The speakers are really good speakers, so they’re good to listen to regardless of the content, (31:38) but the content is really strong this year. We’re opening up with a talent panel. 

(31:44) I’ll be moderating a panel. Dick DeVos is kicking it off because he was founder of the Western (31:50) Aviation Academy, which is at the Gerald Ford Airport in Grand Rapids. (31:57) That’s actually a high school, correct? (31:58) Yeah, that’s a charter high school. 

It’s a charter public high school. (32:04) He’s investing in it because he sees the talent being an issue. Obviously, I’m sure there’s other (32:12) things, legacy and stuff like that. 

He’s kicking it off. Obviously, he’s flying in (32:18) for just a couple hours and taking off. (32:21) That’s just to show his commitment to the aviation business. 

He’s not going to drive (32:26) in for the aviation. We’re doing a really cool talent panel. I travel to a lot of conferences, (32:35) and I’ve seen a lot of agendas. 

This is going to be a really cool talent panel. (32:41) We have the University of Michigan, a professor from the University of Michigan that’s super (32:46) dynamic. We have an F-16 fighter pilot. 

Myself are all leading panels of colleges and high (32:54) schools and universities. We’re even doing a student panel, but Dick’s kicking it all off. (32:58) Then we’ll get into business. 

Talent is on everyone’s mind. It’s the number one issue (33:05) in aerospace. It’s the number one issue. 

I’m sure you hear from folks that you bring in from (33:09) industry. (33:10) Yeah, all the time. We’re just concerned about the talent pool leaving here. 

We’d rather be (33:15) upskilling it than keeping it here. (33:18) This episode of the BLTNT podcast is sponsored by Oxium, business IT and cybersecurity designed (33:24) to outsmart chaos. Empowered by Juniper Networks, automate your network with Juniper Networks and (33:29) the Mist AI platform, the world’s first AI-driven wired and wireless network. 

(33:36) We’ve really covered a lot of what I would… We do business, life, technology, and transformations (33:41) here. I think transformations, you guys have knocked it out of the park. You check all the (33:48) boxes there and talked a lot about business. 

Let’s talk a little bit about life a little bit (33:55) here. We have kind of an interesting fact is that in that chair, well, actually in the chair, (34:01) we had two people in the room when we interviewed them, but you actually went to college with Tom (34:05) Swartz, who’s the CTO at Detroit Manufacturing Systems, who we interviewed just in a couple (34:11) episodes ago. Yeah, yeah. 

No, Tom and I have known each other since, I would say, the mid-90s. (34:18) He’s a fraternity brother of mine at Ferris State University. He didn’t go into plastics, (34:23) but I was in the plastics engineering program. 

I think he was business. I actually forget, (34:29) but nonetheless, so Tom and I, we’ve always maintained friendship. I used to live in Royal (34:35) Oak, and so he did as well, and so we’d always run into each other every once in a while. 

(34:40) That’s a small world. It’s a small B-L-T-N-T world, but tell us a little bit about growing up.(34:46) You’re a Michigan. 

You grew up in Michigan your whole life, and tell us a little bit about that. (34:51) I grew up in Michigan at Playa, Michigan. My dad was an engineer for General Motors, final line (34:57) manufacturing engineer. 

My mom stayed. She would stay at home, and I have two sisters, (35:03) one older, one younger, and they both live up in Fenton. Actually, all the family lives up in Fenton. 

(35:08) I grew up in a farming community, so my mom and dad, when they got out of the Navy, my dad was (35:14) in the Navy. He never set foot on a boat, but he was an aircraft mechanic for the T-28 trainer. (35:22) They had my sister, and they needed a home, and so my uncle gave them an acre lot, (35:30) or sold them for very cheap an acre lot on the farm, and so when I say I grew up on a farm, I did. 

(35:36) It wasn’t my parents, although we helped a lot. It was corn and soybeans, so I grew up in that (35:42) environment. My dad was a big gearhead, so we were always rebuilding a Jeep or built a sand rail, (35:52) always doing something with a muscle car, so I was always out in the barn. 

I was an engineer (35:57) when I was a little kid. From a young age. From a young age, and obviously strong work ethic. 

(36:02) My parents were both pretty busy people. In fact, my dad today, we were up north last(36:09) couple weekends ago, and working on a project, and I’m aligning some stuff and drilling some (36:15) holes, and he’s like, give me that. Give me that drill. 

He’s still 77 years old, and he acts like (36:22) he’s 50. That’s great. I look at him, and I’m like, man, I wish I could slow down, but you’re (36:28) the reason I can’t, and I never will. 

Right. I never will. It’s in your blood. 

It’s in your (36:33) blood, and so I went to Ferris State University, left there, went to … Well, I started working (36:43) in the plastics engineering automotive, so ultimately, I was working for a company called (36:47) Key Plastics in Grand Rapids. That’s where I learned all the manufacturing. I always tell kids (36:51) that are in engineering, if you want to get into the business side of it, you need to get (36:55) on the manufacturing floor. 

No one can ever take away those learnings from you, and I see a lot of (37:03) people that are unsuccessful in their careers because they hadn’t got that experience, (37:10) because ultimately, when you move forward in your career, you’re more respected because you (37:15) know what’s happening out there, and you know what can happen, and you’re listened to a lot (37:21) better than if you just decide to go into just program management or just design engineering. (37:29) Yeah, true, or just academia versus getting the … (37:32) The money’s made on the floor. (37:33) Getting the floor experience. 

(37:35) Yeah, and you could start striking lines on a tube, but every line you’re striking is (37:38) a potential cost, and ultimately, if you come from manufacturing and you start designing, (37:45) I think your legs are … You’re far in front of a lot of folks. (37:51) Sure, sure. (37:52) But yeah, so then from … Yeah, so I worked in auto industry for probably 18 years before I (38:01) went to RCL, which was also automotive before then I got into the … (38:04) And what was your original role at RCL?(38:07) Plant manager of the injection molding factory. 

(38:09) Okay. (38:10) Yep, and the idea was to turn it from prototype to production, which we did,(38:13) so we ended up … We didn’t even have a materials required planning system, MRP. (38:19) We didn’t have ERP. 

(38:21) We had all these orders coming in from the customers, and everything was an Excel spreadsheet, (38:29) and we had to have a contract service pull in the data, and it was pretty … And we didn’t (38:37) have a lot of procedures about process monitoring, and just you name the gamut. (38:41) How did the founders handle you coming in and helping with that transition? (38:47) Again, the prototype world seems very interesting if you’re an engineer, right? (38:53) You get to build it, make it, think about it, whereas when you’re going into the production (38:59) business, you’ve got to be efficient, you’ve got to have every process has to be lined up. (39:05) How did they handle that? (39:07) Was it their idea to do that? (39:09) Yeah, it was their idea. 

(39:10) Purposely bring you in to accommodate that to happen? (39:13) Yep, so it was their idea.(39:16) They were seeing the writing on the wall relative to product development and prototype(39:20) activity because the industry was getting smarter. (39:23) Less and less prototypes were becoming a thing, so a lot of the OEMs were doing pre-production (39:32) tooling and skipping the prototype, and they would prototype off the production tools to (39:37) save money. 

(39:38) And then, of course, later on, in about that time, ultimately, additive manufacturing (39:44) became a thing in the plastics world, and a big piece of our prototyping was plastics (39:48) injection molding. (39:50) So we also invested in additive manufacturing. (39:54) We have quite a few machines that are running nonstop, making plastic components. 

(40:00) Do you do metal additive? (40:02) Nope. (40:03) Or just plastic? (40:04) Nope, just plastic.(40:07) We’ve looked at metal. 

(40:10) I’m sure it might come into place at some point in time, but the business case really (40:13) didn’t support us moving forward with it. (40:18) What else do you think you want to talk about?(40:23) Well, I think the AeroOne conference at Royal Park Hotel, September 4th through 6th, is(40:31) a great place for people to come learn the industry. (40:33) I want to share learnings. 

(40:35) I get up and speak at these conferences. (40:37) Yeah, I would say teaching seems to be kind of a theme, a thing. (40:41) Yeah, so it’s a place for at least me to give back and feel like you can have an impact. 

(40:48) I think everyone wants a diversified portfolio, right, in their 401k? (40:52) You bet. (40:52) The state needs one as well. (40:54) And I think with some of the challenges going on in the auto industry right now, it’s (41:00) important for companies to not feel like… (41:04) The word aerospace is daunting. 

(41:07) When you first think about, well, I want to get in the aerospace industry, it’s a little (41:12) scary. (41:13) But the reality is there are some mom and pop shops out there that are aerospace companies. (41:19) It’s not as scientific as you think, but there is a lot of regulation and you have to sift (41:24) through it and learn through it. 

(41:25) I think come to conferences like this, you begin to network and understand the industry,(41:32) obviously the demand for aircraft. (41:35) This is just the commercial aircraft and business aircraft, but we have demand for rockets, (41:41) demand for satellites, might have demand for mining equipment on Mars. (41:45) I mean, who knows? (41:46) And defense aircraft. 

(41:48) Yeah, defense aircraft. (41:50) This advanced air mobility thing, it has some business case challenges, but eventually it’ll (41:55) work. (41:56) It could flip to a positive business case. 

(42:00) And advanced air mobility is really people, parcel, people or parcel, military or civil, (42:07) rural or city. (42:11) So when you look at potential package deliveries and things of that nature, maybe package (42:16) deliveries in a rural community are going to be a thing. (42:19) Obviously, a drone, electric drone can probably get from A to B quicker in a rural community. 

(42:25) That’s just Jeff’s opinion of it. (42:27) But that’s out there in the future too, and those could have a high volume scenario. (42:35) But there’s a long road before that happens. 

(42:38) I mean, right now, I keep circling back to the commercial jet forecast, and that’s really(42:45) what pays all the bills in the aero industry. (42:48) That’s where all the real developments are happening, I would imagine, too, from the (42:51) technology side of things. (42:53) And it’s critical infrastructure to the country. 

(42:56) It’s also within the top 10 global exports. (43:00) So when we hear about Boeing having troubles, I mean, that’s a real concern for the nation. (43:06) But a lot of the tier ones and primes, they don’t just supply to Boeing, they supply to (43:10) Airbus and Embraer. 

(43:12) So they’re supplying parts globally. (43:16) They might make the planes here, but the parts are leaving. (43:20) Aerospace is fragmented. 

(43:22) Ultimately, it’s very fragmented. (43:26) Automotive, typically, you’ve got an OEM plant producing Chevy pickups, and it’s a (43:30) supplier park, and everyone’s aligned to standards and advanced product quality planning and (43:37) all these systems. (43:38) When you stand back, and I’ve had moments in automotive like, oh my god, we have no idea (43:43) what’s going on in the industry. 

(43:44) But when you stand back and look at automotive versus aerospace, automotive is just cadence, (43:49) cadence, cadence, policy, procedure. (43:53) In aerospace, it’s regulation, heavy regulation. (43:59) And there’s a lot of inefficiencies. 

(44:02) We did talk about that, though, the regulation. (44:04) You’re not seeing a ton of the regulation yet coming your way from the cybersecurity (44:08) aspects of things. (44:10) Yeah, for RCO, we’re talking about it in the boardroom, if you will. 

(44:15) You know, when the stars align and we need to make it happen, we will. (44:20) You know, we have a level of security that I can’t really speak to. (44:26) You know, having you come look at it might be interesting with the company you have. 

