Friday, August 15, 2014

Eclipse Aerospace announces layoffs

Randy Siner | Albuquerque Business First
 Just nine months after getting $238,000 from the city and $397,000 from the state​ to hire 100 new workers, Eclipse Aerospace laid off several people on Friday. The company has delivered 10 ​new Eclipse 550 jets since March, when it had a major press conference to announce ​its first sale of a 550. 

Just nine months after getting $238,000 from the city and $397,000 from the state to hire 100 new workers, Eclipse Aerospace laid off several people on Friday.

“I’ve had much better days,” Eclipse Aerospace senior vice president Ed Lundeen told Business First on Friday.

“The bottom line is that the market has not recovered yet. We’re not seeing the sales we planned for,” he said.

Lundeen said the company is not disclosing how many people it laid off, though it had about 220 employees. The company did offer a severance package, though Lundeen declined to offer details.

The company has delivered 10 new Eclipse 550 jets since March, when it had a major press conference to announce its first sale of a 550.

“The people that are buying them love flying it,” Lundeen said.

However, just last December, Eclipse announced that it was receiving help from the city and state, and that it was hiring 100 new workers. The city pitched in $238,000 from its Economic Development Action Fund and the state pitched in $397,000 in Local Economic Development Act funds.

The state instituted clawbacks on its LEDA funding; however, those will not go into effect in this case. “I don’t believe this layoff would affect that. I know this layoff wasn’t big enough,” said Angela Heisel, spokeswoman for the state’s Economic Development Department on Friday.

The city deal, however, includes a performance-based clawback. The mayor could not immediately be reached for comment.

The aviation market has not rebounded as much as the company would have liked, Lundeen said.

“We just wish there were more people that are wanting to buy aircraft,” he said. “As a result of that, we’ve had to realign our production forecast. We’re building less airplanes, and we need fewer human resources.”

“We lost a lot of really good folks today, across the board — Albuquerque, Chicago and Charleston — and it’s a painful event we’re going through,” he added.

“We have to keep our costs in line so we have a sustainable business model,” Lundeen said.

ALBUQUERQUE (KRQE) – Albuquerque’s Eclipse Aerospace confirms it has laid off a significant number of employees at its New Mexico aircraft factory. The company would not specify an exact number, but several employees were seen Friday morning carrying out personal effects in boxes.

Eclipse Senior Vice-President Ed Lundeen blames the layoffs on the economy, especially the general aviation segment.

“This is a function of market conditions and our efforts to reduce costs of the company,” Lundeen said. “As a result of these cost reductions we are going through a restructuring at the present time to insure the long term viability of this company.”

Eclipse had recently reduced its production schedule and was still struggling to find buyers of its light jet, the twin-engine Eclipse 550.

One employee laid off this morning who preferred not to give his name said, “I’m not too dismayed by it, because the economy itself is somewhat in a tizzy right now. It was a pleasure to work for Eclipse and I hope to be back,” he added.

Lundeen said Eclipse will continue to manufacture planes and staff its service centers around the country, just at a slower pace and with a smaller staff.

“We’re very hopeful that when the economy recovers, and we start selling more aircraft that we will post positions for restaffing,” Lundeen said. “And we hope that these employees that were laid off today will reapply to come back to work for us.”

Albuquerque’s Economic Development Director Gary Oppedahl issued this statement Friday regarding the Eclipse news;

“We need to diversify our economy, those efforts have led to recruiting world-class businesses like Eclipse. Like many successful companies, it is incumbent upon them to flex to the demands of the market. It is our understanding that Eclipse has a plan to reabsorb staff, once their market conditions improve. In our agreement with Eclipse they only receive rental discounts when they are actively hiring. We anticipate they are still on track to hire 100 people, for a total of 275 employees, by December of 2015, as that is part of our contractual agreement with them.”

Story, photo and comments:

Eclipse Aerospace manufacturing takes off with first delivery

ALBUQUERQUE (KRQE) – Eclipse Aerospace announced that it has reached a major milestone Wednesday morning.   

They say it is a good sign that its jet manufacturing operation is taking off.

    Eclipse Aerospace Official Press Release»

Eclipse Aerospace has delivered its first Eclipse 550 Jet to a customer, a big step forward for the company following certification by the FAA.

The company first announced production of the 550 jet in Albuquerque in June of 2012.

Eclipse says the jet can fly at 430 miles per hour, at an altitude of up to 41,000 feet and is the most fuel-efficient small jet in production. When in cruise, the 550 consumes only 59 gallons of fuel per hour.

Eclipse says it also features safety features and technology traditionally found on commercial aircraft.

Last September, Eclipse unveiled the new jet at a convention in Las Vegas, Nevada.

Eclipse says production of the jet, which runs at approximately $2.9 million, is ramping up and so is customer interest.

In 2008, the former company, Eclipse Aviation, filed for bankruptcy and laid off its workers.

Eclipse Aerospace CEO Mason Holland told KRQE  News 13 this is a big step forward for the company and for the city that saw Eclipse Aviation collapse.

“It’s got to be big for Albuquerque as well, because it marks a signal of a milestone we’ve achieved after four years of pretty hard work,” Holland said.

Holland wouldn’t release hard numbers, but said a good number of orders are lined up for the year.

Eclipse is now looking toward the future, and possibly expanding its product line beyond the 550 jet. A spokesperson for the company couldn’t expand on what other aircraft Eclipse could be developing, but said final production of any product would likely stay in Albuquerque.

Right now, 175 people are employed at Eclipse.

A recent partnership with the city, state and Eclipse is supposed to help expand the company, with both the city and state giving the company a total of more than half a million dollars.

The partnership is expected to result in at least 100 new manufacturing jobs over the next two years, bringing the number of employees at Eclipse in Albuquerque to 275.
Council approves helping Eclipse Aerospace 

ALBUQUERQUE (KRQE) – The Albuquerque City Council voted 6-0 Wednesday night to shell out more than $238,000 to help Eclipse Aerospace grow. Three council members, Klarissa Pena, Brad Winter and Dan Lewis, were absent from the meeting. 

The company wants to add 100 high-paying jobs over the next few years. To help make that happen, the funding from the city, and $397,000 from the state, will go toward paying for Eclipse’s space at the Sunport so the company could spend more on hiring.

Right now, 175 people are employed at Eclipse, but owners want to add to its workforce as it ramps up production of its new 550 jet.

But, if Eclipse fails to meet its goal, or it goes belly-up within the next 10 years, the company will have to pay penalty payments to the city.

Eclipse’s old owners declared bankruptcy in 2008.


  1. Just this year Eclipse received $238,000 from the city and $397,000 from the state​ to hire new workers, and now they are laying-off employees.

    What is going on with GA!?!?

    I guess we'll soon be reading about Kestrel Aircraft and it's ongoing downward spiral. Anyone with any business sense would have done their due diligence on Kestrel Aircraft before giving them any money.

  2. The state and city monies amount to $635K. What do you think it costs to have 100 employees for 1 week? That $635K is just a drop in the bucket.

  3. Folks aren't purchasing planes because:

    The Obama economy stinks and it's going to get a lot worse;

    Too many fatal crashes --- just this past week alone the U.S. had twenty-five (25) fatalities with general aviation aircraft.