August 1, 2013

Learjet shuffles workers to adjust to program delays

Bombardier’s Learjet plant is reshuffling employees to avoid layoffs as it adjusts to some delays in the Learjet 70 and 75 programs and the Learjet 85.

Bombardier’s Learjet plant is reshuffling employees to avoid layoffs as it adjusts to some delays in the Learjet 70 and 75 programs and the Learjet 85.

The Learjet 85 was delayed because of challenges with composites, but “today those are behind us,” Pierre Beaudoin, Bombardier president and CEO, said on a conference call Thursday with analysts, with whom he discussed Bombardier’s second-quarter results.

“We are adjusting the amount of people in line with the progress with the assembly schedule,” Beaudoin said.

Machinists union District 70 president Frank Molina said 63 union-represented employees were on a list to be laid off, but the union is working to find other positions for them within the Learjet facility.

“If we did not sit down with the company and work out a deal, it was going to lead to layoffs,” Molina said. Some employees received notices, but “zero people have been laid off because of our agreement that we made with the company. We’re trying to prevent any future reductions.”

So far, “we have taken a chunk out of it,” Molina said of working through the list and finding new positions for people.

The company is also being creative and offering training for jobs that workers aren’t familiar with, he said.

Bombardier spokeswoman Haley Dunne said the company has not announced layoffs at Learjet.

Depending on market demand and production rates, the company will reshuffle employees internally. The Wichita site did end the contracts of 40 contractors working at the plant.

Demand for the small end of the business jet market remains soft, Beaudoin said during his call Thursday.

“With the Learjet, we have quite a few innovations on the 70/75 so the demand is good, but in a soft market,” he said.

The Learjet 85 is preparing for its first flight later this year.

And customers are shopping for aircraft, but “they’re being very careful,” Beaudoin said.

The company’s fractional business, Flexjet, is growing again, which is good news, Beaudoin said.

Flexjet is a leading indicator of more traditional business jet sales, he said.

“(Customers are) consuming their contracts faster than the hours that they have. That’s good news. It indicates to us there’s a lot of interest in flying private,” Beaudoin said.

For the second quarter, Bombardier recorded revenue of $4.4 billion, up from $4.1 billion for the same time a year ago.

It also recorded adjusted net income of $158million, compared with $167million a year ago.

Bombardier Aerospace delivered 57 airplanes during the second quarter, compared with 62 for the same time a year ago. It received 82 net orders during the quarter, compared with 146 for the same time a year ago.

The business aircraft division received significant orders during the quarter, including an order from VistaJet for 20 Challenger 350 jets with options for another 20. Another customer placed an order for 12 Global 8000 jets.

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