Vancouver-based Avcorp won a $24.7 million award yesterday from Cessna Aircraft due to damages suffered as a result of the Wichita aircraft manufacturer’s transitioning contracted production work from Avcorp. The two parties could not come to terms in mediation and negotiations after the December 2010 announcement about the transition of Avcorp’s production work to Cessna, so the matter was referred to binding arbitration. The arbitrator ruled in favor of Avcorp and all counterclaims from Cessna were denied.
Bombardier Learjet’s unionized employees in Wichita, members of the International Association of Machinists and Aerospace Workers (IAMAW), are back on the job after a five-week strike. Over the weekend, the Learjet production line workers voted to accept a proposed contract agreement, ending a strike that began on October 8.
Citing its intention to emerge from Chapter 11 bankruptcy protection as the standalone Beechcraft Corp., Hawker Beechcraft notified employees yesterday that it will begin the process of closing Hawker Beechcraft Services facilities in Little Rock, Ark.; Mesa, Ariz.; and San Antonio. The Wichita-based OEM also affirmed that approximately 240 employees will be affected at these locations.
Though the light and midsize jet markets yet await their resurgence from the depths of the past business cycle downturn, at Learjet there is a near palpable sense of anticipation that such a turnaround is looming. The Bombardier division currently has three new models preparing for entry into service next year—the Learjets 70, 75 and 85–and has embarked on a major expansion at its Wichita headquarters.
Bombardier is moving to upgrade its customer product support and training options. To that end, the company announced a major expansion of its service capabilities, including deployment of a fleet of mobile response trucks and three new regional support offices co-located with Bombardier factory-owned maintenance facilities in Tucson, Hartford and Fort Lauderdale.
After four months of intense negotiation, a deal for the sale of Hawker Beechcraft to Superior Aviation Beijing collapsed October 18 with an announcement by HBC that the parties could not come to terms and it would proceed with the stand-alone plan of reorganization.
A 12-day visit to China by a trade delegation from Wichita got off to a somewhat rocky start on Sunday when a scheduled meeting with Hawker Beechcraft suitor Superior Aviation Beijing was cancelled abruptly due to “sensitivity of the ongoing negotiations.” Superior Aviation submitted a bid in July to purchase bankrupt Hawker Beechcraft for $1.79 billion but an exclusivity period for negotiations granted by the court expired on September 1.
A business delegation from Wichita, headed by Mayor Carl Brewer, plans an extensive trip to the People’s Republic of China, and the possible sale of Hawker Beechcraft to Superior Aviation Beijing is likely to be a subject of discussions there. While examining business relationships and renewal of the sister-city relationship with Kaifeng, Brewer said he expects to meet with Superior Aviation chairman Cheng Shenzong on Sunday.
Bombardier Learjet workers in Wichita represented by the International Association of Machinists and Aerospace Workers (IAMAW) went on strike early yesterday morning, following a vote on Saturday to reject a proposed labor agreement. Members of IAM Local 639 overwhelmingly rejected Bombardier’s proposal, with 79 percent opposed to the five-year offer. An equal number of union members authorized a strike, setting the stage for the walkout yesterday.
Hawker Beechcraft, which is in the process of restructuring under U.S. Chapter 11 bankruptcy protection, posted a $33.8 million net loss on sales totaling $149.9 million last month. In documents filed with the U.S. Bankruptcy Court in New York earlier this week, the company reported spending $1.5 million on restructuring costs, $5.4 million on reorganization items and $8.8 million on research and development.