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Jul. 2--Gulfstream Aerospace on Monday furloughed about 2,200 employees involved in the manufacture of four of its large-cabin aircraft in Savannah. The furloughs will last from four to five weeks.
Those working on the fifth large-cabin model, the new Gulfstream G650, were not affected. But even they have not been immune to a fragile economy, drawing a two-week assembly line furlough in early April to allow parts deliveries to catch up.
Of those currently furloughed, 1,500 are involved in the initial phase manufacture of the Gulfstream G350, G450, G500 or G550 business jets. They will return Aug. 3.
Another 700 employees involved in the final phase manufacture of the same models will return to work July 27, according to Gulfstream spokesman Robert Baugniet.
Although they won't be paid for the period, those furloughed are still Gulfstream employees and, as such, all benefits will continue, Baugniet said.
"Benefits will be paid and pensions will accrue," he said, adding that employees on furlough cannot be terminated.
Furloughed employees can, however, apply for unemployment for the period they aren't paid, Baugniet said. They also have the option of taking paid vacation for all or part of the period.
New products on schedule
In early March, Gulfstream's parent company, General Dynamics Corp. (NYSE: GD), lowered its 2009 earnings guidance and predicted weaker sales of its mid-size and large-cabin jets than previously forecast.
The company reduced its expected production of large-cabin aircraft -- all of which are built in Savannah -- from 94 to 73.
At the same time, General Dynamics CEO Nicholas Chabraja announced the mid-summer furlough of initial phase manufacturing personnel, a move designed to bring the production rate down accordingly. The decision to also furlough final phase employees came sometime later.
Meanwhile, progress on the Gulfstream G650, the company's largest-cabin, longest-range and fastest business jet, "continues unabated," Baugniet said this week.
Unlike its other four large-cabin aircraft, Gulfstream's flagship G650 is still in the development stage. It's designed to carry eight passengers and a crew of four on nonstop legs of 7,000 nautical miles, covering shorter distances at just under the speed of sound.
"The speed and ease with which the wing join, engine mount and fuselage components came together is a tribute to the people who designed and manufactured these major parts," said Pres Henne, senior vice president for programs, engineering and test at Gulfstream.
The G650 is on track to take its first test flight later this year and will be available for delivery in 2012. It carries a price tag of approximately $58 million.
The company's new super mid-size Gulfstream G250, with its initial phase manufacturing at Israel Aerospace Industries near the Ben Gurion International Airport, also remains on track, with a first test flight later this year and delivery beginning in 2011.
Signs of recovery?
While aircraft production has slowed in response to a still-sluggish economy, Gulfstream's Research and Development arm remains active, Baugniet said.
"We continue to do research on sonic boom suppression, the use of composites, acoustics and advanced cabin and cockpit systems."
And, while sales of the company's G150 and G200 models remain flat, Gulfstream is beginning to see renewed interest and orders for its large-cabin models, particularly the G550.
"And the order book on the G650, which will begin deliveries some three years from now, remains firm," he said.
Because the company continues to provide service to the majority of Gulfstream planes currently flying, it also may be among the first to notice another positive harbinger of better times to come.
"We've begun to notice a modest uptick in the number of flight hours," Baugniet said. "We should know by the end of this month if that's a real trend or just a blip."
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Gulfstream layoffs and furloughs in 2009
March 6: Company announces the layoffs of 1,200 workers, about half contract workers and half permanent employees. The cuts are concentrated in Savannah, where about 6,000 of Gulfstream's workforce of 9,700 are based.
April 6: Gulfstream puts 170 employees working on the production line of the company's new flagship G650 business jet on a two-week furlough. Delays in shipments from crucial suppliers had slowed production, and the furloughs were to allow essential parts to be delivered.
June 29: About 2,200 employees involved in the manufacture of the large-cabin G350, G450, G500 and G550 models at Gulfstream's Savannah facility began a scheduled furlough of four to five weeks.
