Latest Company To Feel Effects Of Economic Slump

The latest stop by The Recession Fairy is Kerrville, TX. Mooney Aircraft announced Wednesday it will cut production as it tries to sell excess inventory into a slumping marketplace... and fewer planes in production means fewer workers will be needed to build them.

The San Antonio Business Journal reports Mooney laid off 229 employees in Kerrville. Company spokesman Dave Franson said the cutbacks are needed to "balance its finished airplane inventory with current demand.

"These are temporary adjustments and they only affect our manufacturing operations," Franson added. "So our (other operations) will continue to operate normally and be staffed at the normal level. There will not be any change to existing or potential customers and we will deliver airplanes as scheduled."

Mooney CEO Bob Gowens told state employment officials the company couldn't have seen the latest round of layoffs coming.

"These unexpected and unforeseeable conditions are beyond Mooney Airplane Company's control," Gowens wrote in a letter to the Texas Workforce Commission. "It was impossible for Mooney Airplane Company to predict this sudden collapse in demand at the time when notice would have been required."

As ANN reported, Mooney laid off 80 workers in June, leaving about 320 workers at its plant at Schreiner Field (ERV).

Mooney's normal production has been running at about a hundred planes a year. The production cut comes in a week which has already seen Grob Aerospace enter full insolvency, and Cessna and Hawker Beechcraft announce production and workforce cuts.

Franson said the latest layoffs were effective immediately, and will leave about 91 employees at Mooney. The company hopes to start building airplanes again when the economy rebounds and demand increases, he added.

FMI: www.mooney.com