Czech Aircraft Maker to Lay Off 400   

Czech aircraft manufacturer Aero Vodochody will lay off 400 people from its work force of 2,000 by May due to lack of contracts, officials said Monday. Vaclav Srba, the Czech deputy minister of industry and trade, said the layoff plans was due to low sales of the company's subsonic L-159 trainer jets.

State-controlled Aero has been in trouble since the fall of the communist regime in the region and the loss of lucrative markets in the former East Bloc. Attempting to save the company, the government sold a 35.9 percent minority to The Boeing Co. in 1998 in hopes of tapping new markets. But Aero lost a $1.3 billion deal to supply L-159 jet trainers to India last September, and Czech officials decided to cut their ties with the U.S. airplane manufacturer.

Srba, who also serves as vice chairman of the board at Aero, said the layoffs are part of a strategic plan and not linked to Boeing's departure. He said Aero needs time to develop new products. A new line of AE-270 small passenger planes for 8-12 people is being prepared for certification both in the Czech Republic and the United States, he said.

"If that certification is successful, we will restructure the company accordingly and then possibly look for a new strategic partner," Srba said.

FMI: www.aero.cz