Cessna Sheds Columbus, 2,300 More Employees
Kerry Lynch
Cessna Aircraft today began issuing layoff notices to 1,600 more workers, part of 2,300 additional employees that will lose their jobs by the end of June, and announced that it is shelving what was to be the company's top-of-the-line aircraft, the Citation Columbus. Cessna also is closing the Bend, Ore. plant it inherited through the acquisition of Columbia Aircraft and is moving production work on the Corvalis single-piston line to Independence, Kan.
In a memo to employees this morning, Cessna Chairman, CEO and President Jack Pelton said, "Our primary near-term objective is to focus on our strengths and protect our core products in the light and mid-size business jet market segments, our leadership position in the single-engine piston and turboprop product segment, and our world-class customer support."
He called the decision to suspend work on the Columbus "difficult& but critical to sizing our business to the realities of today's market" and said the company considered every possible scenario before making the move. "We still feel this is a program with great potential and one we will pursue when the market recovers," he said. Textron officials said they expect to refund some $50 million in deposits on the Columbus.
The company will continue the 162 SkyCatcher program, he said, reiterating the company's commitment made during this month's Sun 'n Fun Fly-In in Lakeland, Fla. The company also is continuing work on the Citation CJ4 and other research and development projects.
Plans to close the Bend plan are "not a result of any dissatisfaction with the Bend operation, but is driven by the need to consolidate facilities for factory efficiency," Pelton said.
The 1,600 workers who received layoff notices today will remain on the payroll for 60 more days. In addition, Cessna expects to layoff up to 700 more workers by mid-June. "This sizes our work force for our currently planned production in 2010," Pelton said. Cessna also is extending a planned companywide furlough from to four weeks - June 22-July 19. The latest round of layoffs is in addition to the 4,600 positions already cuts since December.
"There doesn't seem to be a lot of good news for Cessna right now, but times will change," Pelton said. The announcement came as Textron reported that Cessna delivered 69 jets in the first quarter of 2009, down from a planned 80, and had logged net cancellations for 92 aircraft.
Artist's concept: Cessna