(44:31) But, you know, we feel we’re pretty safe at the moment. (44:35) But if it’s commanded that, you know, we need cybersecurity for, you know, handling defense (44:43) data and things of that nature, we’ll make it happen. (44:46) What did you think about the recent issue with the CrowdStrike and Delta and how much (44:53) it impacted their airline in particular? (44:57) Yeah, you know, you think about Delta and how big they are. 

(45:02) And it’s like, wait a minute. (45:03) And they’re often thought of as the, you know, the premium aircraft or passenger carrier (45:11) and passenger airline. (45:14) And, you know, I was taken back a bit by that, that they didn’t have better controls in (45:20) place. 

(45:20) Yeah. (45:21) You know, and but again, it’s not something I follow that often. (45:27) What struck me the most on it was that it was, we call it in our world, we call it (45:31) technology debt, right? (45:32) So when they complained to CrowdStrike and said, hey, CrowdStrike, this is on you, CrowdStrike (45:38) pushed back and said, hey, you haven’t updated your computers in forever. 

(45:41) You’re on antiquated equipment. (45:43) We call that technology debt. (45:44) So they were in deep technology debt, or at least that’s what CrowdStrike is alleging. 

(45:51) That, you know, that made me step back a little bit and go, hmm, that’s interesting to think(45:56) that this premium brand isn’t keeping up on some of the table stakes. (46:00) Yeah. (46:01) And I think this could have some impact to the industry, right? (46:05) A big company like Delta, you know, you think about the impact of Boeing’s mistakes that (46:11) have been aired out everywhere and the Delta mistake here. 

(46:15) And, you know, it does shape the industry, right? (46:18) So I was happy to know that.(46:19) I mean, it was, these were more on the booking side of things than the computers that are(46:22) running the actual airplane themselves. (46:26) But still, I mean, you know, I never even thought about it until you brought it up here, (46:31) about the critical infrastructure piece of it, right? (46:33) How that’s considered, you know, critical in nature, right? (46:37) Yeah. 

(46:37) It’s not just necessarily just an inconvenience. (46:41) It can be a security issue. (46:43) It can be, you know, a defense issue to be able to mobilize our people, you know, where (46:49) we need to move them. 

(46:50) Well, and I’ll tell you, yeah, no, certainly. (46:52) And then, you know, relative to critical infrastructure, I mean, the country, and I have evidence of (46:57) this because I’ve been on some of the committees, but, you know, they’re, you know, the country (47:03) and the legislature is through, like, say, NASA or through, you know, Department of (47:10) Transportation is out looking for where our gaps are, you know? (47:14) And so, like, I don’t know if you heard about the Michigan Maritime Manufacturing Initiative (47:21) that just happened. (47:22) No, no, I haven’t. 

(47:23) It actually didn’t get a lot of news coverage. (47:27) However, I was invited, and the, oh, top NAVY came, and Colonel, and Governor Whitmer, and (47:37) Senator Peters, and they made a big announcement that, you know, the state of Michigan is getting (47:43) money to develop a talent base so that we can make submarines in the state of Michigan. (47:50) Okay. 

(47:50) So the first phase is really a talent development phase, and so they’re asking the community (47:54) colleges and others to step in and develop curriculum, and, you know, and a lot of it’s (48:01) really built around the trades, like the welding, the machining, and things of that(48:05) nature. (48:06) So it’s kind of agnostic, you know, some of the stuff that they’re doing could feed (48:10) other industries as well. (48:11) But, so that was some good news that, you know, the state of Michigan could be a player (48:16) in the defense in submarines. 

(48:19) And I mean, and it makes sense, right? (48:21) I mean, if we’re known as the transportation folks, I mean, maybe that’s the change in (48:27) branding here, from automotive to full-on transportation, whether it’s in the air or (48:32) in the sea. (48:33) Yeah, and I don’t think we brand ourselves. (48:35) You know, I look at a lot of people are, you know, heads of companies are really concerned (48:40) about talent. 

(48:41) I mean, they wake up at night, and this is a significant issue for them, and it has been(48:46) for a while. (48:47) And COVID just exaggerated it, but it really came to light during COVID.(48:52) And it’s not going, this problem’s not going away, you know. 

(48:55) And we oversimplified it when we were talking a little bit before, is just more people are(48:59) retiring than people are coming into the talent pool in those skilled trades to help us(49:04) manufacture these items. (49:06) Yeah, and I would say we, as a state, can argue that we have the highest concentration (49:10) of skilled trades in the country. (49:12) I would imagine so. 

(49:13) And, you know, yes, they are retiring, but you know what, what are we doing about it?(49:18) We have a base, we have a mentor base. (49:20) I’m on the board of FIRST Robotics, which is the K-12 STEM platform, and I’m always (49:25) amazed at all the mentors. (49:27) And they’re typically, you know, folks that are near retirement that are working with (49:32) these students and teaching them everything they got, building this robot and bringing (49:36) it to market. 

(49:38) And I look at that, and I’m like, wow, why can’t we do something like that? (49:41) But take those, you know, near retirement folks and give them an incentive to get back (49:49) into the education and help. (49:51) You know, I think the biggest issue you have is someone needs to release, you know, the (49:57) requirements to be a teacher. (49:59) You know, and I look at, I see it happen in FIRST Robotics, and there’s no requirement (50:04) here. 

(50:05) These kids are just learning from these people. (50:06) And this is a, quote unquote, unqualified teacher. (50:09) In terms of they’re not credentialed as a teacher, I should say. 

(50:13) These kids are learning a lot from those folks. (50:15) But I’ll tell you, like I said earlier, Boeing and Lockheed and SpaceX, they’re all spending (50:23) money here in the state of Michigan. (50:24) And they’re all running ads trying to get our talent. 

(50:27) But at the end of the day, they’re still spending money here because, you know what?(50:30) We do have the trades. (50:32) And I think we need to brand that as a state. (50:34) I really do. 

(50:35) I think we need to come up with, you know, let’s brand ourselves that. (50:39) Let’s call ourselves that. (50:40) Because when you call yourself something, eventually you’re going to be that somebody. 

(50:43) You name it and claim it. (50:44) Yeah. (50:45) And, you know, I think there’s a real chance that skill trades can come back alive. 

(50:49) And I think Michigan can be a bright spot there. (50:52) Great. (50:53) Let’s talk on the little bit of a risk of the manufacturing sides of things. 

(50:58) I have heard that there’s, from a supply chain issue and a security issue kind of together(51:07) here, is that we do have some small and mid-sized organizations that are very key. (51:13) You know, they might be making a bolt or something on that airplane or on that, (51:18) maybe not necessarily commercial. (51:19) Let’s use a defense contractor. 

(51:23) Somebody’s making a bolt for that. (51:25) And a foreign entity comes in and buys the company. (51:29) Yeah. 

(51:29) Right? (51:29) And all of a sudden, now that’s, let’s use China as the example, right? (51:32) That’s a Chinese-owned company now. (51:36) And if we go to war, all of a sudden they get the call from the mothership that says, (51:40) okay, shut down operations. (51:42) And all of a sudden we can’t build jets because of that fastener, that bolt, you know, (51:46) something that’s going into that. 

(51:47) What are you seeing about that? (51:49) Yeah. (51:49) You know, I haven’t ran into that, honestly. (51:53) I get that that’s something that could be real. 

(51:58) I, you know, I hate to say I have faith in the folks that are monitoring this, you know, (52:03) from DC, but, you know, I definitely, you know, I think we do need to secure that. (52:11) And, you know, but I haven’t followed too many stories where that’s popped up. (52:16) You haven’t been seeing it in your world where these three suppliers have been gobbled up by? (52:21) No. 

(52:22) You know, what’s interesting is, you know, so, you know, RCO has internal suppliers, right?(52:27) You know, for our passenger seating. (52:30) We also groomed probably another 60 suppliers that are local here in the state of Michigan. (52:36) So that’s the other interesting thing. 

(52:38) So RCO becomes this OEM, right? (52:40) And, you know, the growth over the last 15 years has been really good in terms of, (52:45) we’re on over 900 aircraft flying around the globe today.(52:48) So just imagine 10 seats in each one of them on average. (52:52) And, you know, so, you know, that just didn’t happen. 

(52:55) And all of RCO didn’t, you know, we had to have a supply chain. (53:01) And, you know, we picked some really nice, we found some really good suppliers. (53:05) And they came along with us in the journey. 

(53:08) And some of those suppliers are now a standing 100. (53:10) Wow. (53:10) So we kept the supply chain local for the most part. 

(53:14) We do have some unique things that we buy in France and, you know, some one-off stuff from (53:18) England and, but, you know, we had to go there because they had the technology(53:24) and we needed it quickly. (53:25) And, you know, that’s, you know, sure how it goes. (53:29) But for everything that, you know, a lot of machine goods, cables, (53:34) oh, geez, you name it, we buy it from the outside. 

(53:37) And, you know, we’ve grown a supply chain. (53:40) You buy it locally for the most part.(53:42) Yeah. 

(53:42) Here in Michigan. (53:43) That’s great. (53:44) Was that purposeful? (53:45) You know, it was, like I said, we were living in a basement when we were developing this thing, (53:50) you know, your parents’ basement. 

(53:51) Oh, you come up every day and be like, all right, who could supply that? (53:55) You look out the window and you’re like, you know, we, you know, it took a bit to build a network (54:02) and, you know, the aerospace industry, one benefit of joining that as a founding board member(54:09) is, you know, I brought a few folks, key stakeholders from the company to go to a lot(54:14) of the events and we found suppliers through attending a luncheon. (54:21) That’s great.(54:22) And started expanding. 

(54:24) And then, obviously, I started learning from the other board members what’s happening(54:29) because they’re legitimately in aerospace. (54:32) I mean, GE Aerospace, Eaton Aerospace, University of Michigan, these people are, (54:37) they know everyone in aerospace. (54:39) And so it was kind of a good thing because I was probably one of the more active board (54:43) members because I had so much to learn, you know, the board member from Eaton Aerospace, (54:49) okay, well, you know, he’s in aerospace. 

(54:52) He doesn’t need a network. (54:53) He’s just trying to, he’s trying to find talent. (54:55) Sure. 

(54:56) And he’s trying to grow talent. (54:57) That’s why he was on the board and pushing the talent initiatives. (55:00) And I was, you know, running around going, okay, I’m just, I’m a sponge, you know, (55:05) but I, we did a lot of work and we’re up to 150 members now. 

(55:10) That’s great. (55:11) That’s great. (55:11) And you told me too that, you know, we hear in all the business books, right? (55:15) Work on the business, not just in the business. 

(55:17) Yeah. (55:17) And you’ve really attributed a lot of your own personal knowledge and corporate success to (55:23) the fact that you’ve been out and getting to know all these people and learning and sponging up all (55:28) the, all the info. (55:30) But, but these relationships have really helped you, helped you build the business. 

(55:34) Yeah, they certainly have. (55:35) We have, you know, I have some contractors as consultants that I ran into that help (55:43) with information about what’s going on in the aerospace industry. (55:48) I call one of my consultants in every once in a while, because I’m like,(55:52) man, we have a real problem here. 

(55:54) And I think we’re really, we’re not on the right track or I think we’re on the track, (56:00) but can you come in here and smell? (56:02) And most often they were like, yep, Jeff, that’s aerospace industry for you. (56:09) High overhead, lots of risk, and you need your margin. (56:14) You need your high margin. 

