MONTREAL — Pratt and Whitney Canada is blaming the global slowdown in the aerospace market for its decision to slash 410 jobs from its worldwide workforce and close a Montreal-area plant by the end of next year.
The company said Wednesday it will cut 250 jobs by the end of this year and an additional 160 jobs by the end of 2010, when it closes its Auvergne Street plant in Longueuil, Que., a community just south of Montreal.
The aircraft engine maker said it will consolidate its activities from the Auvergne Street plant at its other facilities in Quebec — its headquarters and a service centre, both in Longueuil — and a facility being expanded in Mirabel, north of Montreal.
The cuts come as the Patt and Whitney copes with a slump in the global market for corporate jets, regional aircraft and other planes, caused by the worldwide recession.
“These are difficult times. We need to make strategic decisions and structural changes to remain competitive and preserve our future in the face of continuing economic headwinds,” said John Saabas, president of the company, which is a unit of U.S. industrial giant United Technologies Corp. (NYSE:UTX).
“We are sensitive to the personal impact on employees who will be affected, and we will do everything we can to ease their transition,” Saabas said.
Nancy German, a Pratt and Whitney spokeswoman, said all options are being considered, including early retirement and work sharing, to reduce the impact on employees.
But she said that the cuts are unavoidable.
“The impact of the economy is sustained,” she said. “We don’t foresee any signs of recovery for us in 2010.”
German also pointed out that the 160 job losses resulting from the shutdown of the Auvergne Street plant would not necessarily be felt by only the employees at that plant. Germain said the job reductions would be spread across all three of the current Longueuil facilities through such things as early retirement or bumping allowed under the workers’ contract.
“We will certainly make sure that we give all support to our employees during this transition period — outplacement services, severance packages. We’re very sensitive to the impact these decisions have on our employees,” German said.
Pratt and Whitney will make and test engines for Bombardier’s new CSeries regional jets at its Mirabel aerospace centre.
Bombardier Inc. (TSX:BBD.B), which hopes the CSeries will gain a strong share of the aircraft market, is in the process of laying off 4,360 employees as it reduces production of business and commercial aircraft. Regional jets, which are sold to airlines, are estimated to account for 1,200 of the layoffs.
German said the construction of the Mirabel facility is continuing on schedule and that the flight test operations section should be finished by May 2010 and the assembly and engine test section should be completed by the end of that year. Germain said when engine production starts in earnest, “hundreds” of people will be employed at the plant.
When Pratt and Whitney completes the Mirabel facility in 2010, it will have 1.1 million square feet of manufacturing space in Quebec, approximately 10 per cent more than today.
“We’re definitely committed to our facilities in Quebec,” German said. “Unfortunately we have to make this very difficult decision considering the current economic context.”
Saabas echoed that in his statement, saying that despite the latest cuts, Pratt and Whitney plans to expand its capacity in Quebec.
“We remain committed to our activities in Quebec and Canada,” said Saabas.
But Camille Larochelle, head of the Canadian Auto Workers affiliate at Pratt and Whitney, said Wednesday’s news was “very hard” for workers to hear even in the current tough economic times.
“It’s true the market is at the bottom,” he said. “I don’t deny that, it’s true. But to use that reason to close a plant is unacceptable to us.”
Larochelle said while the union would work with the company to minimize the impact of the cuts, it would also be vigilant to ensure that large numbers of part-time workers are not used to replace full-time jobs.