Cessna makes offer of voluntary buyouts to hourly workers
04/29/2013 3:04 PM
08/08/2014 10:16 AM
Cessna Aircraft is offering a voluntary retirement program for up to 180 Machinist-represented workers as it aligns its work force with its reduced forecast for sales and production.
The action, coupled with a similar program for salaried employees announced earlier this month, is expected to allow the company to make the majority of its work-force adjustments through voluntary means, Cessna’s senior vice president of human resources Jim Walters said in a statement.
“The expertise and commitment of Cessna’s workforce is unparalleled and any action we take that impacts our team, particularly reductions, is not taken lightly,” Walters said.
The company has been in meetings with the union about the program, said Machinists District 70 president Frank Molina.
“We’ve sat down and talked and talked about this,” Molina said.
In the past, Cessna has offered voluntary retirement packages to salaried employees, but not to hourly ones, he said. Typically, when the company reduces production, it lays off workers.
“It’s a unique situation; it really is,” Molina said.
Because the company must cut production, the offer is being made only to workers in Cessna’s Wichita aircraft division and not in the service center.
The goal is to minimize or eliminate layoffs altogether, if possible.
“It will depend on how many people participate (in the program),” he said.
The offer will be for those 55 and older who have at least two years with the company.
The package is for a $30,000 lump sum payout, Molina said.
In its statement, the company said that despite the buyout program, its job openings that are listed on the Cessna Careers website are still active.
Cessna employs 8,200, including 5,800 in Wichita.
Earlier this month, Scott Donnelly, CEO of Textron, Cessna’s parent company, told analysts that Cessna is cutting production this year because of weak demand in its light jet products despite traditional leading economic indicators, such as corporate profits, looking better.
Cessna has not been building a backlog of orders, Donnelly said on the conference call with analysts.
Instead, “you take an order for an aircraft and you deliver the aircraft,” Donnelly said.
Cessna remains committed to Citation jet products, especially in the light jet segment, the company said in a recent statement.
“Citations lead the light jet segment, and Cessna is fully committed to our current products in that category,” Cessna CEO Scott Ernest said in a statement. “From the Citation Mustang up through the CJ4 and beyond, customers who turn to Cessna for aircraft solutions will continue to find a trusted partner who is focused on delivering reliable performance day in and day out.”