(56:16) And I’m like, okay, thank you. (56:18) And just those little moments, I’m like, oh, all right.(56:22) I don’t, I feel confident with what we’re doing now. 

(56:24) And when you feel confident, that’s when you excel. (56:26) So, you know, getting to meet and learn from these other stakeholders that have been in (56:31) the business aerospace for 40 years, you know, maybe they’re retiring soon. (56:37) You know, it’s been very helpful. 

(56:39) And any thoughts of becoming a pilot or anything yourself, or have you already done that?(56:44) No, you know what? (56:45) I have ran out of gas a couple of times on the highway. (56:48) Okay. (56:49) And I’m kind of thinking that, you know, I would be like, okay, we’re in the air. 

(56:53) And I’m like, did I check that flap? (56:56) You know, my head’s spinning too much. (56:59) Yeah. (57:00) I’d rather just find another personality to fly me around the earth. 

(57:04) Somebody who’s better at check boxes. (57:06) Yeah, checking boxes and following all the rules. (57:09) Make sure the gas tank’s filled. 

(57:11) Yeah, it was so funny. (57:11) I had a funny story. (57:13) So I was golf streaming called and they were upset about something early on. 

(57:19) And so I had to go into the plant on a Saturday morning. (57:24) And so frustrating. (57:26) I had things to do with the family and all this other stuff going on. 

(57:29) And I, well, you know what? (57:30) I’m a man of my word. (57:32) I’m going to take care of this thing. (57:33) So that’s how I live my life. 

(57:34) And I get in the car and I drive down there to the plant. (57:38) I fix what I needed to fix, get them the data they need. (57:41) And I take off and I’m in the car and I’m still upset. 

(57:45) And I’m on 696. (57:47) And the truck just runs out of gas. (57:49) It was a 2013 Silverado. 

(57:51) So it wasn’t like, you know, ringing at you or pinging your phone. (57:57) And, you know, I’m down in the tunnel. (58:00) And so I get out of the car and I thought, gosh, I wonder if I have the gas can. 

(58:04) Well, I didn’t. (58:04) Oh, yes, I had the gas can for my lawnmower in the back of the truck and it was empty. (58:09) To get gas in it. 

(58:11) Kind of wished I’d gotten gas in it. (58:13) So I’m walking down the highway and just zoom, zoom, zoom, cars going by. (58:18) And all of a sudden this truck pulls over in front of me. 

(58:20) And I’m probably a quarter mile from my own truck. (58:23) And he backs up a little bit and I’m like, man, this guy’s going to give me a ride. (58:27) So I kind of run up there and you could barely hear. 

(58:32) He rolled his window down. (58:33) I could barely hear him. (58:34) Because it’s 696. 

(58:35) Yeah, yeah. (58:35) And I’m in, we’re in this tunnel. (58:37) The walls are 50 feet high. 

(58:39) And he looks at me and he’s like, and I thought, oh, he’s playing it safe. (58:45) He’s pointing to the back of the bed. (58:46) And so I jump up in the back of the bed of the truck and it’s a construction guy’s truck. 

(58:51) And it’s just full of like hammers and wood and old tire. (58:56) And I’m like cleaning the spot off. (58:58) And I’m going to sit in the center of this spare tire that’s sitting back there. 

(59:02) And I put the can in there. (59:04) I sit down and I look at him through the back window.(59:08) I’m like, okay, I think I’m going to get a ride, right? (59:12) So anyways, he stops it. 

(59:14) He gets out of the truck. (59:15) He’s like, no, I meant the gas can. (59:17) There’s a gas can in the back of his car? (59:18) Or he wanted you to put the gas can in there? (59:20) Yeah, my gas can in the back of his truck. 

(59:23) So nonetheless, this guy’s still friends with me on Facebook. (59:26) And we still laugh about stuff together on Facebook. (59:29) I don’t call the guy. 

(59:30) This is great. (59:30) But I’m sitting in the passenger seat now, right? (59:32) And the gas can’s in the back. (59:35) And we’re driving. 

(59:36) And he took me to the gas station. (59:37) And I said, well, what do you do for a living?(59:39) He’s like, well, you know, I’m Nicole Curtis’s construction guy. (59:42) Oh, how funny. 

(59:43) She’s the HDTV, like fix it up girl. (59:47) I can’t remember the name of her show. (59:49) It’s not like fix or flip or something. 

(59:51) Yeah, something like that. (59:52) And we both got a good laugh out of the idea that I was like, well, I guess he’s playing it safe. (59:59) That’s funny. 

(1:00:00) Well, pretty apropos. (1:00:01) My wife called me right before we sat down to do this and said, (1:00:05) I just need to be on the phone with you, (1:00:07) because I’m picking up somebody on the side of the road who ran out of gas. (1:00:10) Yeah. 

(1:00:10) So back to your question. (1:00:12) No, I don’t think flying a plane is in my DNA. (1:00:15) I think that’s a good idea. 

(1:00:16) I’ll sit in the back. (1:00:19) Of the pickup truck or the plane. (1:00:20) Yeah, yeah, yeah. 

(1:00:21) Either one. (1:00:22) Good point. (1:00:22) Yeah. 

(1:00:23) So you’ll probably have no problem flying economy class then, (1:00:26) if you’re willing to sit in the back of the pickup truck. (1:00:27) No, yeah. (1:00:28) And every once in a while, we do get a ride on a business jet. 

(1:00:31) It’s cool. (1:00:32) It’s pretty neat. (1:00:33) It’s nice. 

(1:00:33) A Gulfstream came and picked us up one day. (1:00:35) And the pilots come through the signature station or the place where you pull up and (1:00:42) they wash your car and you sit in a nice lobby. (1:00:45) And the guys are like, hey, have you heard of Buddy’s Pizza? (1:00:49) And I’m like, yeah, we’ve got Buddy’s. 

(1:00:51) We hear it’s the best pizza. (1:00:53) Do you mind if we wait 10 minutes until we just ordered a pizza? (1:00:56) I’m like, no, that’s no problem. (1:00:59) So next thing you know, I’m eating Buddy’s Pizza in a… (1:01:02) In a private jet? (1:01:03) In a private jet flying to Florida. 

(1:01:05) Nothing wrong with that. (1:01:06) I did think it was funny you told me that of the people that work at Gulfstream, (1:01:10) only 5% have ever… (1:01:12) Yeah, it’s… (1:01:13) Is that something like that? (1:01:14) It’s some crazy number. (1:01:15) Low number that have actually flown in a Gulfstream jet? (1:01:19) Yeah. 

(1:01:20) And it is an interesting market because we say we diversified in aerospace. (1:01:26) Then you say, well, you diversified as an OEM in aerospace, (1:01:30) but you’re also diversified in who’s buying your products, (1:01:34) high net worths from around the world. (1:01:36) Sure. 

(1:01:36) So it’s a very unique diversification. (1:01:39) And it’s very interesting to learn, you know, these are social missions. (1:01:44) It’s like, you know, it’s a mission just like, you know, (1:01:49) Lockheed has to put together for, you know, the Air Force. 

(1:01:52) Well, obviously that’s for security. (1:01:54) And we all think that, you know, that’s really important. (1:01:57) And it is, it’s far more important than a social mission. 

(1:02:00) But at the end of the day, these people are paying money for a social mission. (1:02:03) Right. (1:02:04) And, you know, it’s, you know, so, you know, (1:02:08) they’re the end customer and they’ll squawk and, you know, you’ll go fix it. 

(1:02:13) Well, and like you had said, (1:02:14) putting yourself in the mindset of that customer is imperative (1:02:18) because, and you’d given an example of the ice cream. (1:02:20) Yeah. (1:02:21) The ice cream on the flights. 

(1:02:22) Yeah, I’ve been looking at open issues lists on different aircraft. (1:02:28) It doesn’t matter all the, you can get on and see what these issues are. (1:02:34) But yeah, there’s scenarios where the ice cream was too hard. 

(1:02:38) Yeah. (1:02:39) And so that, even though that might not be an issue to you or to those 95% of employees (1:02:46) at Gulfstream, the clientele that they’re serving, that’s what’s important to them. (1:02:50) So it was kind of like I shared with you the mission at Oxium, (1:02:53) is our mission is to help other people accomplish their mission through technology. 

(1:02:57) So we’re here to serve whatever the mission is that you’re trying to do. (1:03:01) And that’s what you said is, you know, these are clients. (1:03:03) This is a social mission. 

(1:03:04) It might not resonate fully with you, not you particularly, (1:03:08) but, you know, that Gulfstream employee or anybody in the supply chain, (1:03:12) but that’s who the end client is.(1:03:14) And what the end client wants is what we’re serving. (1:03:16) And, you know, for the record, I don’t like hard ice cream either. 

(1:03:19) I mean, you put your… (1:03:20) I don’t either. (1:03:21) You spoon in it. (1:03:22) It’s like, wait a minute, you know, you want it nice and a little bit… (1:03:24) There’s a Dairy Queen right at the end of my street. 

(1:03:27) Soft serve. (1:03:27) They’ve got it all figured out. (1:03:29) Well, great. 

(1:03:30) This has been a great time. (1:03:31) Cool. (1:03:31) I’ve been a good time too. 

(1:03:33) I really appreciated you being here. (1:03:34) Yeah. Well, thanks for interviewing me and I appreciate it. 

(1:03:37) You got it. (1:03:37) And the Arrow One Conference, September 4th through 6th at the Royal Park Hotel. (1:03:44) We’re bringing it to Rochester, Michigan, which is super unique. 

(1:03:47) We’re bringing it from major metropolitan area to small town Rochester. (1:03:52) Love it.(1:03:52) For the state of Michigan. 

(1:03:54) Love it. (1:03:54) So great work. (1:03:55) Thank you. 

(1:03:55) Thanks, Jeff.ss, (0:05) life, technology, and transformations. You’ll hear from interesting people about big changes (0:09) from career shifts to life-altering decisions and the innovations that help make it all happen. 

(0:14) It’s about sharing those lightbulb moments, pivot points, challenges overcome, and the journeys (0:19) that inspire us to think differently. If you’re on the lookout for insights to propel you forward, (0:23) stories that resonate, or just a bit of inspiration on your next BLTNT move, (0:27) you’re in the right place. Let’s dig in. 

(0:39) Hello, and welcome to another episode of the BLTNT podcast. I’m here with (0:44) Jeff Simic from RCO Engineering and Aerospace. (0:47) How are you doing? Thank you, Matt. 

(0:49) You’re welcome. Thanks for being here. Jeff’s the general manager and has really been assisting (0:54) your company from going from auto to aero has been the major transition you’ve been working on (1:03) for some time here. 

(1:04) Yeah. The company was started in 1973. Ultimately, from 1973 till about 2008 when I started working (1:12) at RCO, it’s primarily a product development partner. 

Ultimately, we’re a gap filler catalyst (1:18) to getting products to market. OEMs would call, tier ones would call to get assistance. We’re (1:24) essentially skill trades on steroids, ultimately, with a bunch of different assets that can bring (1:30) lots of things to market. 

Eventually, what had happened, in 2008, the idea was to diversify, (1:38) to go from prototype to production. Not too far into that diversification, we also decided to (1:45) become an aerospace OEM, which is a super heavy diversification. Yeah. 

(1:52) Change after change after change. (1:54) Change after change. It’s been a long learning curve, but a good one. 

