18 January 2008

Colorado's Aerospace Industry in Trouble

Centennial Airport-based Adam Aircraft said it laid off about 300 employees — more than a third of its workforce — as it seeks more funding. . . . Adam's layoffs come after Aviation Technology Group, also based at Centennial Airport, in December suspended work on its Javelin jet and let go almost all of its employees as it seeks more funding.

"There's a lot of turbulence in the (very light jet) market right now," said Tom Cappalletti, president of Broomfield- based Professional Jet Aviation Consultants. "What you're seeing is a shakeout in the VLJ market" because large, established aircraft manufacturers, including Cessna and Embraer, are introducing very light jets that compete with those developed by startup companies.

"People like ATG and Adam probably will suffer," Cappalletti said.

From The Denver Post.

Earlier this month, Andrew Romanoff, Speaker of the Colorado House of Representatives, specifically hyped the growing industry that these companies represent in his opening day remarks stating: "we should support homegrown industries like aerospace, bioscience and renewable energy – industries in which Colorado is already gaining a competitive edge."

The Colorado General Assembly has also recently passed tax incentives for this industry.

Their collapse at the moment, therefore, while not huge in terms of absolute numbers of lost jobs, is a huge blow to the state's perception of its own economy. The news coincides with rising unemployment in Colorado, even though the absolute unemployment rate of 4.5% is not catastrophically bad.

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