Company-Wide Staff Meeting Sets Agenda For Year
ANN REALTIME REPORTING 01.08.09 1100 EST, On Location in
Duluth, MN: A company-wide staff meeting at Cirrus Design
has just concluded, in which incoming Cirrus CEO Brent Wouters
outlined what the planemaker will be doing to keep the company
healthy in a wholly unhealthy economic climate.
Just coming off a production staff furlough of 500 employees and
other waist tightening in which Cirrus eliminated 290 positions,
reduced payroll by 23% and cut down annual expenses
"significantly," the company has outlined other measures they
feel will be necessary to ride out the economic maelstrom of bad
news and reduced liquidity.
The economic downturn has hammered general aviation, with no
company having been excepted from furloughs, layoffs and reduced
sales. Cirrus has come out fighting with a "No Money Down" sales
program that pretty much knocked 10% off the list price of their
SR20 and SR22 offerings, but even that was not enough to hold back
the fact that potential customers were loathe to spend money when
there was so much bad news at every turn and a bombardment of
negativity from general media.
Cirrus finished up 2008 with sales of 549 new aircraft and 114
used... some 23% down from 2007 in which 710 new and 100 used birds
took to the sky. December '08 deliveries went from '07's high of
142 to this year's total of 73 aircraft. Overall sales went from
2007's total of 90, to some 46 last month. While far better than a
lot of the news we hear from the GA quarter, it's become obvious to
all that GA is in for a period of tight belts and tougher sales
conditions.
So... for 2009, Cirrus will reconfigure the company to reflect
the realities of what has become a worldwide "depression." With
production restarted at 8 airplanes per week, for the moment,
Cirrus is determined to "do the right thing" by maintaining the 8
aircraft per week delivery and expense structure for as long as may
be necessary. Some employees are being offered extended furloughs
with extended benefits and other aids, while reorganizing staffing
to meet the needs of the reduced production level and some layoffs
are anticipated, though the first positions affected will be
"indirect" positions.
Cirrus emphasizes that it is determined to maintain their "good
position" in this current economy for as long as may be necessary
and that they were early in anticipating the changes necessary
through aggressive actions such as the elimination of over 75
aircraft from their inventory, the reduction of their debt load by
over $20 million dollars, the reduction in annual expenses by 36
million dollars, and the reduction of their "break-even" point from
600 airplanes to only 400. Wouters is confident that this puts
Cirrus in a "good position to remain competitive and grow."
ANN will have more info on this story as it becomes
available.