It’s very interesting. (1:59) Obviously, aerospace has a bit of sexy appeal to it, but at the end of the day, when you’re done (2:05) hanging your hat to go home, it’s still a hefty job. (2:11) Yeah. 

Yeah. Is the company still into prototyping? (2:15) Yep. (2:15) Still into production? (2:17) Still into automotive production. 

(2:18) Automotive, right. (2:19) Yep. About near half of our business now is aerospace OEM. 

(2:23) Okay. You’ve met the mission of the diversification. (2:26) Oh, yeah. 

Absolutely. We’re 15 years old, and I always tell everyone, (2:31) hey, we might get our driver’s license next year in the world of aerospace. (2:34) We haven’t seen the full life cycle yet. 

These life cycles in aero are 30, 40 years long, (2:41) and we’re 15 years into it. (2:44) What was the typical in automotive? Is it a 10-year max? (2:49) Yeah. It’s three to five years of production, 10 years of service, (2:52) and the service isn’t really that difficult to manage. 

You also have to think, in aerospace, (2:58) we’re an OEM, so we’re not even a tier one. We’re the OEM. These seats go onto aircraft. 

(3:03) They have VIN numbers on them. We’re like a mini Whirlpool. We own the spares, the warranty, (3:08) all the service work around the world. 

If you’re a tier one in the auto industry, (3:14) you might not own warranty, or you may, but at the end, you’re still supplying parts for maybe (3:20) 10 years after production, but it’s at a very low pace. (3:23) Let’s explain to people what you’re doing. You had a really great way of explaining this to me, (3:29) is that essentially, people were driving up to their private jets in their Bentley, (3:36) and sitting in a nice cushy seat, and then they’d get on their private jet, (3:39) and it wouldn’t be as desirable of an experience. 

That market was pushing for upclassing the (3:49) seating, correct? Yes. Ultimately, automotive,(3:52) they bring things to market very quickly. A lot of technologies come through automotive. 

(3:58) It’s a self-certifying industry, so they don’t have a lot of heavy… They have regulation, (4:03) but not heavy aerospace regulation. The reality is that the prior seating suppliers, before RCO(4:10) entered the market, were essentially bending aluminum and pop riveting it together, and pulling (4:17) aerospace grade actuation devices and mechanical stuff off the shelf. (4:22) They were out there, but if you’re a designer, and you have to choose from a narrow window of (4:29) products to build this seat, you ultimately are constrained. 

Yes, aerospace did come to Detroit. (4:38) They went to all the major tier one automotive seating suppliers. No one wanted the business. 

(4:45) They recognized that it was a big diversification. They probably would need a heavyweight team like (4:49) we put together. Was it also… They kind of said no because of the quantity, too, right? (4:55) Yeah, quantity, volume. 

Volume is key. Volume is definitely key, but thinking about how do (5:00) you disrupt your business with an aerospace segment in a big automotive tier one. I mean, (5:05) I imagine that. 

Ultimately, I wasn’t there when they were saying no, but they ended up landing… (5:11) They ended up calling one of our… One of the tier ones called one of our sales guys, (5:16) and it just sort of unraveled from there. The reality is we got into this business not knowing (5:23) regulation. In automotive, the OEMs pretty much hold all the regulation. 

They have standard (5:32) specifications that meet all the NTSB regulations that are flowed down from the federal government, (5:38) and wherever else regulations are coming from. In the world of aerospace, it’s not only the OEM (5:44) that we’re supplying to, such as Gulfstream being one of our biggest customers, it’s also the FAA. (5:49) They have regulation they flow down. 

We answer to really two customers. (5:54) Two masters. (5:55) The FAA and Gulfstream. 

(5:58) I just thought it was interesting how you said that this was a… It was kind of an accidental(6:07) endeavor or industry that you kind of flew into or flew into. (6:11) Yeah, yeah. (6:11) There you go. 

(6:12) Good way. (6:13) That you didn’t… You guys weren’t really seeking this out. You were seeking diversification, (6:18) but you didn’t seek out the aerospace space in particular. 

(6:23) No, we hadn’t really. I mean, we… Maybe a little bit. We were doing mock-ups and things for the (6:31) aerospace industry. 

However, we weren’t AS9100 certified, which is the regulation required to (6:38) produce OEM-grade parts for the aero industry. (6:41) Is that an ISO? (6:42) Yeah, it’s an ISO-based. It’s kind of like IETF-19649 for automotive. 

(6:46) Okay. (6:46) It’s very similar, actually. So, yeah. 

(6:51) Great. So, I know when we were talking about this and you were telling me the story, and I said, (6:57) we’ve got to have you on this podcast. You said there was a lot of risk and a lot of reward kind (7:02) of measurements going into all this of delving into Gulfstream and delving into aerospace. 

(7:10) Can you talk about that a little bit? (7:12) Yeah. I think the reality is I don’t know that we understood all the risk. We didn’t. 

(7:17) From a contractual perspective, we signed a 40-page document. I actually came in and read(7:25) the document. I’m like, wait a minute. 

We need a repair station? What is that? FR-145 Repair (7:31) Station. We literally would sit in meetings, and I run meetings on a one-pager. I had my (7:37) administrative assistant put all the acronyms on the flip side, and quietly everyone would go flip (7:43) the page over, and we’d look. 

FR-145. Oh, that’s a repair station, kind of like a- (7:50) Mechanic shop. (7:51) Mechanic shop for cars. 

We’re like, oh, okay. We had to spool that up. We went searching for (7:59) someone that had run an FR-145 in the past. 

We got lucky. We found somebody that’s a great guy, (8:05) still with us today, and is leading our service business. We found him because Spirit Airlines was (8:13) moving all their maintenance to Costa Rica, and he didn’t want to move to Costa Rica. 

He’s like, (8:18) I’m looking for a job. I’m like, you know anything about passenger seating? He’s like, (8:22) well, we take them off the plane. We put them back on. 

I’m like, okay, yeah, come on. It turned (8:28) out to be a great hire, but you have to use your network, every little bit of it. Even if you don’t (8:34) have access to the whole network, you’re finding folks that are- Maybe a little bit more subject (8:42) matter expert than you at the time on the individual pieces. 

Yeah, so there was risk. (8:48) The other side of it is that when you’re building a custom product, everything’s custom. We are (8:53) literally, and I’m not saying this to exaggerate, we are building the Ferrari of seating. 

These are (9:03) the most expensive seats in the world, essentially, single passenger seats. They’re highly (9:09) mechanical, highly over-engineered. They do everything for the client and customer. 

(9:17) We have a lot of custom-grade materials. Every component that goes into these seats are custom. (9:24) That becomes a risk relative to, say, you’re using carbon fiber, and the tow company that (9:31) you certified to decides they want to go make windmills, and they’re done. 

Little old RCOs (9:36) sitting there going, well, wait a minute. We certified our entire platform of seats on (9:41) your grade of carbon. They’re like, well, we’re sorry. 

The next thing you know, you’re out (9:47) chasing down another grade and have to go back to the sled testing and go back to the dynamic (9:52) testing. Those are big bills that you didn’t plan for. There’s risk like that. 

There’s risk in (10:01) probably the economy, but I’ll tell you, RCO diversified into aerospace. Okay, great. (10:10) Not only did we diversify into aerospace, we’re not tier one. 

We’re an OEM. It’s not like we were (10:15) building to print and diversifying. We just jumped right in completely. 

We own the designs, (10:23) the specs, the spec development, all of that. We’re like a little GM in that scenario. (10:28) How did the culture of the organization shift? Obviously, not just from auto to aero, (10:36) but you had all of these other responsibilities coming into play. 

How was culture impacted (10:43) during this time? It’s still being impacted today, 15 years later. Is there an us versus (10:48) them type of thing? The auto guys versus the aeros? No, that’s less and less, but that was (10:53) the beginning. As a company, you have resources, processes, and values that are all the foundation (11:02) of what you’re offering. 

All of a sudden, you say, okay, guys, we’re going to go take on this (11:07) aerospace work. Well, in the beginning, it’s still 90% auto, the stuff that’s coming through, (11:13) and they’re paying customers, and we know who they are. We don’t have a lot of sales activity (11:18) to go get the work, and so your resources are like, oh, yeah, that’s fine. 

That’s aerospace, (11:24) but we got this automotive work. This is what pays the bills right now, too. (11:27) Yeah, paying the bills. 

Then processes, as you can imagine, in a low volume environment, (11:37) the processes that you put into place are probably more tied to humans than they are robots, (11:45) especially with a custom product. We have a couple hundred configurations of seating (11:50) that are involved, and they’re significant configurations. You don’t put these together (11:54) with robots, but in the end, there’s a lot of process from A to Z finance to sales that have (12:03) to be converted toward the aerospace. 

I say sales only because of contract development, and the (12:09) reality is to get a brand-new platform for seating isn’t something like you’re working on (12:15) it for a few months, and you get the job, and you move on. You’re working on this stuff for years, (12:21) so it’s a different mindset shift. You kind of mentioned that to me where you said, (12:26) look, in automotive, if we sign a bad contract, we’re in for four or five years. 

If we sign a (12:32) bad contract in aero, we’re in for some time. Yeah, you’re in it for the full life cycle, (12:38) especially if you’re an OEM. Again, for the audience listening in, if you’re diversifying(12:44) into aerospace as a tier one build-to-print or a tier two build-to-print, the contracts are(12:49) a lot less risky, but when you get in as an OEM, you’re definitely in for the long haul. 

(12:58) The reality is we own the engineering. We have to keep the engineering alive as long as the(13:02) planes are alive until five aircraft are all that’s left in existence, and if you can imagine(13:09) being on Gulfstream platforms, you see a lot of old Gulfstreams out there, and you go over to (13:13) Pontiac. There’s some 1980s sitting out there. 

Harbor Springs, 4th of July weekend, you see a (13:19) lot of Gulfstreams. Yeah, and so we own ensuring that the seats are airworthy. Ultimately, (13:28) we don’t have to pay. 

We get paid to do that, but we have to keep the engineering alive (13:35) for the lifetime of the aircraft so that these things are- (13:39) Until five are left in existence. Yeah, yeah. Now, that’s a contract scenario that we have (13:44) with different customers, but the reality is that’s not necessarily the FAA saying that. 

(13:50) Interesting. Did you guys fund this whole endeavor internally, or did you have to go (13:57) outside for funding to do this? No, we heavily funded it internally. There was a lot of risk. 

(14:04) Ownership played the risk chips on that, and they did really well with it. (14:14) But the customer does, depending on… They also input funding as well, depending on how much of(14:22) it they own and that type of thing. It just depends. 

That’s really actually a very good (14:27) contractual discussion for anyone entering the market, is ultimately who’s paying and (14:34) how much of the intellectual property is owned in the end. And on an OEM seat, what would you say (14:41) the percentage is of the IP that you guys own versus… It’s more of a 50-50 for pretty much (14:46) across the board, everything we do. Okay, got it, got it. 

What were some of the trials and (14:52) tribulations of the whole process here? Well, some of the first tribulations were- (15:00) It’s like on the development side of things. On the development side, we were probably three (15:04) months before we were going to ship our first ship set. We had six or seven ship sets of seats, (15:10) and a ship set of seats is anywhere from 10 to 14 seats, depending on the cabin layouts and whatnot. 

(15:20) So we’re piecing this thing together. And I remember thinking, well, geez, we got to go(15:24) hire some aerospace engineers. And so we started looking around in Detroit, and it’s not like… (15:30) Again, we were building this seat like we’re in our parents’ basement. 

