Hawker Beechcraft chief executive Jim Schuster in a 3 February letter to employees says the company must lay off an additional 2,300 employees before the end of the year in response to declining orders and deliveries and a "host of new challenges".
The cut follows the dismissal of 500 employees in December, after which Schuster had warned that more cuts would be required "due to the increasing severity of the global economic decline."
The lay-offs, when complete, will leave the company with about two-thirds of the 10,000 employees on its staff last year. Nearby Cessna has also announced similar reductions, cutting one-third of its 15,000 employees in the wake of a sharp turndown in Citation jet sales.
© Hawker Beechcraft
Economy aside, Schuster says a combination of other factors have come into play. He notes that the US government's $700 billion troubled asset relief programme "failed to sufficiently loosen credit markets, which are absolutely vital to the success of Hawker Beechcraft and our industry", and that orders from "previously high-volume business segments", predominantly fractionals, have slowed "considerably."
Last but not least, he slams the "some" politicians and the media for casting general aviation as "a wasteful extravagance" instead of a critical business tool and the source of "millions of American jobs". Those sentiments emerged late last year when presidents of the three major automobile makers in the US flew to Washington DC in business jets to ask Congress for bailout money.
Schuster says: "We are undoubtedly facing one of the most severe tests in our company's history."