More Layoffs Loom For Hawker Beechcraft
Hawker Beechcraft has cut 2,800 workers (25 percent of its workforce) since October 2008, but amid a declining backlog and depressed demand company officials expect more cost-cutting and more significant but unspecified job cuts, according to the Wichita Eagle. In the second quarter, the company saw year-over-year delivery numbers drop from 129 to 78. While orders taken from April to June amount to $450 million, cancelled orders during the same period represent $366 million in lost revenue. The route taken in 2009 by NetJets may help explain the market environment that's led Hawker Beechcraft to its latest cost-cutting and cash-conservation plans. NetJets in 2009 cancelled orders for 12 Hawker Beechcraft aircraft and deferred all scheduled deliveries until the end of 2010. "The market conditions remain very challenging," CEO Bill Boisture told analysts. He did not say how many employees he would be laying off or exactly when. But the cuts are coming.
The company's backlog dropped by $500 million from $7.3 billion to $6.8 billion from the end of March to the end of June. The company's sales dropped from $1.03 billion in the second quarter of 2008 to $816.3 million for the same period this year. Meanwhile, lower than expected selling prices on the mid-size Hawker 4000 business jet are expected to push back the new jet line's profitability and break-even point.