We didn’t know what aerospace (15:34) was going on. And so we ended up having to learn for ourselves what network we could find. (15:42) And we hired an aerospace engineer, the quality engineer. 

And he came into my office one day, and (15:47) he’s like, hey, we usually get an order for each project. In this case, it would have been a ship (15:54) set. And we just order all our fasteners from mill standard fasteners or NAS fasteners, which is (16:02) tied to the aerospace industry. 

I said, oh, he said, but all these ones here, they’re all automotive. (16:09) I don’t know if they’re going to pass conformity with the FAA. And I was like, okay, (16:16) all right. 

Well, this is how we do business, bud. We’ve got these automotive fasteners here. (16:21) We’re fine. 

I’m not kidding you. It wasn’t a month later, and the FAA came through the door, (16:26) and they started messing around and ultimately came into my office, (16:33) declaring that we have an issue with these fasteners. These are not fine. 

(16:36) And I was like, uh-oh. So ultimately, we threw everything in the kitchen sink at it (16:44) and essentially bought Instron Tensile Test Machine, called the Instron Company. They’re (16:49) like, hey, we haven’t made these fixtures in 40 years. 

What are you guys doing? And we’re like, (16:54) nope, we need them. And we started testing fasteners. And the reality was is that (17:02) I think it was something like seven fasteners that had failed. 

(17:05) You said like out of 200, right? So it was a very small percentage. (17:08) Yeah. We had to develop a project for the FAA, and we agreed to do certain levels of testing (17:16) on these fasteners. 

And what’s interesting is we had hardly any mill or NAS spec fasteners (17:22) in these seats. And the reality is that the design engineers, that would have been another (17:26) constraint for them. And they had zero constraints when they went after designing these seats. 

(17:32) And so really, when you think about our competitors, people would come and say, well,(17:36) the competitor could take this business. I’m like, no, they can’t. They will never touch(17:42) this business. 

Or at least the design, I should say. Because they wouldn’t get far out of their (17:53) risk zone. Meaning that they wouldn’t go out of their way to leverage a new fastener versus they (18:00) would just be using the pre-certified fastener, where you guys are certifying your own fasteners(18:05) and saying, okay, now we can use these in the design, which we already have on the shelf. 

(18:09) Yep. So what’s interesting is we now have a whole slew of fasteners we can use, (18:15) which that wouldn’t have happened had we walked into this not understanding regulation. (18:24) So in any event… Meaning if you would have understood… So almost the what you didn’t (18:28) know is actually what helped you. 

Yes. No, that’s… Thank you. What you don’t know can hurt (18:34) you. 

In this case, what you don’t know actually helped you. Yeah. No, absolutely. 

Yeah. So that (18:38) was like an early scenario. But we’ve had lots of challenges that we’ve overcome as a result of not (18:48) knowing. 

Sure. Sure. And now you’re the experts, right? Sorry, you’re the 15, 16-year-old novice (18:56) driver at this point. 

Yeah. But I think we’re gritty enough. We have talent. 

We’re gritty. (19:04) We can certify things. We’ve certified a lot of stuff that hadn’t been in the hands of the FA in (19:11) the past. 

So you have to open up a special project if you’re bringing a new raw material (19:16) into the market. So I feel like the company has the ability and the strength and the exercise of (19:25) bringing new things to market and certifying them. Well, I mean, you had said we’re very much(19:31) vertically and horizontally integrated, right? And from what I’m hearing is you’re really doing (19:39) a lot of insourcing. 

You try not to look to the outside. Was that born out of the, (19:45) we’re in the prototype business, therefore we know we have to kind of make tools, build parts, (19:50) things that don’t exist, and we have to be real gritty and kind of self-manufacturing of so many (19:55) things already. So that kind of that genesis of that attitude is what’s carrying through a bit? (20:02) Yeah. 

If you think about the market we were in in prototype, a lot of it involved seeds. So we (20:08) manufacture foam. We pour it. 

We also mill it. We manufacture sheet metal. Think about a sheet (20:14) metal frame in a seat. 

We do lots of cool things in the sheet metal, lasers and all sorts of cool (20:19) CNC bending and all that stuff. So we’ve grown since the 70s in terms of we have really nice (20:26) assets on ground. Plastics injection molding, obviously that’s a big piece of seeding. 

We have (20:32) a trim department that does ultimately cut and sew activity, but we do just, we don’t do a lot of (20:38) production there. We just do a lot of development work for the OEMs. What else? We had a foundry. 

(20:45) We big into additive. We have additive manufacturing plant. We have an interior exterior(20:50) like super low volume custom paint scenario. 

We have a landing zone where we bring customers in. (20:56) That’s still prototype a lot where we can section off areas of the company and or section (21:01) off areas of that building so that it’s secure and private. And you’ll see in one (21:07) area we’re building autonomous cars for the integrating the technology into autonomous cars. 

(21:14) Obviously in one area of the company, this is all on campus, right? So when we talk about the (21:19) horizontal, we have a lot of manufacturing capabilities that were born in prototype(21:22) that were converted into automotive production and are also now converted into aerospace(21:28) serial production, low volume. There’s not many companies you run across that are IATF 19649 (21:34) and AS9100 and that’s across the board, across all of our factories. What does the campus look (21:40) like? What is the factory layout? We have 11 or 12 buildings, 650,000 square feet. 

(21:50) 12 in gross spec. Anything out of the region or everything else? (21:55) We just had an open house down in Savannah, Georgia. We have 5,000 square feet (22:01) leased down there and that’s going to be a service center for seating. 

We also have a test (22:06) lab out in Plymouth, Michigan. It’s a static environmental test lab that primarily supports (22:13) the auto industry. However, we also do aerospace testing. 

Did you have to add a lot of square (22:17) footage when you added the aerospace in? Yeah, we did buy a building, converted it. (22:25) It’s a light industrial building, about 40,000 square feet. That’s where we build (22:32) our seats and we house the OEM staff if you will. 

Got it. How have you taken all of this (22:39) to market now that you’ve matured? You’ve got this initial client (22:47) or I’m sure there’s more than one. Yeah, we have more clients now. 

(22:51) What’s the go-to-market on that? What do you mean by that? Who are you seeking out?(22:58) For one, all of our plants are AS9100 so they could do build-to-print for (23:08) OEMs or large-tier primes in aerospace. We see growth there and growth is happening there. (23:17) In terms of passenger seating for the business jet world, we are branching out. 

We do have (23:26) some small contracts that we’re working on right now. The Gulfstream is continuing to grow as well. (23:32) They’re the biggest horse in the race when it comes to large cabin business jets. 

If you (23:40) follow General Dynamics who owns Gulfstream, half the talk on the earnings calls is Gulfstream (23:46) right now. They have a lot of growth happening. If you think about it, we talked a little earlier, (23:53) there’s about 25,000 business jets. 

Why don’t we have Jackie, can you bring the (23:59) sheet up that talks about those stats? That’s the one. If you scroll down a little bit (24:07) to the business jet outlook, there’s 24,000 business jets globally. Keep going down. 

(24:14) About 700 delivered annually. I think it pushed 730 last year. That’s worth roughly $20 billion. 

(24:21) If you do a 20-year outlook, that’s a half a trillion dollars. I’m not even putting inflation(24:25) in there. I’m just throwing a quick number. 

Of the 700 business jets produced a year, (24:31) about 200 are large cabin. We live in that space. Gulfstream lives in that space as well. 

They own (24:37) pretty much half the market share. We continue to grow with them. When you’re talking about (24:46) industry, we’re always talking about in industry here in the Detroit area,(24:51) is the diversification. 

So many people are worried about as EVs become more prolific, (24:57) there’s less parts, there’s going to be less need for bodies and people, and we’re going to need (25:02) re-skilling of people. Obviously, just re-skilling of people just for the EV side of things from the (25:07) internal combustion engine. Also, people are looking for diversification. 

You also threw (25:14) up here on this stand here, the global outlook is right here. We’re looking at, if you scroll up, (25:20) Jackie, to the top, just commercial outlook overall is a doubling industry over the next (25:26) 20 years. Absolutely. 

If you look to the right there, the regional highlights is really showing (25:32) you where the growth is happening in passenger traffic. That’s the key indication for commercial (25:41) jet manufacturing. Today, there’s 25,000 jets in service globally, and they plan to produce in the(25:49) next 20 years between Airbus, Boeing, 44,000 jets. 

In the end, some of them are retiring, (25:57) but in the end, we’re growing from 25,000 jets in service today to 50,000 in service in 20 years (26:02) from now. If you look at the value of those jets, it’s worth over $6.5 trillion, and 65% (26:11) of that is spent in the supply chain. Boeing, Airbus, Lockheed Martin, Raytheon, they’re all (26:18) spending money in Michigan. 

We look at this and say, look, we don’t need Boeing to come here and (26:23) make planes in Michigan. We just need to brand Michigan and get more of the parts supply (26:30) and the system supply. We have quite a bit going on here in Michigan. 

That’s maybe another little (26:35) rabbit hole we can get into a little bit later. The reality is, and you look at the revenue tied (26:41) to this thing. We’re entering our service. 

We’re 15 years old, so we’re starting to enter (26:47) the service market where we’re doing maintenance, repair, and overhaul of seating. (26:52) That is a lot of- Can we just explain that for people? (26:55) There are seats that you built 15 years ago that are now requiring service, is the point, (27:02) and that 40 years is the overall life cycle. These seats could require multiple service points (27:08) through the 40-year timeline. 

In the commercial plane, (27:13) they have what they call different checks. It’s all regulated. They’re checked annually, (27:19) every two years, every four years, depending on what system needs to be checked. 

Essentially, (27:25) they’ll end up doing a heavy check at some point, whether it’s nine years, 10 years, or 12 years (27:29) for the first heavy check where they completely strip out the interior, look for corrosion, (27:34) rebuild the engines, all that. The engines are on their own timeline. These are $150 million, (27:42) $200 million jets with $20 million a piece engines on them. 

Some of those things, obviously, (27:50) have large maintenance, repair, and overhaul revenue outlooks. They talk about that service (27:58) model value up there, $4.4 trillion. Over the next 20 years, to keep the planes in service, (28:06) there’ll be $4.4 trillion spent. 

That’s not talking about the $6.5 trillion for the plane. (28:12) Correct. For 20 years of planes. 

(28:16) If you’re advising the high school kid today, what should I do when I grow up? (28:24) There’s a lot of growth happening in aerospace. I could advise the students, (28:32) but I think the big thing for us right now is to advise the stakeholders of the state of Michigan (28:38) to really sink their teeth in this and really peel this onion and understand what it is. (28:44) We figure today there’s about $8 billion of GDP leaving the state of Michigan. 

(28:51) Due to what factors? (28:52) Well, $8 billion in GDP in aerospace for the state of Michigan. We’re a $500 billion GDP state, (29:00) roughly. It’s grown a little bit. 

A big chunk of that’s in the retail of home loans and stuff (29:06) like that, but there’s also $100 billion, let’s just say, in manufacturing. Say $70-80 billion (29:13) of that is auto manufacturing. We have $8 billion that we do in aerospace manufacturing. 

(29:19) Currently. (29:20) Yeah, currently. That doesn’t even include the tooling that’s happening, tool manufacturing, (29:25) which is hard to capture that revenue stream. 

