The head of aircraft sustainment firm AAR Corporation is urging the US Congress and the Trump administration to include companies like his in the multi-billion dollar aid package that they are considering to help the beleaguered airline industry.
AAR’s headquarters in Wood Dale, Illinois. (AAR)
John Holmes, AAR’s president and CEO, said on 24 March that he has talked with government officials in recent days about how grants or loans would help companies like AAR that, like airlines, are hurting from the air travel decline caused by the coronavirus disease (Covid-19).
“A bailout or aid package needs to address more than just the airlines,” Holmes told analysts on a conference call. “It needs to address the broader aviation services industry because companies like ours, particularly around heavy maintenance, are a vital link in keeping the aircraft in the United States flying.”
AAR is already taking its own steps in response to Covid-19, including reducing its workforce and cutting executive pay and non-essential spending.
AAR’s current difficulties follow a positive performance in fiscal year 2020’s third quarter, which ended on 29 February. AAR’s consolidated sales totalled USD553.1 million in the quarter, up 4% from the same period in FY 2019. Net income was USD2.3 million compared with a USD37.4 million loss a year ago.
Defence and other government customers accounted for 35% of AAR’s sales, up from 33%. Recent contract wins include a USD90 million award from the US Defense Logistics Agency to produce shipping/storage containers and accessories in Cadillac, Michigan.
In the coming months, AAR intends to consolidate facilities in its Expeditionary Services business segment to increase efficiencies and cut costs.
AAR, which is headquartered in Wood Dale, Illinois, near Chicago, has more than 6,000 employees in more than 20 countries.
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