In a difficult but necessary move, Adam Aircraft Industries suspended operations today at its facilities in Colorado. This measure was required due to the inability of the company to come to terms with their lender for funding necessary to maintain business operations.
The company is currently exploring all of its alternatives and will provide further guidance when decisions are made, which is expected to be later this week.
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In the light of this news how do you view Adam Aircraft's previous press release titled:
Adam Adam Aircraft Announces Strategic Adjustment To Streamline Processes to Achieve Goals
Englewood, Colorado, January 17, 2008 —- Adam Aircraft has been strengthening its operations throughout this past year with significant progress towards obtaining A700 Type Certification and improving production processes through its Make Production Fly (MPF) program. As a result of the company's ongoing evaluation of the processes and resources needed to achieve its vision and milestones, Adam Aircraft is making a revision to the company's overall production plan.
"Adam Aircraft Industries is announcing today a strategic adjustment in operations designed to focus on two key objectives: obtain a TC on our A700 jet design and complete our "MPF" initiative," said Adam Aircraft President Duncan Koerbel. "To provide for our future growth, we must be strategic in our focus by managing current cash expenditures to ensure adequate time to secure financing for the long term. We're off to a good start in this effort with assistance from our partner, Citibank, but we need to be able to provide them with sufficient time working with potential investors to secure long term financing."
The necessary strategic adjustment for Adam Aircraft will reduce resources to match the revised production and spending plan resulting in the following actions:
Operations at Ogden will be suspended through early summer and we are rescheduling the completion of the composite lay-up portion of the Ogden facility.
Transfer of the lay-up and bonding operations for the empennage from Pueblo to Englewood. Machine shop operations will continue in Pueblo, but all other activity will be suspended.
Reductions in expenses and labor commensurate with the revised production plan.
"We regret that these actions will result in a layoff for many of our employees, but it is in the best interest for the long term success of Adam Aircraft Industries. We have two excellent products in the A500 and A700 with a very strong global market and will continue to move the company forward in achieving our goals."
With its long term company objectives unchanged, Adam Aircraft will ensure that the required engineering, manufacturing, planning, supply chain, tooling and other development resources are available to achieve TC of the A700 in 2008. Furthermore, the MPF effort will also be staffed and supported to make sure our goals are met to start full rate production of the A500 in the summer and to be ready to jump start A700 production once it is certified.
Adam Aircraft is a designer and manufacturer of advanced aircraft for civil and government markets. The A500 twin-engine piston aircraft has been Type Certified by the FAA, and the A700, which is currently undergoing flight test and development. For more information about the company, visit www.adamaircraft.com.
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