(29:28) Sure. But if we can just use maybe some really oversimplified math, (29:31) if we know that the commercial market is doubling over the next 20 years, we could perhaps (29:37) capture that here or a vast portion of it with our manufacturing prowess. (29:41) Yeah. 

We’re doing that. We spooled up in 2017 the Aerospace Industry Association of Michigan. (29:47) Which you’re involved? (29:48) Yeah, I’m on the board. 

I was a founding board member. I was probably the smaller company on the (29:54) board. GE Aviation, Pratt Whitney, Eaton Aerospace, University of Michigan are all on the board. 

(30:02) There’s a few small companies. Basically, from Jackson to Calumet and UP, we have board members. (30:06) Okay, great. 

We’re going to include, I know, in our show notes and everything, (30:10) we’re going to make sure that folks know how to attend because you’ve got an upcoming (30:15) event here in Michigan happening in September. This is an annual event? (30:21) Yeah, it’s an annual event. This will be our third annual event. 

This type of conference, (30:30) I’ll call it high-end for lack of a better word, but we’re bringing global stakeholders (30:35) with the C-suite stakeholders from Boeing, Airbus, Lockheed Martin, Liebherr, Eaton. (30:45) A lot of big names are coming. Ultimately, these types of conferences typically happen in Seattle, (30:52) Montreal, Singapore, Los Angeles. 

No, we’re bringing it to Rochester, Michigan, Royal Park Hotel. (31:03) Bank of America, Industry Outlook, major players that are involved around the aerospace industry (31:10) are coming here to talk about the industry. We’re exposing Michigan’s strength. 

(31:18) I think it’s a real important event for people to attend that are interested in understanding(31:24) and starting to want to put the pieces together on what’s going on in the world of aerospace. (31:31) The speakers are really good speakers, so they’re good to listen to regardless of the content, (31:38) but the content is really strong this year. We’re opening up with a talent panel. 

(31:44) I’ll be moderating a panel. Dick DeVos is kicking it off because he was founder of the Western (31:50) Aviation Academy, which is at the Gerald Ford Airport in Grand Rapids. (31:57) That’s actually a high school, correct? (31:58) Yeah, that’s a charter high school. 

It’s a charter public high school. (32:04) He’s investing in it because he sees the talent being an issue. Obviously, I’m sure there’s other (32:12) things, legacy and stuff like that. 

He’s kicking it off. Obviously, he’s flying in (32:18) for just a couple hours and taking off. (32:21) That’s just to show his commitment to the aviation business. 

He’s not going to drive (32:26) in for the aviation. We’re doing a really cool talent panel. I travel to a lot of conferences, (32:35) and I’ve seen a lot of agendas. 

This is going to be a really cool talent panel. (32:41) We have the University of Michigan, a professor from the University of Michigan that’s super (32:46) dynamic. We have an F-16 fighter pilot. 

Myself are all leading panels of colleges and high (32:54) schools and universities. We’re even doing a student panel, but Dick’s kicking it all off. (32:58) Then we’ll get into business. 

Talent is on everyone’s mind. It’s the number one issue (33:05) in aerospace. It’s the number one issue. 

I’m sure you hear from folks that you bring in from (33:09) industry. (33:10) Yeah, all the time. We’re just concerned about the talent pool leaving here. 

We’d rather be (33:15) upskilling it than keeping it here. (33:18) This episode of the BLTNT podcast is sponsored by Oxium, business IT and cybersecurity designed (33:24) to outsmart chaos. Empowered by Juniper Networks, automate your network with Juniper Networks and (33:29) the Mist AI platform, the world’s first AI-driven wired and wireless network. 

(33:36) We’ve really covered a lot of what I would… We do business, life, technology, and transformations (33:41) here. I think transformations, you guys have knocked it out of the park. You check all the (33:48) boxes there and talked a lot about business. 

Let’s talk a little bit about life a little bit (33:55) here. We have kind of an interesting fact is that in that chair, well, actually in the chair, (34:01) we had two people in the room when we interviewed them, but you actually went to college with Tom (34:05) Swartz, who’s the CTO at Detroit Manufacturing Systems, who we interviewed just in a couple (34:11) episodes ago. Yeah, yeah. 

No, Tom and I have known each other since, I would say, the mid-90s. (34:18) He’s a fraternity brother of mine at Ferris State University. He didn’t go into plastics, (34:23) but I was in the plastics engineering program. 

I think he was business. I actually forget, (34:29) but nonetheless, so Tom and I, we’ve always maintained friendship. I used to live in Royal (34:35) Oak, and so he did as well, and so we’d always run into each other every once in a while. 

(34:40) That’s a small world. It’s a small B-L-T-N-T world, but tell us a little bit about growing up.(34:46) You’re a Michigan. 

You grew up in Michigan your whole life, and tell us a little bit about that. (34:51) I grew up in Michigan at Playa, Michigan. My dad was an engineer for General Motors, final line (34:57) manufacturing engineer. 

My mom stayed. She would stay at home, and I have two sisters, (35:03) one older, one younger, and they both live up in Fenton. Actually, all the family lives up in Fenton. 

(35:08) I grew up in a farming community, so my mom and dad, when they got out of the Navy, my dad was (35:14) in the Navy. He never set foot on a boat, but he was an aircraft mechanic for the T-28 trainer. (35:22) They had my sister, and they needed a home, and so my uncle gave them an acre lot, (35:30) or sold them for very cheap an acre lot on the farm, and so when I say I grew up on a farm, I did. 

(35:36) It wasn’t my parents, although we helped a lot. It was corn and soybeans, so I grew up in that (35:42) environment. My dad was a big gearhead, so we were always rebuilding a Jeep or built a sand rail, (35:52) always doing something with a muscle car, so I was always out in the barn. 

I was an engineer (35:57) when I was a little kid. From a young age. From a young age, and obviously strong work ethic. 

(36:02) My parents were both pretty busy people. In fact, my dad today, we were up north last(36:09) couple weekends ago, and working on a project, and I’m aligning some stuff and drilling some (36:15) holes, and he’s like, give me that. Give me that drill. 

He’s still 77 years old, and he acts like (36:22) he’s 50. That’s great. I look at him, and I’m like, man, I wish I could slow down, but you’re (36:28) the reason I can’t, and I never will. 

Right. I never will. It’s in your blood. 

It’s in your (36:33) blood, and so I went to Ferris State University, left there, went to … Well, I started working (36:43) in the plastics engineering automotive, so ultimately, I was working for a company called (36:47) Key Plastics in Grand Rapids. That’s where I learned all the manufacturing. I always tell kids (36:51) that are in engineering, if you want to get into the business side of it, you need to get (36:55) on the manufacturing floor. 

No one can ever take away those learnings from you, and I see a lot of (37:03) people that are unsuccessful in their careers because they hadn’t got that experience, (37:10) because ultimately, when you move forward in your career, you’re more respected because you (37:15) know what’s happening out there, and you know what can happen, and you’re listened to a lot (37:21) better than if you just decide to go into just program management or just design engineering. (37:29) Yeah, true, or just academia versus getting the … (37:32) The money’s made on the floor. (37:33) Getting the floor experience. 

(37:35) Yeah, and you could start striking lines on a tube, but every line you’re striking is (37:38) a potential cost, and ultimately, if you come from manufacturing and you start designing, (37:45) I think your legs are … You’re far in front of a lot of folks. (37:51) Sure, sure. (37:52) But yeah, so then from … Yeah, so I worked in auto industry for probably 18 years before I (38:01) went to RCL, which was also automotive before then I got into the … (38:04) And what was your original role at RCL?(38:07) Plant manager of the injection molding factory. 

(38:09) Okay. (38:10) Yep, and the idea was to turn it from prototype to production, which we did,(38:13) so we ended up … We didn’t even have a materials required planning system, MRP. (38:19) We didn’t have ERP. 

(38:21) We had all these orders coming in from the customers, and everything was an Excel spreadsheet, (38:29) and we had to have a contract service pull in the data, and it was pretty … And we didn’t (38:37) have a lot of procedures about process monitoring, and just you name the gamut. (38:41) How did the founders handle you coming in and helping with that transition? (38:47) Again, the prototype world seems very interesting if you’re an engineer, right? (38:53) You get to build it, make it, think about it, whereas when you’re going into the production (38:59) business, you’ve got to be efficient, you’ve got to have every process has to be lined up. (39:05) How did they handle that? (39:07) Was it their idea to do that? (39:09) Yeah, it was their idea. 

(39:10) Purposely bring you in to accommodate that to happen? (39:13) Yep, so it was their idea.(39:16) They were seeing the writing on the wall relative to product development and prototype(39:20) activity because the industry was getting smarter. (39:23) Less and less prototypes were becoming a thing, so a lot of the OEMs were doing pre-production (39:32) tooling and skipping the prototype, and they would prototype off the production tools to (39:37) save money. 

(39:38) And then, of course, later on, in about that time, ultimately, additive manufacturing (39:44) became a thing in the plastics world, and a big piece of our prototyping was plastics (39:48) injection molding. (39:50) So we also invested in additive manufacturing. (39:54) We have quite a few machines that are running nonstop, making plastic components. 

(40:00) Do you do metal additive? (40:02) Nope. (40:03) Or just plastic? (40:04) Nope, just plastic.(40:07) We’ve looked at metal. 

(40:10) I’m sure it might come into place at some point in time, but the business case really (40:13) didn’t support us moving forward with it. (40:18) What else do you think you want to talk about?(40:23) Well, I think the AeroOne conference at Royal Park Hotel, September 4th through 6th, is(40:31) a great place for people to come learn the industry. (40:33) I want to share learnings. 

(40:35) I get up and speak at these conferences. (40:37) Yeah, I would say teaching seems to be kind of a theme, a thing. (40:41) Yeah, so it’s a place for at least me to give back and feel like you can have an impact. 

(40:48) I think everyone wants a diversified portfolio, right, in their 401k? (40:52) You bet. (40:52) The state needs one as well. (40:54) And I think with some of the challenges going on in the auto industry right now, it’s (41:00) important for companies to not feel like… (41:04) The word aerospace is daunting. 

(41:07) When you first think about, well, I want to get in the aerospace industry, it’s a little (41:12) scary. (41:13) But the reality is there are some mom and pop shops out there that are aerospace companies. (41:19) It’s not as scientific as you think, but there is a lot of regulation and you have to sift (41:24) through it and learn through it. 

(41:25) I think come to conferences like this, you begin to network and understand the industry,(41:32) obviously the demand for aircraft. (41:35) This is just the commercial aircraft and business aircraft, but we have demand for rockets, (41:41) demand for satellites, might have demand for mining equipment on Mars. (41:45) I mean, who knows? (41:46) And defense aircraft. 

(41:48) Yeah, defense aircraft. (41:50) This advanced air mobility thing, it has some business case challenges, but eventually it’ll (41:55) work. (41:56) It could flip to a positive business case. 

(42:00) And advanced air mobility is really people, parcel, people or parcel, military or civil, (42:07) rural or city. (42:11) So when you look at potential package deliveries and things of that nature, maybe package (42:16) deliveries in a rural community are going to be a thing. (42:19) Obviously, a drone, electric drone can probably get from A to B quicker in a rural community. 

(42:25) That’s just Jeff’s opinion of it. (42:27) But that’s out there in the future too, and those could have a high volume scenario. (42:35) But there’s a long road before that happens. 

