More Job Cuts At Cessna, Hawker Beechcraft
Jan 9, 2009
Benet Wilson benet_wilson@aviationweek.com
Cessna and Hawker Beechcraft are further cutting 2009 production, blaming the global economic crisis for the moves. Both Wichita, Kan., manufacturers also announced more employee layoffs, although neither company released the exact numbers of worker to be pink slipped.
In a letter now circulating to employees Jack Pelton, Cessna's Chairman, President and CEO, wrote that 2008 had two "distinct" halves. The first half was "full of promise," with orders being signed according to projections. However, "the second half of the year ended by not only putting on the brakes, but also backing up a bit."
He continued that the impact of the economic downturn began in mid-year with a slowdown in orders for single-engine piston aircraft and by the third quarter, there was a "significant" drop in Citation orders. "We also experienced cancellations and deferrals of orders, seriously impacting our 2009 production growth," he stated. Among those customers deferring deliveries was NetJets, which accounted for a "significant" number of aircraft scheduled for delivery this year.
A Textron subsidiary, Cessna had planned to ramp up aircraft production to 535 jet deliveries in 2009, Textron Chairman Lewis Campbell said in an analyst conference call last October. But only a month later, the planemaker announced plans to scale back production of Citations in 2009, and said it expected to lay off 665 of its 16,000 workers.
Meanwhile, in a letter to Hawker Beechcraft employees, Chairman and CEO Jim Shuster wrote that the general aviation market has slowed and new orders have fallen off "considerably."
"As we enter 2009, we see the economy continuing to erode and find ourselves facing a highly uncertain and unpredictable business climate," he continued. "As a result, we are forced to substantially decrease our 2009 production levels and take the painful step of reducing our workforce accordingly."
Shuster took pains to reassure that the company is "extremely healthy" with a solid future. "While this is a disappointing way to start 2009, I believe that making difficult decisions now and sticking to the priorities that have made our company successful will enable HBC to survive this downturn and thrive in the long term."
Hawker Beechcraft warned employees back in October that cuts were coming because of lowered production and reduced demand. A month later, it announced plans to lay off 5 percent of its 9,700-strong work force.
Cessna CJ4 photo: Cessna
