Rockwell Collins Cuts 80 Positions in Cedar Rapids

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By Aaron Hepker

CEDAR RAPIDS, Iowa - Rockwell Collins plans to eliminate 80 positions in Cedar Rapids, the company’s sixth round of layoffs in less than a year.

The positions were among 140 that the company announced Monday morning it will be eliminating in Cedar Rapids and Richardson, Texas. The cutbacks will take place through Sept. 28, company spokeswoman Pam Tvrdy said.

“It is primarily the cutbacks in defense and the slower than expected recovery in the global economy,” Tvrdy said. “Part of it has been the slower than expected recovery in the business jet market.”

Even though the job reductions were the sixth round announced in the past year, there were no assurances that it will be the last.

“The company continues to evaluate all opportunities to reallocate personnel and resources as appropriate,” said a statement released Monday afternoon. “Each of the company’s business units and shared service organizations are identifying ways to reduce costs so the Rockwell Collins can better withstand the economic and market forces affecting business and to best position the company for long-term growth.”

The cuts and five previous rounds of job reductions do not even take into account the potential of across-the-board federal budget reductions dubbed sequestration that could come about due to Congress’ inability to prioritize spending reductions.

“If sequestration does occur, and depending on what form it takes, we’ll be able to see what additional impact that has on the company,” Tvrdy said.

Most of the previous cutbacks targeted the Government Systems business that pursues defense contracts, but Monday’s layoffs affected mainly the Shared Services and Operations area that supports both the company’s Government Systems and Commercial Systems divisions.

Rockwell Collins locations that were affected included the E-Business unit in downtown Cedar Rapids, where 18 positions will be eliminated.

Affected employees will receive a severance package based on their years of service and outplacement assistance, the company indicated.

Tvrdy said the long-term prospects for Rockwell Collins remain good despite the issues raised by Monday’s announcement.

“In the long-term, we’ve got a very positive outlook in terms of our (Rockwell Collins) content on new Boeing jets, Airbus jets, and a lot of new business jets,” Tvrdy said. “It’s just that we won’t see a lot of economic benefit from them for a year or two.”

Rockwell Collins lowered the top end of its earnings guidance for its present fiscal year in July from $4.60 per share to $4.50 per share.

Among the aerospace industry issues external to Rockwell Collins that have affected the outlook were the bankruptcy reorganization of Wichita, Kansas-based aircraft manufacturer Hawker Beechcraft, which owes Rockwell Collins about $8 million.

Rockwell Collins is one of Iowa’s largest private employers, with about 8,800 employees in Cedar Rapids, and about 20,000 employees worldwide.

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