(42:38) I mean, right now, I keep circling back to the commercial jet forecast, and that’s really(42:45) what pays all the bills in the aero industry. (42:48) That’s where all the real developments are happening, I would imagine, too, from the (42:51) technology side of things. (42:53) And it’s critical infrastructure to the country. 

(42:56) It’s also within the top 10 global exports. (43:00) So when we hear about Boeing having troubles, I mean, that’s a real concern for the nation. (43:06) But a lot of the tier ones and primes, they don’t just supply to Boeing, they supply to (43:10) Airbus and Embraer. 

(43:12) So they’re supplying parts globally. (43:16) They might make the planes here, but the parts are leaving. (43:20) Aerospace is fragmented. 

(43:22) Ultimately, it’s very fragmented. (43:26) Automotive, typically, you’ve got an OEM plant producing Chevy pickups, and it’s a (43:30) supplier park, and everyone’s aligned to standards and advanced product quality planning and (43:37) all these systems. (43:38) When you stand back, and I’ve had moments in automotive like, oh my god, we have no idea (43:43) what’s going on in the industry. 

(43:44) But when you stand back and look at automotive versus aerospace, automotive is just cadence, (43:49) cadence, cadence, policy, procedure. (43:53) In aerospace, it’s regulation, heavy regulation. (43:59) And there’s a lot of inefficiencies. 

(44:02) We did talk about that, though, the regulation. (44:04) You’re not seeing a ton of the regulation yet coming your way from the cybersecurity (44:08) aspects of things. (44:10) Yeah, for RCO, we’re talking about it in the boardroom, if you will. 

(44:15) You know, when the stars align and we need to make it happen, we will. (44:20) You know, we have a level of security that I can’t really speak to. (44:26) You know, having you come look at it might be interesting with the company you have. 

(44:31) But, you know, we feel we’re pretty safe at the moment. (44:35) But if it’s commanded that, you know, we need cybersecurity for, you know, handling defense (44:43) data and things of that nature, we’ll make it happen. (44:46) What did you think about the recent issue with the CrowdStrike and Delta and how much (44:53) it impacted their airline in particular? (44:57) Yeah, you know, you think about Delta and how big they are. 

(45:02) And it’s like, wait a minute. (45:03) And they’re often thought of as the, you know, the premium aircraft or passenger carrier (45:11) and passenger airline. (45:14) And, you know, I was taken back a bit by that, that they didn’t have better controls in (45:20) place. 

(45:20) Yeah. (45:21) You know, and but again, it’s not something I follow that often. (45:27) What struck me the most on it was that it was, we call it in our world, we call it (45:31) technology debt, right? (45:32) So when they complained to CrowdStrike and said, hey, CrowdStrike, this is on you, CrowdStrike (45:38) pushed back and said, hey, you haven’t updated your computers in forever. 

(45:41) You’re on antiquated equipment. (45:43) We call that technology debt. (45:44) So they were in deep technology debt, or at least that’s what CrowdStrike is alleging. 

(45:51) That, you know, that made me step back a little bit and go, hmm, that’s interesting to think(45:56) that this premium brand isn’t keeping up on some of the table stakes. (46:00) Yeah. (46:01) And I think this could have some impact to the industry, right? (46:05) A big company like Delta, you know, you think about the impact of Boeing’s mistakes that (46:11) have been aired out everywhere and the Delta mistake here. 

(46:15) And, you know, it does shape the industry, right? (46:18) So I was happy to know that.(46:19) I mean, it was, these were more on the booking side of things than the computers that are(46:22) running the actual airplane themselves. (46:26) But still, I mean, you know, I never even thought about it until you brought it up here, (46:31) about the critical infrastructure piece of it, right? (46:33) How that’s considered, you know, critical in nature, right? (46:37) Yeah. 

(46:37) It’s not just necessarily just an inconvenience. (46:41) It can be a security issue. (46:43) It can be, you know, a defense issue to be able to mobilize our people, you know, where (46:49) we need to move them. 

(46:50) Well, and I’ll tell you, yeah, no, certainly. (46:52) And then, you know, relative to critical infrastructure, I mean, the country, and I have evidence of (46:57) this because I’ve been on some of the committees, but, you know, they’re, you know, the country (47:03) and the legislature is through, like, say, NASA or through, you know, Department of (47:10) Transportation is out looking for where our gaps are, you know? (47:14) And so, like, I don’t know if you heard about the Michigan Maritime Manufacturing Initiative (47:21) that just happened. (47:22) No, no, I haven’t. 

(47:23) It actually didn’t get a lot of news coverage. (47:27) However, I was invited, and the, oh, top NAVY came, and Colonel, and Governor Whitmer, and (47:37) Senator Peters, and they made a big announcement that, you know, the state of Michigan is getting (47:43) money to develop a talent base so that we can make submarines in the state of Michigan. (47:50) Okay. 

(47:50) So the first phase is really a talent development phase, and so they’re asking the community (47:54) colleges and others to step in and develop curriculum, and, you know, and a lot of it’s (48:01) really built around the trades, like the welding, the machining, and things of that(48:05) nature. (48:06) So it’s kind of agnostic, you know, some of the stuff that they’re doing could feed (48:10) other industries as well. (48:11) But, so that was some good news that, you know, the state of Michigan could be a player (48:16) in the defense in submarines. 

(48:19) And I mean, and it makes sense, right? (48:21) I mean, if we’re known as the transportation folks, I mean, maybe that’s the change in (48:27) branding here, from automotive to full-on transportation, whether it’s in the air or (48:32) in the sea. (48:33) Yeah, and I don’t think we brand ourselves. (48:35) You know, I look at a lot of people are, you know, heads of companies are really concerned (48:40) about talent. 

(48:41) I mean, they wake up at night, and this is a significant issue for them, and it has been(48:46) for a while. (48:47) And COVID just exaggerated it, but it really came to light during COVID.(48:52) And it’s not going, this problem’s not going away, you know. 

(48:55) And we oversimplified it when we were talking a little bit before, is just more people are(48:59) retiring than people are coming into the talent pool in those skilled trades to help us(49:04) manufacture these items. (49:06) Yeah, and I would say we, as a state, can argue that we have the highest concentration (49:10) of skilled trades in the country. (49:12) I would imagine so. 

(49:13) And, you know, yes, they are retiring, but you know what, what are we doing about it?(49:18) We have a base, we have a mentor base. (49:20) I’m on the board of FIRST Robotics, which is the K-12 STEM platform, and I’m always (49:25) amazed at all the mentors. (49:27) And they’re typically, you know, folks that are near retirement that are working with (49:32) these students and teaching them everything they got, building this robot and bringing (49:36) it to market. 

(49:38) And I look at that, and I’m like, wow, why can’t we do something like that? (49:41) But take those, you know, near retirement folks and give them an incentive to get back (49:49) into the education and help. (49:51) You know, I think the biggest issue you have is someone needs to release, you know, the (49:57) requirements to be a teacher. (49:59) You know, and I look at, I see it happen in FIRST Robotics, and there’s no requirement (50:04) here. 

(50:05) These kids are just learning from these people. (50:06) And this is a, quote unquote, unqualified teacher. (50:09) In terms of they’re not credentialed as a teacher, I should say. 

(50:13) These kids are learning a lot from those folks. (50:15) But I’ll tell you, like I said earlier, Boeing and Lockheed and SpaceX, they’re all spending (50:23) money here in the state of Michigan. (50:24) And they’re all running ads trying to get our talent. 

(50:27) But at the end of the day, they’re still spending money here because, you know what?(50:30) We do have the trades. (50:32) And I think we need to brand that as a state. (50:34) I really do. 

(50:35) I think we need to come up with, you know, let’s brand ourselves that. (50:39) Let’s call ourselves that. (50:40) Because when you call yourself something, eventually you’re going to be that somebody. 

(50:43) You name it and claim it. (50:44) Yeah. (50:45) And, you know, I think there’s a real chance that skill trades can come back alive. 

(50:49) And I think Michigan can be a bright spot there. (50:52) Great. (50:53) Let’s talk on the little bit of a risk of the manufacturing sides of things. 

(50:58) I have heard that there’s, from a supply chain issue and a security issue kind of together(51:07) here, is that we do have some small and mid-sized organizations that are very key. (51:13) You know, they might be making a bolt or something on that airplane or on that, (51:18) maybe not necessarily commercial. (51:19) Let’s use a defense contractor. 

(51:23) Somebody’s making a bolt for that. (51:25) And a foreign entity comes in and buys the company. (51:29) Yeah. 

(51:29) Right? (51:29) And all of a sudden, now that’s, let’s use China as the example, right? (51:32) That’s a Chinese-owned company now. (51:36) And if we go to war, all of a sudden they get the call from the mothership that says, (51:40) okay, shut down operations. (51:42) And all of a sudden we can’t build jets because of that fastener, that bolt, you know, (51:46) something that’s going into that. 

(51:47) What are you seeing about that? (51:49) Yeah. (51:49) You know, I haven’t ran into that, honestly. (51:53) I get that that’s something that could be real. 

(51:58) I, you know, I hate to say I have faith in the folks that are monitoring this, you know, (52:03) from DC, but, you know, I definitely, you know, I think we do need to secure that. (52:11) And, you know, but I haven’t followed too many stories where that’s popped up. (52:16) You haven’t been seeing it in your world where these three suppliers have been gobbled up by? (52:21) No. 

(52:22) You know, what’s interesting is, you know, so, you know, RCO has internal suppliers, right?(52:27) You know, for our passenger seating. (52:30) We also groomed probably another 60 suppliers that are local here in the state of Michigan. (52:36) So that’s the other interesting thing. 

(52:38) So RCO becomes this OEM, right? (52:40) And, you know, the growth over the last 15 years has been really good in terms of, (52:45) we’re on over 900 aircraft flying around the globe today.(52:48) So just imagine 10 seats in each one of them on average. (52:52) And, you know, so, you know, that just didn’t happen. 

(52:55) And all of RCO didn’t, you know, we had to have a supply chain. (53:01) And, you know, we picked some really nice, we found some really good suppliers. (53:05) And they came along with us in the journey. 

(53:08) And some of those suppliers are now a standing 100. (53:10) Wow. (53:10) So we kept the supply chain local for the most part. 

(53:14) We do have some unique things that we buy in France and, you know, some one-off stuff from (53:18) England and, but, you know, we had to go there because they had the technology(53:24) and we needed it quickly. (53:25) And, you know, that’s, you know, sure how it goes. (53:29) But for everything that, you know, a lot of machine goods, cables, (53:34) oh, geez, you name it, we buy it from the outside. 

(53:37) And, you know, we’ve grown a supply chain. (53:40) You buy it locally for the most part.(53:42) Yeah. 

(53:42) Here in Michigan. (53:43) That’s great. (53:44) Was that purposeful? (53:45) You know, it was, like I said, we were living in a basement when we were developing this thing, (53:50) you know, your parents’ basement. 

(53:51) Oh, you come up every day and be like, all right, who could supply that? (53:55) You look out the window and you’re like, you know, we, you know, it took a bit to build a network (54:02) and, you know, the aerospace industry, one benefit of joining that as a founding board member(54:09) is, you know, I brought a few folks, key stakeholders from the company to go to a lot(54:14) of the events and we found suppliers through attending a luncheon. (54:21) That’s great.(54:22) And started expanding. 

