Cessna plans production cut, layoffs

The light end of the business jet market is being pinched as hard by the recession and the credit crisis as the rest of the industry. Cessna, a unit of the US Textron aerospace and industrial group, said on Thursday that it is reducing 2009 production of aircraft by 20 per cent and will cut its workforce by another 2000 by March.

That brings total layoffs announced since January 1 to 4200, about 30 per cent of its workforce. The layoffs will mainly be at its Wichita, Kan, plant – which now employs 12,000 - but plants in Independence, Kan, and Columbus, Ga, will also be affected.

Cessna builds a variety of general-purpose aircraft, but its Citation business jet is a big seller worldwide, and competes with Bombardier's small Learjets. Cessna expects to deliver 375 Citation jets this year, down from a record 467 in 2008. It took 30 new orders in the final quarter of 2008 and received 23 cancellations and many deferrals.

The company has yet to decide how production of its small propellor aircraft will be affected. Total backlog on December 31 was $14.5 billion US, down seven per cent from September 30. Cancellations and deferrals have been spread across the whole range, Cessna said, but orders for its new Mustang very light jet have been "robust."

Overall deliveries will be slow in the first quarter this year, improving in the second quarter, the company said.