Company-Wide Staff Meeting Sets Agenda For Year

ANN REALTIME REPORTING 01.08.09 1100 EST, On Location in Duluth, MN: A company-wide staff meeting at Cirrus Design has just concluded, in which incoming Cirrus CEO Brent Wouters outlined what the planemaker will be doing to keep the company healthy in a wholly unhealthy economic climate.

Just coming off a production staff furlough of 500 employees and other waist tightening in which Cirrus eliminated 290 positions, reduced payroll by 23% and cut down annual expenses "significantly,"  the company has outlined other measures they feel will be necessary to ride out the economic maelstrom of bad news and reduced liquidity.

The economic downturn has hammered general aviation, with no company having been excepted from furloughs, layoffs and reduced sales. Cirrus has come out fighting with a "No Money Down" sales program that pretty much knocked 10% off the list price of their SR20 and SR22 offerings, but even that was not enough to hold back the fact that potential customers were loathe to spend money when there was so much bad news at every turn and a bombardment of negativity from general media.

Cirrus finished up 2008 with sales of 549 new aircraft and 114 used... some 23% down from 2007 in which 710 new and 100 used birds took to the sky. December '08 deliveries went from '07's high of 142 to this year's total of 73 aircraft. Overall sales went from 2007's total of 90, to some 46 last month. While far better than a lot of the news we hear from the GA quarter, it's become obvious to all that GA is in for a period of tight belts and tougher sales conditions.

So... for 2009, Cirrus will reconfigure the company to reflect the realities of what has become a worldwide "depression." With production restarted at 8 airplanes per week, for the moment, Cirrus is determined to "do the right thing" by maintaining the 8 aircraft per week delivery and expense structure for as long as may be necessary. Some employees are being offered extended furloughs with extended benefits and other aids, while reorganizing staffing to meet the needs of the reduced production level and some layoffs are anticipated, though the first positions affected will be "indirect" positions.

Cirrus emphasizes that it is determined to maintain their "good position" in this current economy for as long as may be necessary and that they were early in anticipating the changes necessary through aggressive actions such as the elimination of over 75 aircraft from their inventory, the reduction of their debt load by over $20 million dollars, the reduction in annual expenses by 36 million dollars, and the reduction of their "break-even" point from 600 airplanes to only 400. Wouters is confident that this puts Cirrus in a "good position to remain competitive and grow."

ANN will have more info on this story as it becomes available.

FMI: www.cirrusdesign.com