Maverick Jets says layoffs signal growth

Melbourne plane maker laid off production staff Thursday

Florida Today/May 10, 2003

Melbournce - Maverick Jets Inc.'s manufacturing center on Friday looked deserted. The doors were open and there were airplane parts inside. But no one was there, except for a couple of people closing up the place.

It was a day after the small jet-plane maker, owned by entrepreneur Jim McCotter [formerly leader of Great Commission International], sprang the bad news on its manufacturing and support staff: Thursday was their last day of work.

The company at Melbourne International Airport laid off an undisclosed number of its 60 employees, saying it was "outsourcing" its manufacturing operation to another location, which it has not yet disclosed.

On Friday, a company spokesman, Sandy Scott, Maverick's director of client development, reiterated the layoffs don't mean the company is in trouble. Rather, it signals the next stage of Maverick's development.

Scott said the company believes its five-seat, lightweight "personal jets" are so unique, fuel-efficient and affordable that everyone from flight enthusiasts to businesses will want its $1.25 million "Leader" model.

The jets have a maximum speed of about 474 mph and a flight range of about 1,735 miles.

The planes are classified as experimental aircraft, which means they can't be used for commercial flights. It also means the buyers of the jets or their representatives must be involved in at least part of the plane's construction.

What makes the Leader jets so light - about 2,900 pounds empty - is that they're mostly made of a lightweight composite material, rather than steel.

Scott said the lightweight material proved to be strong in the crash of one of its jets on Jan. 24.

Jack Reed, Maverick's chief pilot, was taking a Maverick plane on a test flight when the aircraft went down in woods near Melbourne's airport. Reed was killed, but the plane held up well, Scott said.

"The crash seemed to have no negative effect on the company," Scott said. "There were no lawsuits filed."

"Interestingly, the crash actually had a positive effect on sales when it was learned that the strength of the composite materials used to construct the aircraft caused the cockpit to stay totally intact. Even the seats remained in place."

The National Safety Transportation Board said Friday it is still investigating the crash and has not made a final determination of its cause.

"It was widely understood in the aviation community that the cause of the crash was due to a medical situation," Scott said.

"The thinking was that he had some kind of medical event (while in flight), and he was trying to get the plane on the ground as soon as possible."

A spokesman for the National Safety Transportation Board would not comment on the company's assertion that the pilot had a medical problem that led to the crash.

So far, Maverick has sale orders for 20 of its jets, and the company expects to ramp up its operations and sell hundreds more in coming years, Scott said.

To accomplish that, Maverick needs a manufacturing center larger than the 35,000-square-foot building on NASA Boulevard near Melbourne's airport that it had been leasing from the Melbourne Airport Authority. The building previously had been a Scotty's hardware store.

Scott said Maverick is about to sign an agreement with a larger aviation company to handle its manufacturing work, making use of a 2.7 million-square-foot facility. He also said the move will cut costs.

The manufacturing center in Melbourne was used to assemble parts of the aircraft, but the actual building of the planes takes place at another Maverick location in Texas.

But if Maverick increases production, as it plans, it will need to open a second "build center," and the company is "seriously considering" doing that in Melbourne, Scott said.

Maverick also will keep its headquarters offices at an aviation complex on the north side of Melbourne's airport, where Maverick subleases property from another aviation firm.

McCotter moved the company to Melbourne last year from Colorado, and increased the size of the company's workforce.

Melbourne International Airport Executive Director Jim Johnson said the airport had given Maverick no special incentives to move to Melbourne last year.

Johnson said his staff had spoke to Maverick officials to try to get the company's manufacturing operation to stay in Melbourne. But the company found a much-less-expensive arrangement elsewhere, he said.

McCotter wasn't available for comment Friday.

Scott said his boss has owned about 100 companies, particularly television and radio stations, newspapers and magazines. But McCotter has divested himself from most other business interests to focus on Maverick, and he has moved his wife and children from Colorado to the Melbourne area, Scott said.

McCotter's employees were shocked Thursday when managers gathered them at Maverick's manufacturing center and told them they were being laid off immediately, without warning. Among those laid off were fabricators, support staff and engineers.

The federal Worker Adjustment and Retraining Notification Act requires employers to provide 60 days' advance notice of plant closings and mass layoffs. In general, the law applies to companies with 100 or more employees.

Because Maverick had a staff of only 60, as Scott said, it appears the company is exempt from the requirement of providing notice of the job cuts.

As of Friday, a few of the laid-off Maverick employees already had applied for jobs at Liberty Aerospace, another producer of small airplanes at Melbourne's airport.

Mike Fabianac, Liberty's sales and marketing manager, said Liberty "quite possibly" would hire the former Maverick workers. Liberty has a staff of 35 at the local airport, and plans to hire 30 more people in the future.

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