More ups and downs
05/06/2012 12:00 AM
08/08/2014 10:10 AM
Though it was many years and bad decisions in the making, Hawker Beechcraft’s Chapter 11 bankruptcy filing Thursday felt like a punch in the gut for Wichita, creating fresh worries and hard feelings for the workforce and community. But Wichita’s economy and planemaking cluster are bigger than any one company, and the one in this case could well end up stronger.
Locals kept hoping a bankruptcy could be avoided, even as many throughout general aviation wondered how the Wichita-based company held off so long given its $2.5 billion debt and net loss of more than $630 million last year.
As the British website Corporate Jet Investor editorialized: Chapter 11 is “an opportunity for Hawker Beechcraft to find long-term shareholders who will give it money to invest in research and development; to renegotiate commitments with suppliers; and look at whether there really are synergies between the Hawker and Beechcraft products.”
That opportunity for the company and investors will test the sales force, which has to assure potential customers that Hawker Beechcraft will be around to stand behind its products far into the future.
The filing also calls into question not only the promises the company has made to retirees (who always seem to suffer in such restructuring) but also to the state, city and Sedgwick County.
Even with the 60-day layoff notices that went out last month to 350 workers, Hawker Beechcraft’s current local workforce of 4,700 is in no imminent danger of hitting the 3,600-employee threshold the company agreed to in accepting $45 million in local and state incentives to stay in Wichita in 2010.
But “bankruptcy” was not in the dignitaries’ talking points when that deal was signed and toasted, and the sincere willingness of taxpayers to help Hawker Beechcraft through this difficult time will have its limits.
Fortunately for Wichita, Hawker Beechcraft’s bankruptcy filing is no more the full story of local aviation than was Boeing’s January announcement of its plan to leave town by the end of 2013.
Cessna Aircraft Co. recently announced it was recalling or hiring about 150 employees and increasing its sales force. Last week Bombardier Learjet held a groundbreaking ceremony for its $52.7 million expansion – the largest in the company’s long history in Wichita – to accommodate work on the Learjet 85 and other projects as well as 450 more jobs. Last week also brought news that Spirit AeroSystems, which so impressed the community with its rebound from the April 14 tornado, had seen a 21 percent increase in revenue and 113 percent increase in net income in the first quarter.
At least Hawker Beechcraft’s filing removed all doubt that Chapter 11 was necessary. Now Steve Miller, Hawker Beechcraft’s CEO since February, can get busy demonstrating those turnaround skills for which he’s well-known – and protecting the proud 80-year history of the company that Walter and Olive Ann Beech built.
For the editorial board, Rhonda Holman
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