Monday, October 10, 2011

Industry decries Obama aviation charges

Las Vegas -- United States President Barack Obama did not attend the 64th annual meeting of the National Business Aviation Association here this weekend. And a good thing it was, as the industry that is raging against his administration's intention to impose a $100-per-flight landing fee for private jets and lengthen the depreciation schedule for such planes in a move that could cost as much as $60 million.

Executives of several business aircraft manufacturers denounced the plan Sunday as self-defeating and an unfair bashing of the general aviation industry that provides good jobs.

But none topped Hawker Beechcraft chairman and chief executive Bill Boisture Jr., who made it personal.

Deeply flushed at a news conference, he called Obama and his administration "nothing short of irresponsible," arguing that the measures would hamstring the industry in a delicate recovery period and would cost many U.S. aerospace jobs.

"I know for a fact - for a fact," Boisture said, "that (Obama) was personally briefed on the effects of these measures" but that he chose to ignore the harm they would do to U.S. jobs at the worst possible time, repeating the term "irresponsible."

In a brief interview later, Boisture told The Gazette that "I'm focused on American jobs."

He accused the administration of playing politics by "labelling a class of people who are capable because of their hard work, their innovative investments and their risk, of affording business airplanes. It focuses on that at the expense of thousands of good-paying U.S. jobs."

But his accusations came immediately after Boisture himself announced that Hawker Beechcraft had moved, and would continue to move, jobs to its new plants in Monterrey and Chihuahua, Mexico, and elsewhere.

Asked why that was not a contradiction, Boisture replied that "I'm outsourcing because we at the company are competing against foreign subsidized (rivals) who are able to operate at lower cost in R&D."

He would not say if he meant Bombardier Inc., the world's largest business aircraft manufacturer.

The Montreal business and commercial aircraft maker is one of only two non-U.S. business-jet producers, along with Brazil's Embraer.

The other two major U.S. business aircraft firms are Gulfstream Aerospace Corp., a division of General Dynamics, and Cessna Aircraft Co. of Wichita, Kan.

Danielle Boudreau, spokesperson for Bombardier Aerospace's business aircraft division, said that "we don't get any subsidies at all - neither in Canada nor at (Wichita-based) Learjet. So I don't know who he's talking about."

Jean Rosanvallon, president of France's Dassault Aviation, told The Gazette "it's not fair. We seem to single out business aviation as being for rich people. But unions are siding with us also."

Companies are inciting unions to lobby on behalf of their respective employers. It worked in the case of Hawker Beechcraft, whose union president wrote an opinion piece in a Chicago newspaper - Obama's hometown - castigating him for his stance. The administration argues that people who can afford $10-million to $60-million jets should do their part to reduce the deficit and shoulder the burden alongside the working and middle classes.

Rosanvallon said that "a landing fee is not going to reduce the deficit. Jobs will."

He conceded Dassault is also outsourcing jobs, "but in our case, 99 per cent of jobs are still in North America and Europe. Outsourcing is still a small part. I know it's a bigger part for our friends in Canada."

Bombardier has a large plant in Queretaro, Mexico, where suppliers like Longueuil's Heroux-Devtek have also set up shop.

Since the heydays of early 2008, when the business aircraft industry had soared to unprecedented highs in its 50-year history, the business has slumped. The most expensive models, including Bombardier's Global 5000 and 6000, have recovered and are flourishing again.

The lower end, including Bombardier's Challenger brand, but especially its Learjet line, is still depressed.

Ralph Acs, vice-president and general manager of the Learjet division, said in an interview that the cuts made at the division are enough for now, barring another catastrophic collapse like in 2008.

Thousands of jobs are at stake in the Montreal area and Downsview, Ont., where Bombardier has large business aircraft factories.

Boudreau said that Bombardier Aerospace employs 20,000 people in Canada, 15,200 of them in the Montreal area and 4,100 in Ontario. But there's no breakdown of how many work in business aircraft because some plants, like the one in St. Laurent, produce parts and do work on the entire range of Bombardier planes, from the Q400 turboprop assembled in Toronto, to the regional jets and the burgeoning CSeries airliner due out in 2013.

http://www.montrealgazette.com

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