Lays Off 80 Workers, Cuts Production Rates
Blame the following on the slumping
economy... and it may be a sign of things to come. Mooney
Airplane Company announced Tuesday morning it has slowed production
rates for its aircraft for the rest of 2008, and laid off a sizable
percentage of its workforce.
"In light of our current order levels, we have decided to slow
our production rate from 8 aircraft to 5 per month for the
remainder of 2008," Mooney CEO Dennis Ferguson. "While this action
will allow us to better control inventory and reduce production
costs, it will have an impact on our work force. Effective
Tuesday, June 17, we will reduce our employment by approximately 80
"In order to assist the affected employees we will provide a
severance package and career transition support," Ferguson
Mooney cites industry statistics released earlier this year by
the General Aviation Manufacturers Association (GAMA), noting
piston engine aircraft deliveries are down 28% for the first
quarter of 2008, compared to the same period in 2007. That doesn't
bode well for a number of general aviation planemakers... but hits
niche-manufacturers like Mooney especially hard, as its entire
product line is piston-powered.
In response to current US market conditions, Mooney has
implemented numerous measures to improve efficiencies and reduce
cost, including the adoption of LEAN manufacturing initiatives.
Ferguson says the company is also focusing its efforts in overseas
markets, that are experiencing growth.
"These decisions will not have an adverse effect on the quality
or safety of our products nor will they delay scheduled aircraft
deliveries. They were made to create corporate resiliency in the
present economic conditions. Our plans include positioning Mooney
as a strong contender in the international market," Ferguson
stated. "We are strengthening our business in Europe, South America
and Australia, where Mooney's high performance, efficiency and
pricing are especially appealing. Our focus is to ensure the
long-term viability of the company through prudent management and
expansion of our market reach."
As ANN reported, Mooney
recently received certification for the Model M20TN Acclaim and the
Acclaim Type S from the ANAC, the Brazilian aviation certification
authority. Other recent international certifications for the
Acclaim include Civil Aviation Safety Authority (CASA) in
"The Mooney name has earned its place in the distinguished
company of aviation legends," Ferguson concluded. "Since 1946 the
story of Mooney has been one of constant innovation, industry
leadership and the passion for flight. Our commitment is to
continue the Mooney story."