manufacturer Aero Vodochody will lay off 400 people from its work
force of 2,000 by May due to lack of contracts, officials said
Monday. Vaclav Srba, the Czech deputy minister of industry and
trade, said the layoff plans was due to low sales of the company's
subsonic L-159 trainer jets.
State-controlled Aero has been in trouble since the fall of the
communist regime in the region and the loss of lucrative markets in
the former East Bloc. Attempting to save the company, the
government sold a 35.9 percent minority to The Boeing Co. in 1998
in hopes of tapping new markets. But Aero lost a $1.3 billion deal
to supply L-159 jet trainers to India last September, and Czech
officials decided to cut their ties with the U.S. airplane
Srba, who also serves as vice chairman of the board at Aero,
said the layoffs are part of a strategic plan and not linked to
Boeing's departure. He said Aero needs time to develop new
products. A new line of AE-270 small passenger planes for 8-12
people is being prepared for certification both in the Czech
Republic and the United States, he said.
"If that certification is successful, we will restructure the
company accordingly and then possibly look for a new strategic
partner," Srba said.