CESSNA TAKES TOUGH DECISIONS

30 Apr 2009

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Cessna Columbus - Cessna's biggest bizjet. Will it ever be built now?

CESSNA is taking radical steps to save money during the recession. First, it is to close the former Columbia factory in Oregon where the 350 and 400 Corvalis aircraft are built. Second, it is suspending development of its new Columbus bizjet.

The moves were announced yesterday as parent company Textron discussed poor first quarter financial results. Up to 2,300 workers will be laid off - that's in addition to 4,600 workers already laid off. Cessna has now laid off almost half its workforce since last November.

Production of the Corvalis single-engine piston aircraft, pictured above right, will move to Cessna's main base in Wichita, Kansas.

The scale of the recession hitting Cessna is unprecedented.

Textron said it expects to deliver only about 300 Cessna jets this year, about 20% less than its previous forecast. In 2008, the company delivered 476 jets.  It may get worse.

"We certainly haven't seen the bottom," company spokesman Bob Stangarone told the Associated Press. "The economy may be approaching bottom but our business typically lags the general economy by a significant amount."

Cessna earnings went down by $477 million in the first quarter from the same period last year, Textron reported. Orders for 92 aircraft were cancelled in the first quarter of 2009.

W: www.cessna.com

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