Any Canadian who was around in the 50’s will surely see many parallels between the situation now with Diamond Aircraft Manufacturing in London Ontario Canada, and the similar situation with the infamous “Arrow” fighter aircraft back in 1959.
Diamond is an aircraft manufacturer who has run into financial difficultly, due largely to the fact that they had to develop their own engine after the original design aircraft engine manufacturer went into bankruptcy.
Do you recall, AV Roe (the manufacturer of the Arrow) was forced to develop their own engine for the Arrow in the 50’s, and the resulting financial difficulties they had developing the Orenda Engine? When the Conservative Government defeated the ruling Liberal Government, they immediately pulled the plug on A.V.Roe on February 20th 1959 with the loss of 50,000 Canadian jobs.
The Liberals in the mid 50’s supported the development of the Arrow and again the Liberals were the primary supporters of the Diamond D-Jet today. In 1959 shortly after the Conservatives gained a majority government they cancelled the Arrow. Now in 2011 will history repeat itself??
One problem was that the Canadian government became their plan B after a private financing fell through. They became desperate as they realized that government funding almost never arrives on time.
Another problem was that here in Canada, Bombardier and Bell helicopters (both based in Quebec) have more political weight since they are bigger, have more employees and are more prestigious than tiny Diamond. So, as far as the government is concerned, they only needed to keep those other companies happy to get re-elected. Looks like they were right.
Eventually, Diamond will get the loan (or at least part of it), but next time, they need to give themselves more margins and use government funding more sparingly. 35 millions is a lot in Canada.