Senior Managers Let Go…
Belt-tightening at Mooney Aerospace Group (MAG) has led tothe departure of two senior managers. MAG’s new CEO and former general counsel NelsonHappy told AVweb the former CEO L.Peter Larson and Operations Manager Dale Ruhmel were let go for financialreasons. Larson, you’ll recall, wasbrought in to replace Roy Norris, who tendered his resignation August 15. “Wewere top-heavy in good management,” said Happy. He said the company’sboard of directors made the decision. Happy said the restructuring reflects thecompany’s new way of doing business and its determination to make a success ofthe Mooney Aircraft Company, which it scooped from bankruptcy earlier thisyear.
…Custom Orders The Goal…
Happy said MAG’s goal is to be building airplanes to orderby the end of the year. “Our plan is not to inventory any aircraft,”he said. He said there were 20 Mooneys in varying stages of completion as partof the acquisition and 10 have been sold. He’s hoping the remainder will befinished and sold by January. From then on, Mooney will custom-build aircraft,and the company hopes to increase production from five per month sometime inthe spring. “Historically, Mooney has sold 70 to 80 aircraft a year,”he said. If the factory-direct sales force of five can muster those orders,Happy said the company will likely be profitable.
…SEC Filing Paints Grim Picture…
That’s a pretty rosy outlook, considering the Securities andExchange Commission filing the company submitted October 16. The report putsMAG’s loss thus far at $99.2 millionand warns the company could go under if it doesn’t find new financing. “Wewill need additional financing; failure to obtain financing will lead to acessation or curtailment of our operations,” MAG writes in thefederally-mandated disclosure. Happy downplayedthe ominous-sounding report in comments to AVweb,characterizing it as a “boilerplate” SEC language. He said most ofthe red ink has spilled from the abandoned JETCRUZER project, which is now forsale. The company, then operating as Advanced Aerodynamics &Structures Inc., built prototypes of a rear-engine turboprop business aircraft.The whole project will go to the highest bidder. “If the right personcomes along, I think it could potentially be a good deal,” he said.
