Economic Plans in the Private Plane Industry
By Christina Bohnstengel
Following in the footsteps of Motorola, Morgan Stanley, Starbucks, Time Warner Inc.’s AOL, Kodak Co., and an endless list of other well known corporate names, the makers of private planes are cutting staff.
Citation’s Cessna Aircraft Co. announced that by next month their workforce will be down 30 percent after several rounds of layoffs. Boeing Co. just announced that it will let go of a whopping 10,000 employees. Low expectations plague Hawker Beechcraft Corp., and not one to be left out of the crowd, Gulfstream Aerospace Corp. will cut its mid-size aircraft production by 50 percent in 2009.
Even though panicked reports of Chicken Little’s falling sky abound, Nigel Wright, a managing director at Onex, which owns 50 percent of Hawker Beechcraft, is making lemonade out of some very sour lemons.
“We do see headwinds for the next year or two,” he told the Canadian Globe and Mail. “There are going to be significant reductions in production, and layoffs. Those things are very painful for the people involved, but it’s also a chance to make permanent changes to the cost structure that would be harder to make in normal times.”
Some of those changes include transitioning from relying on a saturated North American market, which drove growth in the past decade of decadence, to expanding the Asian, Latin American and Middle Eastern markets.
Email This Post
