Cessna Aircraft Lays Off 1,300

WICHITA, Kan. (AP) -- Cessna Aircraft Co., the nation's largest builder of corporate jets, said Friday it is laying off another 1,300 workers, raising the number of jobs eliminated to half of its work force since November as the recession has depressed demand for its planes.

Cessna said the cutbacks will affect all its facilities.

"The fact is this is a cyclical industry and right now we are in the worst part of the cycle. Our industry continues to struggle," said company spokesman Robert Stangarone.

"There are signs of an economic recovery and the recession may have reached the bottom, but it will still be some time before we see the kind of growth in the economy that will drive new airplane sales," he said.

The aircraft industry lags the general economy by about eight quarters, he said.

Cessna told workers that the first 800 60-day layoff notices, affecting mostly production workers, will go out by June 19. The company then will mostly shut down for a previously scheduled furlough period from June 22 to July 17. The remaining 500 affected workers will get their notices after they return, but no later than Aug. 14.

The company, a unit of Textron Inc. of Providence, R.I., also announced Friday an additional three-week furlough companywide on top of those moves.

During the furlough only essential services, such as customer deliveries and product support, will remain open.

"We are still seeing orders being canceled. We still see lots of customers waiting to see if the recovery in the economy comes to fruition," Stangarone said. "We see the average daily (airplane) utilization, that continues to decline. And aircraft financing remains difficult for our customers."

Cessna has laid off about half of its employees since the first round of cuts was announced in November. The company employed nearly 16,000 people last year -- including about 12,000 in Wichita -- before the economic downturn slashed global demand for corporate aircraft.

The new job cuts come on top of 6,900 layoffs since November.

Workers had been bracing for the next round of layoffs since the company warned them earlier this month that still more cutbacks were coming.

"We are confident that the business will come back, as it always has, and the actions we are taking are helping us position for the recovery," Stangarone said. "It is just a very difficult period we are going through right now."

In April, Cessna announced it was laying off 2,300 workers across the company and closing its Bend, Ore., plant as it tries to restructure its product line amid declining plane orders. Production of the Corvalis high-performance, single-engine planes at the Bend plant will move to the Independence facility.

Wichita-based Cessna Aircraft also has other manufacturing facilities in Independence, Kan.; Columbus, Ga.; Chihuahua, Mexico; along with 10 service centers across the United States and Europe.


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