(54:24) And then, obviously, I started learning from the other board members what’s happening(54:29) because they’re legitimately in aerospace. (54:32) I mean, GE Aerospace, Eaton Aerospace, University of Michigan, these people are, (54:37) they know everyone in aerospace. (54:39) And so it was kind of a good thing because I was probably one of the more active board (54:43) members because I had so much to learn, you know, the board member from Eaton Aerospace, (54:49) okay, well, you know, he’s in aerospace. 

(54:52) He doesn’t need a network. (54:53) He’s just trying to, he’s trying to find talent. (54:55) Sure. 

(54:56) And he’s trying to grow talent. (54:57) That’s why he was on the board and pushing the talent initiatives. (55:00) And I was, you know, running around going, okay, I’m just, I’m a sponge, you know, (55:05) but I, we did a lot of work and we’re up to 150 members now. 

(55:10) That’s great. (55:11) That’s great. (55:11) And you told me too that, you know, we hear in all the business books, right? (55:15) Work on the business, not just in the business. 

(55:17) Yeah. (55:17) And you’ve really attributed a lot of your own personal knowledge and corporate success to (55:23) the fact that you’ve been out and getting to know all these people and learning and sponging up all (55:28) the, all the info. (55:30) But, but these relationships have really helped you, helped you build the business. 

(55:34) Yeah, they certainly have. (55:35) We have, you know, I have some contractors as consultants that I ran into that help (55:43) with information about what’s going on in the aerospace industry. (55:48) I call one of my consultants in every once in a while, because I’m like,(55:52) man, we have a real problem here. 

(55:54) And I think we’re really, we’re not on the right track or I think we’re on the track, (56:00) but can you come in here and smell? (56:02) And most often they were like, yep, Jeff, that’s aerospace industry for you. (56:09) High overhead, lots of risk, and you need your margin. (56:14) You need your high margin. 

(56:16) And I’m like, okay, thank you. (56:18) And just those little moments, I’m like, oh, all right.(56:22) I don’t, I feel confident with what we’re doing now. 

(56:24) And when you feel confident, that’s when you excel. (56:26) So, you know, getting to meet and learn from these other stakeholders that have been in (56:31) the business aerospace for 40 years, you know, maybe they’re retiring soon. (56:37) You know, it’s been very helpful. 

(56:39) And any thoughts of becoming a pilot or anything yourself, or have you already done that?(56:44) No, you know what? (56:45) I have ran out of gas a couple of times on the highway. (56:48) Okay. (56:49) And I’m kind of thinking that, you know, I would be like, okay, we’re in the air. 

(56:53) And I’m like, did I check that flap? (56:56) You know, my head’s spinning too much. (56:59) Yeah. (57:00) I’d rather just find another personality to fly me around the earth. 

(57:04) Somebody who’s better at check boxes. (57:06) Yeah, checking boxes and following all the rules. (57:09) Make sure the gas tank’s filled. 

(57:11) Yeah, it was so funny. (57:11) I had a funny story. (57:13) So I was golf streaming called and they were upset about something early on. 

(57:19) And so I had to go into the plant on a Saturday morning. (57:24) And so frustrating. (57:26) I had things to do with the family and all this other stuff going on. 

(57:29) And I, well, you know what? (57:30) I’m a man of my word. (57:32) I’m going to take care of this thing. (57:33) So that’s how I live my life. 

(57:34) And I get in the car and I drive down there to the plant. (57:38) I fix what I needed to fix, get them the data they need. (57:41) And I take off and I’m in the car and I’m still upset. 

(57:45) And I’m on 696. (57:47) And the truck just runs out of gas. (57:49) It was a 2013 Silverado. 

(57:51) So it wasn’t like, you know, ringing at you or pinging your phone. (57:57) And, you know, I’m down in the tunnel. (58:00) And so I get out of the car and I thought, gosh, I wonder if I have the gas can. 

(58:04) Well, I didn’t. (58:04) Oh, yes, I had the gas can for my lawnmower in the back of the truck and it was empty. (58:09) To get gas in it. 

(58:11) Kind of wished I’d gotten gas in it. (58:13) So I’m walking down the highway and just zoom, zoom, zoom, cars going by. (58:18) And all of a sudden this truck pulls over in front of me. 

(58:20) And I’m probably a quarter mile from my own truck. (58:23) And he backs up a little bit and I’m like, man, this guy’s going to give me a ride. (58:27) So I kind of run up there and you could barely hear. 

(58:32) He rolled his window down. (58:33) I could barely hear him. (58:34) Because it’s 696. 

(58:35) Yeah, yeah. (58:35) And I’m in, we’re in this tunnel. (58:37) The walls are 50 feet high. 

(58:39) And he looks at me and he’s like, and I thought, oh, he’s playing it safe. (58:45) He’s pointing to the back of the bed. (58:46) And so I jump up in the back of the bed of the truck and it’s a construction guy’s truck. 

(58:51) And it’s just full of like hammers and wood and old tire. (58:56) And I’m like cleaning the spot off. (58:58) And I’m going to sit in the center of this spare tire that’s sitting back there. 

(59:02) And I put the can in there. (59:04) I sit down and I look at him through the back window.(59:08) I’m like, okay, I think I’m going to get a ride, right? (59:12) So anyways, he stops it. 

(59:14) He gets out of the truck. (59:15) He’s like, no, I meant the gas can. (59:17) There’s a gas can in the back of his car? (59:18) Or he wanted you to put the gas can in there? (59:20) Yeah, my gas can in the back of his truck. 

(59:23) So nonetheless, this guy’s still friends with me on Facebook. (59:26) And we still laugh about stuff together on Facebook. (59:29) I don’t call the guy. 

(59:30) This is great. (59:30) But I’m sitting in the passenger seat now, right? (59:32) And the gas can’s in the back. (59:35) And we’re driving. 

(59:36) And he took me to the gas station. (59:37) And I said, well, what do you do for a living?(59:39) He’s like, well, you know, I’m Nicole Curtis’s construction guy. (59:42) Oh, how funny. 

(59:43) She’s the HDTV, like fix it up girl. (59:47) I can’t remember the name of her show. (59:49) It’s not like fix or flip or something. 

(59:51) Yeah, something like that. (59:52) And we both got a good laugh out of the idea that I was like, well, I guess he’s playing it safe. (59:59) That’s funny. 

(1:00:00) Well, pretty apropos. (1:00:01) My wife called me right before we sat down to do this and said, (1:00:05) I just need to be on the phone with you, (1:00:07) because I’m picking up somebody on the side of the road who ran out of gas. (1:00:10) Yeah. 

(1:00:10) So back to your question. (1:00:12) No, I don’t think flying a plane is in my DNA. (1:00:15) I think that’s a good idea. 

(1:00:16) I’ll sit in the back. (1:00:19) Of the pickup truck or the plane. (1:00:20) Yeah, yeah, yeah. 

(1:00:21) Either one. (1:00:22) Good point. (1:00:22) Yeah. 

(1:00:23) So you’ll probably have no problem flying economy class then, (1:00:26) if you’re willing to sit in the back of the pickup truck. (1:00:27) No, yeah. (1:00:28) And every once in a while, we do get a ride on a business jet. 

(1:00:31) It’s cool. (1:00:32) It’s pretty neat. (1:00:33) It’s nice. 

(1:00:33) A Gulfstream came and picked us up one day. (1:00:35) And the pilots come through the signature station or the place where you pull up and (1:00:42) they wash your car and you sit in a nice lobby. (1:00:45) And the guys are like, hey, have you heard of Buddy’s Pizza? (1:00:49) And I’m like, yeah, we’ve got Buddy’s. 

(1:00:51) We hear it’s the best pizza. (1:00:53) Do you mind if we wait 10 minutes until we just ordered a pizza? (1:00:56) I’m like, no, that’s no problem. (1:00:59) So next thing you know, I’m eating Buddy’s Pizza in a… (1:01:02) In a private jet? (1:01:03) In a private jet flying to Florida. 

(1:01:05) Nothing wrong with that. (1:01:06) I did think it was funny you told me that of the people that work at Gulfstream, (1:01:10) only 5% have ever… (1:01:12) Yeah, it’s… (1:01:13) Is that something like that? (1:01:14) It’s some crazy number. (1:01:15) Low number that have actually flown in a Gulfstream jet? (1:01:19) Yeah. 

(1:01:20) And it is an interesting market because we say we diversified in aerospace. (1:01:26) Then you say, well, you diversified as an OEM in aerospace, (1:01:30) but you’re also diversified in who’s buying your products, (1:01:34) high net worths from around the world. (1:01:36) Sure. 

(1:01:36) So it’s a very unique diversification. (1:01:39) And it’s very interesting to learn, you know, these are social missions. (1:01:44) It’s like, you know, it’s a mission just like, you know, (1:01:49) Lockheed has to put together for, you know, the Air Force. 

(1:01:52) Well, obviously that’s for security. (1:01:54) And we all think that, you know, that’s really important. (1:01:57) And it is, it’s far more important than a social mission. 

(1:02:00) But at the end of the day, these people are paying money for a social mission. (1:02:03) Right. (1:02:04) And, you know, it’s, you know, so, you know, (1:02:08) they’re the end customer and they’ll squawk and, you know, you’ll go fix it. 

(1:02:13) Well, and like you had said, (1:02:14) putting yourself in the mindset of that customer is imperative (1:02:18) because, and you’d given an example of the ice cream. (1:02:20) Yeah. (1:02:21) The ice cream on the flights. 

(1:02:22) Yeah, I’ve been looking at open issues lists on different aircraft. (1:02:28) It doesn’t matter all the, you can get on and see what these issues are. (1:02:34) But yeah, there’s scenarios where the ice cream was too hard. 

(1:02:38) Yeah. (1:02:39) And so that, even though that might not be an issue to you or to those 95% of employees (1:02:46) at Gulfstream, the clientele that they’re serving, that’s what’s important to them. (1:02:50) So it was kind of like I shared with you the mission at Oxium, (1:02:53) is our mission is to help other people accomplish their mission through technology. 

(1:02:57) So we’re here to serve whatever the mission is that you’re trying to do. (1:03:01) And that’s what you said is, you know, these are clients. (1:03:03) This is a social mission. 

(1:03:04) It might not resonate fully with you, not you particularly, (1:03:08) but, you know, that Gulfstream employee or anybody in the supply chain, (1:03:12) but that’s who the end client is.(1:03:14) And what the end client wants is what we’re serving. (1:03:16) And, you know, for the record, I don’t like hard ice cream either. 

(1:03:19) I mean, you put your… (1:03:20) I don’t either. (1:03:21) You spoon in it. (1:03:22) It’s like, wait a minute, you know, you want it nice and a little bit… (1:03:24) There’s a Dairy Queen right at the end of my street. 

(1:03:27) Soft serve. (1:03:27) They’ve got it all figured out. (1:03:29) Well, great. 

(1:03:30) This has been a great time. (1:03:31) Cool. (1:03:31) I’ve been a good time too. 

(1:03:33) I really appreciated you being here. (1:03:34) Yeah. Well, thanks for interviewing me and I appreciate it. 

(1:03:37) You got it. (1:03:37) And the Arrow One Conference, September 4th through 6th at the Royal Park Hotel. (1:03:44) We’re bringing it to Rochester, Michigan, which is super unique. 

(1:03:47) We’re bringing it from major metropolitan area to small town Rochester. (1:03:52) Love it.(1:03:52) For the state of Michigan. 

(1:03:54) Love it. (1:03:54) So great work. (1:03:55) Thank you. 

(1:03:55) Thanks, Jeff.