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Feb 3, 2009

Hawker Beechcraft to lay off 2,300 amid business jet slump

In yet another troubling sign that the business jet market is the midst of a full-blown tailspin, Hawker Beechcraft Corp. announced Tuesday it would layoff roughly 2,300 of workers by year end as it struggles with slowing orders and a tight credit market.

The news follows the nearly 500 layoffs at the Wichita-based aircraft manufacturer late last year, and announcements last week that business jet deliveries would slow substantially this year at General Dynamics' Gulfstream and Textron Inc. Cessna on waning demand.

Cessna said it would layoff an additional 2,000 workers to compensate, in addition to the 2,600 it had already announced over the past two months.

"This is an extremely painful step for the HBC family and community, but one that is absolutely necessary," Jim Schuster, Hawker Beechcraft chief executive, was quoted saying in a letter to employees. "While I wish I could commit to you that this will be our final action, I cannot do so at this time given the extreme volatility in the marketplace."

Hawker, which is 20% owned by Toronto-based Onex Corp., had roughly 9,800 employees on staff prior to the announcement Tuesday, and is saddled with approximately $2.4-billion of debt, according to a previous letter from the company.

Source : Financial Post
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