Guy goes out in his twin-engine Beechcraft Baron. He returns home in bad weather, with clouds reported by witnesses as low as 500′ above ground level (AGL). He loses control of the airplane in a typical stall/spin accident, crashes into the ground, and kills himself. The NTSB did not mention any mechanical problems with the airplane or the engines and did not list engine failure as a possibility. The NTSB said only that the probable cause was “the pilot’s failure to maintain control of the airplane while maneuvering resulting in an inadvertent stall/spin.”
Teledyne Continental (TCM) was the manufacturer of the Baron’s engines way back in the 1970s or whenever this plane was produced (the NTSB doesn’t say). An engineer might say “it is impressive that those engines spun flawlessly for thirty years, not quitting until this pilot flew them right into the ground.” A jury saw this accident differently, ordering TCM to pay $4 million to the survivors of the pilot. The total market for these kinds of engines in new airplanes is about 2500 per year, of which Teledyne makes roughly half. So this judgment represents a cost of about $4,000 per engine sold every year to airplane manufacturers. The Federal Reserve Bank can cut interest rates to 0% and you’d still have to ask yourself how it could possibly be rational to invest in a U.S.-based company making aircraft or aircraft components. Subprime mortgages look great when you factor in this kind of litigation risk.
Related story: Airplane carburetor company sued out of business.