CAE to slash 700 jobs, mainly in Montreal
By John McCrank
TORONTO (Reuters) - Flight simulator maker and training company CAE Inc said on Thursday it plans to lay off 700 employees, or 10 percent of its workforce, mainly to offset softness in the aerospace market.
The Montreal-based company said the job cuts would come in two phases, with 380 layoffs over the coming weeks, and the remainder in the fall.
CAE said it expects just 20 orders for flight simulators in the current fiscal year, down from 34 last year.
At the same time, the company said its quarterly operating earnings rose 9 percent from a year earlier, helped by a strong backlog and an increase in military orders.
"The measures we're taking are to make sure that we can maintain our leadership in the market," Robert Brown, CAE's president and chief executive, said during a call with analysts and reporters.
About 600 of the layoffs will be in Montreal, where CAE builds the simulators. The rest will be in various locations in the 20 countries in which CAE operates.
The company said a majority of the jobs being lost relate to the manufacturing of simulators, with some engineering jobs also being cut and 70 management positions eliminated.
"By these measures, 90 percent of the employees are ensuring their position," Brown said. We're "also in a period where people have to go out and renew lines of credit from banks, so we've got to continue to show good performance to make sure that we can attract the investors and make sure the banks are going to continue to fund us." Continued...