Contract talks between Hawker Beechcraft and its machinists have opened early amid published reports that the company is considering moving jobs out of Wichita.
Negotiations began Thursday, a year before the current contract is set to expire, with both sides saying they are entering the talks in the spirit of openness, frankness and respect while acknowledging the seriousness and gravity of the times, the Wichita Eagle reported.
Hawker Beechcraft CEO Bill Boisture said the market for business aircraft is 30 percent to 40 percent smaller than it was in late 2008. He thanked union representatives for agreeing to meet "at a very crucial time in our company today."
Tom Buffenbarger, international president of the Machinists union, said the company and union must find a way to keep jobs and the company viable. "We find it necessary to take a leap of faith," he said.
Hawker Beechcraft is seeking to cut costs and secure a long-term agreement, according to the union. Union leaders said the company told them that if talks aren't successful, it will move its aircraft production out of Wichita, the newspaper reported. The machinists union represents about 2,400 workers in Wichita.
The union says if production work is lost, other work is likely to leave as well.
Union officials said this round of talks would be the most difficult in the history of the company and the machinists.
Boisture said last month that the company is considering moving work to Louisiana or Mississippi, and looking at possible locations outside the U.S. Decisions, including the firm's future in Wichita, will be made over the next six months, he said.
The union agreed to reopen talks because the consequences of not doing so could be grim, union leaders said.
"The situation with Hawker Beechcraft is serious, and they are looking at several possibilities to move jobs from Wichita," union officials said in an Aug. 13 memo to members.
Machinists spokesman Bob Wood said opening negotiations early is unusual, but not unheard of when companies are in trouble. The union is going to look at doing everything it can to preserve jobs, but the union "alone can't save the aircraft industry in Wichita. We need help from our state and local officials," Wood said.
The mood going into the early negotiations sharply contrasted talks in August 2008, when striking machinists accepted a three-year labor contract after nearly a month on the picket lines. That contract covered about 4,700 hourly workers at the Wichita plant and 500 in Salina.
Since then, Hawker Beechcraft has said it was closing its Salina plant and has issued several rounds of layoff notices at its Wichita facility that have left the machinists union now representing about 2,400 workers.
Martin Perline, an economics professor at Wichita State University, told The Wichita Eagle earlier this week that preserving jobs is "absolutely critical" in Wichita, which has lost thousands of jobs in the recession.
"I wouldn't be surprised if the union winds up conceding the most out of this," he said.
Perline said that if Hawker Beechcraft gets enough union concessions and state incentives, it might keep jobs in the Wichita.
It wouldn't be the first aircraft company to move work out of Kansas. Chicago-based Boeing Co. moved production of its 787 airplane to South Carolina, said JSA Research aerospace analyst Paul Nisbet. Other companies are also moving to southern states without strong unions.
"It's a move that the managements are taking to improve their situation with the unions," Nisbet said. "It certainly seems to be working out for others, so why shouldn't (Hawker Beechcraft) try to do the same?"
Information from: The Wichita Eagle, http://www.kansas.com