There were no new products to announce, but Cirrus Aircraft’s press conference yesterday drew a standing room only crowd—there were no chairs—to the company’s booth (183, 204, Main Aircraft Display). The crowd came eager to learn what lies ahead following Cirrus’ February purchase by the China Aviation Industry General Aviation (CAIGA).
Based in Duluth, Minnesota, Cirrus manufactures the all-composite SR20 and SR22 single-engine airplanes, noted for their modern construction methods and the Cirrus Airframe Parachute System ballistic recovery system in all their aircraft.
Cirrus President and CEO Brent Wouters said the sale was good for Cirrus for three reasons: financial stability for the company in the near- and long-term; access to capital for product development; and fostering greater international growth.
As for its product development plans, “Everybody knows about the jet,” Wouters said, referring to the company’s stalled SF50 single-engine jet program.
“But everybody doesn’t know the rest of our strategy. We need a lot more products. We need bigger airplanes, we need smaller airplanes. We’ve got to get a much broader product line and (do it) very quickly.
“So (our strategy) can’t be about one development program. It’s a very aggressive approach to increase our product line. Our sense of urgency is high. Now that we have the capital to do it, we’ve got to go very quickly.”
However, Wouters said no discussion of capital needs and availability has been held with CAIGA thus far, because the focus of the two companies’ discussions has been on completing the sale and transition issues.
Press conference questions focused on concerns that CAIGA bought Cirrus only to move the manufacturing to China, or to gain access to the company’s technology—without regard for the company’s future.
Wouters said that while there were no guarantees that couldn’t or wouldn’t happen, those scenarios were unlikely.
“They already have composite carbon technologies far superior to what we do. They don’t need us for our technology,” Wouters said, noting that the U.S. government’s approval of the sale underscored that contention.
Furthermore, he said, CAIGA is interested in expanding aviation in China and globally, not in gaining manufacturing jobs.
“That’s an ’80s and ’90s thing,” Wouters said. “Today [the goal] is to develop the skills-oriented jobs.”
In addressing concerns about foreign ownership, Wouters noted that the company’s current owner, Arcapita, is the investment arm of the First Islamic Investment Bank of Bahrain, and that it purchased Cirrus three weeks before the 9/11 attacks of 2001.
With the drop in sales to the retail market since the economic downturn in 2008, Cirrus has upped its focus on fleet and institutional sales.
As a sign of the success of those efforts the company also touted its recent sale of 25 SR20s reconfigured as trainers to the U.S. Air Force Academy.
Asked about the past-due bills that have dogged the company during the downturn, Wouters said overdue accounts payables have been reduced “by tens of millions of dollars.”
As for the SJ50 Vision jet program, Wouters reported that 90 depositors had canceled their orders and that all deposits had been returned, while an equal number of new orders and deposits have been received.