Like everyone on this site I hope the job cuts are only a temporary blip. But I am a little surprised about everyones reaction, the general summary seems to be everything will be okay - on what information is that based.
I would like to be alittle sceptically without being flamed to death
So Cirrus stated they would aim for 1 a day in the fall last year, in December at the 100th customer shipment they stated 300+ planes for 2001. Now all of a sudden they lay off 100 people and say they will stabilize production at 1 a day. In the meantime the max they have shipped is 13 in a month.
So why didn’t they get to 1 a day - production bottle necks, cash flow, slow parts deliveries intro of SR22 model etc. why will cut backs enable them to meet the targets ?
Before paying another installment for my plane I would like to know that Cirrus has a plan and can honour the delivery date of September 2001.
Cirrus Design to lay off 120 in restructuring
Mike Blahnik; Staff Writer
Star-Tribune Newspaper of the Twin Cities Mpls.-St. Paul
Duluth-based Cirrus Design Corp. said it would lay off 120 workers, about 18 percent of its work force, as part of a restructuring to improve efficiency.
The company, which manufactures four-seat, single-propeller airplanes equipped with parachutes, said its business remains strong and that it has an order backlog of 660 aircraft. It hopes to begin rehiring workers in about three months, spokesman Ian Bentley said.
“This isn’t an economic downturn issue . . . this really is just a sort of hiccup in the growth process. It’s a step backward before charging on,” Bentley said.
Cirrus currently employs 471 at its Duluth plant, 155 at its fuselage production plant in Grand Forks, N.D., and 18 at a paint shop in Hibbing, Minn.
Cirrus, a privately held company, delivered its first plane 19 months ago and its 100th in December. The production rate had ramped up from one plane about every four days in early summer to one per day in December.
“That’s exactly the issue,” Bentley said. “It was during that process that we recognized that the way we were doing it was so horribly inefficient, and that we had to retrench.”
Cirrus originally planned to produce 300 planes in 2001.
“Initially the production rate will go down, then our intent is to come roaring back,” he said. “This will just make us leaner and meaner. We hope to get a good number of these people back and go on from there.”
The layoffs, which affect workers in all areas of the company, began Friday. Employees were told of the cuts Thursday.
The company said it will announce more details of the restructuring at a news conference Monday.
While Cirrus hasn’t turned a profit, the company has managed to pay its bills with help from private investors, revenue from sales of its SR20 plane and down payments that people have made for future airplanes.
Would-be owners of an SR20 must put down $15,000, and prospective pilots must put down $30,000 for the new SR22, introduced by the company in October.
The company took 45 new orders in January.
“We’re producing a great airplane, and there’s plenty of interest in it,” spokesman Chris Maddy told the Associated Press. “But we’re not pumping them out the way we need to be” to be profitable.
Cirrus has shipped 110 SR20s, which has a 200-horsepower engine and a base price of $198,000.
The company expects to make its first delivery of the new SR22 soon. The 310-horsepower plane has a base price of $277,000, and about 200 have been ordered.
Mike Blahnik can be contacted at firstname.lastname@example.org