Cessna is slowly ramping up aircraft production at Columbia Aircraft while creditors worldwide wait to see what the bankruptcy court leaves them after settling the liabilities of the all-composite aircraft manufacturer.
Following its acquisition of Bend Oregon-based Columbia in December, Cessna added Columbia's four-seat high-performance piston aircraft to its portfolio in December and simultaneously renamed the aircraft the Cessna 350 and Cessna 400.
Employment has since grown by about 40 to 400 and on 22 January Cessna announced its senior product director for Citation CJ production Mark Withrow would become general manager in Bend. He has also spent 18 months as general manager of Cessna's production facility in Mexico.
The manufacturer says the Columbia purchase has taken precedence over developing its next-generation piston family. "As far as NGP goes, we still have plans for developing a new family of aircraft, but the timetable has slowed down so that we can focus on successfully integrating the 350 and 400," says Cessna.
That integration has been a godsend to owners of those two aircraft. "They're finally getting the parts they need. In six weeks you're not going to get the backlog filled, but now you've got somebody who's actually paying the bills," says Chuck Yanke, president of Columbia owners and pilots group Club Columbia.
He says owners are waiting to see how Cessna resolves their orders for Evade de-icing systems. The manufacturer has committed to pay $4.3 million to install the $25,000 system already sold to customers.
Club Columbia says it will rename once Cessna has rebranded its two new models. "They've assured us by the end of February they're going to have a brand name for the Columbia line," Yanke says.
Until then the name has been bogged down in one of the many lawsuits tied to the original manufacturer including an objection to the sale filed by aviation services company Columbia Air Services, which is asserting a claim on the "Columbia" name.
More than $60 million in unsecured debt has creditors aching to recover what they can. They will divide up what is left after Columbia's liabilities are resolved, and are challenging payments to ING Financial Markets and Bridge Associates, which were brought in to secure new investments and manage the breakup, respectively.
A preliminary hearing on 11 February could reduce ING's $1,150,000 in fees and $50,000 in costs.
Anthony Schnelling, managing director of Bridge Associates, says every action the firm has taken as interim managers will stand up because of ongoing court oversight. "Columbia Aircraft Manufacturing is now an estate without operations, holding assets to be distributed according to the bankruptcy rules," he says.
A committee of unsecured creditors thinks Bridge's costs are too high, according to attorney Ray Streiz, and the sale price was too low. "The creditors were really disappointed that they didn't get much more for the bid in the sale of the assets," he says. Any dollars that leave the estate are basically more dollars out of investors' pockets, he says.
Source: Flight International
