The Economic Downturn Has Devastated General Aviation and the Communities and Local Economies that Depend on Them

For over a year, the general aviation community has been hit particularly hard by the economic downturn and string of negative press coverage. General aviation manufacturing has seen a serious drop in production, orders are down, and companies have been forced to lay off thousands of workers, and in some cases shut their doors entirely. This had had a ripple effect throughout small towns and economies throughout the country.

Overall General Aviation Manufacturing Has Dropped Dramatically

In all major general aviation manufacturers, production has significantly decreased as a result of the economic recession. Some general aviation-based businesses have even had to close their doors permanently, putting thousands of employees out of work.

• The General Aviation Manufacturers Association (GAMA) reports that deliveries fell 41.1% in the first quarter of 2009 compared to the first quarter of 2008.[1]
• According to Aviation Research Group, business aircraft flight activity has dropped an average of 0.87 percent per month from July 2008 to July 2009.[2]
• Air-tax service DayJet shut down operations and filed for Chapter 7 liquidation on September 18, 2008.[3]
• Eclipse Aircraft, a prominent Very Light Jet manufacturer, was first going to be bought out by a Russian bank on January 23, 2009, to be completed on January 30, 2009. However, the deal fell through because the bank became insolvent, and Ecliplse announced Chapter 11 bankruptcy and subsequent Chapter 7 liquidation on February 24, 2009.[4]
• Due to the economic downturn, HondaJet was forced to announce a one-year delay in shipments, pushing back its first delivery from late 2010 to the fourth quarter of 2011.[5]
• Bombardier reduced its 10 year business jet delivery forecast by 15%. The company states that “the industry for new business aircraft will face challenges of a negative public perception about the use of private planes and a difficult economic climate”.[6]

The Economic Downturn has Resulted in Massive Lay-Offs for General Aviation Manufacturers Across the Country Ð Already Over 13,000 Jobs Have Been Lost

In an effort to remain in business, many general aviation manufacturing companies have been forced to lay-off thousands of workers. As a result, cities likeWichita,KS andSavannah,GA have seen their workforce affected most dramatically.

• Hawker Beechcraft has announced two rounds of lay-offs since November, 2007. On November 4, 2008, the company cut 490 jobs.[7] On February 3, 2009, Hawker Beechcraft CEO Jim Schuster announced additional cuts of 2,300.[8]
• On February 10, 2009, Piper Aircraft laid-off 300 employees, roughly one-third of their workforce, and reduced its forecast production to 110 aircraft.[9]
• On March 8, 2009, Gulfstream announced lay-offs of 2,700 workers. The company is the largest employer in Savannah, and has facilities in Texas, Wisconsin, and California .[10]
• Cessna Aircraft has been forced to cut thousands of jobs in Wichita, Kansas and beyond. Between November of 2008 and April of 2009, Cessna cut 4,600 jobs Ð 4,000 in Wichita alone. Additionally, on April 29, 2009, Cessna announced 2,300 more lay-offs with additional cuts to 700 salaried employees in June, 2009.[11]
• Cessna Aircraft announced another round of 1,300 layoffs in June, 2009. “Cessna has laid off half of its employees since the first round of cuts was announced in November”.[12]
• Wichita, KS aviation companies are laying-off at least 9,000 people. The fallout from those cuts could cost this city 25,000 more jobs, according to National Public Radio.[13]

Economic Recession Being Felt At Airports Across the Country; Turbine Operations are Down

• The economic recession came on the heels of near-record level prices for aviation fuel. Robert Olislagers at Centennial Airport in Colorado stated “Of the four FBO’s that operate out of my airport, two have told me that their margins have greatly diminished as they try to absorb the almost daily increasesÉ Aircraft operators in turn will have to either absorb the cost or pass it on to their customers and there is evidence that some charter customers have stopped flying altogether. The ripple effect undermines everyone, including the communities that depend on them.”
• Friedman Memorial Airport Manager Rick Baird stated, “”We, like probably any airport in the country right now, are experiencing a reduction in operationsÉThe economy’s bad, and people are using their aircraft less.” Overall, traffic at the airport has been down 25 to 30 percent in the past year.[14]
• According to the Austin Business Journal, general aviation operations dropped 19% in 2008.[15]
• The Charlotte Observer states, “Federal statistics show a significant decline in flying. In November and December, the Charlotte airport had 4,226 general aviation takeoffs and landings – down 25 percent from the same period a year earlier.”[16]
• According to the North Dakota Aeronautics Commission, fuel sales at Hector International Airport in Fargo, ND were down at 40% at in the winter of 2009. Additionally, airport operations at the same airport were down 13% from 2004.[17]