With its announcement this week that it was constructing a factory in Mexico to build its own composite components, ICON Aircraft has made yet another unexpected move. Here’s what it probably means.
The new facility is not, ICON insists in its press release, a move from Vacaville, California, where it has established a factory for assembling the LSA amphibian, the A5. ICON president Kirk Hawkins said in the release that there would be no jobs lost in Vacaville as a result in the change to building composite assemblies in house in the new factory in Tijuana, Mexico. The new facility will eventually employ as many as 1,000 workers. Construction on it starts in November.
With the move, ICON has signaled its intention to get its costs under control by bringing one of the most expensive jobs in house. A number of large aerospace firms, including business aircraft makers, have created manufacturing facilities in Mexico. The move severs the tie between ICON and Cirrus Aircraft, which was one of ICON’s prime contractors, building major composite subassemblies at its factory in Grand Forks, North Dakota.
The move seems to assume some risk for ICON—the construction will be very costly, though ICON declined to share the costs with Plane & Pilot. But it also shows some faith by ICON’s investors in the company’s long-term viability. The company, which at one point had orders for about 2,000 of its A5 amphibians, dramatically cut its workforce in Vacaville and its production plans earlier this year. The plan for the new facilities is a good sign that ICON is again moving forward.
So, too, are the company’s production results for 2016. While at one point before the production pause ICON projected deliveries of hundreds of planes, now it will produce just 20, most of which will be used at one of the company’s training centers.