Lancair's Waiting Game
Cash Influx Gets Company Rolling (Slowly)...
It seems that Lancair's certified aircraft division, which has been out of production with more than 170 orders on their books -- and lots of drool on the press photos over here -- may be poised, but not yet ready, to resume production. A deal has been struck that according to company President Bing Lantis would land "substantially in excess" of the $25 million it had been seeking earlier this year. The deal has not yet been sealed but is in its closing stages now. The company expects this process to take approximately 30 days. In the meantime, Lancair has received bridge financing that will allow them to begin making preparations to ramp up production as soon as the final financing hits the bank. In the meanwhile, the company will begin cautiously rehiring employees, and currently aims to restart production early next year. The company will rehire 50, or about half, of its engineering and manufacturing planning positions on December 2 and plans to bring back 70 of its direct production workers January 2. Currently, the goal is to bring back all workers by April. "Our strategy will remain the same," Lantis said. "Ultimately we will be staffing up to whatever level we need to run profitably." Lancair had released about 277 employees in June and July, when costs of production overwhelmed its production schedule of one plane a week. While a few weeks ago Lancair officials indicated they were near signing a deal with a single buyer, all the recent investment capital came from existing shareholders. Until the money is in the bank is possible that things may change again.
...But First Things First
While Lancair is ready to jump back into production, it must first deal with its creditors. According to Lantis, the company will begin repaying its vendors and working its way through a backlog of more than 170 planes. "Everyone we owe money to will be paid off, hopefully by the end of the year," Lantis said. The Associated Press reports that Precise Flight, one of Lancair's suppliers, holds a claim of about $10,000. The Bend, Ore., parts company manufactures speed brakes and electronic components for Lancair, which account for about 5 percent of its total business. "I'm excited about having them back and running," Philibin told the AP. "The rising water floats all boats," he added. Even with the slow return to a "normal" production schedule, some internal restructuring has been made, including some changes in the board of directors. For some time now, a Malaysian investor group -- called CTRM -- has held half the seats on the board and holds over half the equity in the company. It is uncertain how (or if) this balance has shifted after the internal shuffle.