Hawker Beechcraft boss: Layoffs a result of 'flat to slightly down' market
09/24/2010 12:00 AM
10/13/2010 5:50 AM
Hawker Beechcraft said today that it will lay off 350 salaried employees.
Chairman and CEO Bill Boisture said in a letter to employees that additional reductions may be required among hourly employees, although "we do not see a large-scale layoff of hourly employees at this time."
The announcement follows one Tuesday by Cessna Aircraft, which said it would lay off 700 hourly and salaried employees.
"The market for new production aircraft is not improving as we had hoped," Boisture said in the letter. "In fact, the market is flat to slightly down, and the conditions that would signal an upturn are not in sight for at least the next 12 months or longer."
Cessna CEO Jack Pelton said much the same thing in his letters to employees there: "The gains made in the first half of the year in the global economy have stalled, and Cessna's performance continues to mirror the lackluster economy.... The timing of any recovery remains uncertain."
Boisture's letter said the company was in the process of deciding where the reductions would be made and intends to complete the layoffs by Nov. 1. The company, which as of July employed about 6,000 people in Wichita, wouldn't comment beyond the letter.
Hawker Beechcraft and the Machinists union reopened negotiations a year early in order to save jobs in Wichita.
Hawker Beechcraft has told the union, which represents about 2,400 hourly workers in Wichita, that the company will move work out of Wichita if talks aren't successful, union officials have said.
Boisture has told The Eagle that the company is considering moving work to Louisiana or Mississippi. It's also looking outside the U.S. Boisture declined to say what the scope and size of any facility outside Wichita would be.
Hawker Beechcraft is scheduled to present a new contract to the union sometime before a scheduled Oct. 9 contract vote. If the contracted is accepted, it will replace the current contract; if it's rejected, workers will continue to work under the current contract.
Mayor Carl Brewer and City Manager Robert Layton have been talking with Hawker Beechcraft about what the city can do to keep aviation jobs in Wichita. Brewer is out of the country.
Vice mayor Jeff Longwell said he hasn't been updated on where those talks are.
He said the city hadn't been notified about the new layoffs at Hawker Beechcraft. "It's one of those unfortunate situations that we hope is short-lived," he said of the news.
Hawker Beechcraft issued layoff notices to 130 hourly employees in July; the company laid off 245 employees earlier in the year. It laid off 2,700 people in 2009.
In addition, it closed its Salina plant earlier this year, with half the work going to the company's plant in Mexico and the rest to outside suppliers and vendors. The Salina plant employed about 240 people.
"We are making good progress in reshaping our company to be more cost competitive and to operate effectively in the current and forecasted smaller market...," Boisture said in the letter. "Our company has proven itself capable of doing more with less, which will be a continuing requirement as we go into 2011."
Boisture has said that a series of decisions will be made over the next six months.
During a labor rally two weeks ago, Machinists District 70 president Steve Rooney told union members that Hawker Beechcraft has told the union that it needs three weeks to evaluate its latest offer from Louisiana to lure the company to that state.
It's not known how much the offer is worth, Rooney said after the rally.