The new Conservative Canadian government has denied a $35 million loan request from Diamond Aircraft, possibly affecting the D-Jet program and the Canadian segment of Diamond Aircraft. The Liberal party had made it clear that, if elected, it would be in support of the request after Diamond laid off 213 of its 380 workers at its London, Ontario, factory on March 28.
Peter Maurer, president of Diamond Aircraft told Flying, “It’s disappointing for sure. The funding would have enabled us to recall our employees immediately, but it’s not our only avenue. It’s just one possible door that got shut.”
Maurer also said the company has already recalled a few of the employees that were furloughed at the end of March. The furloughs only affected employees assigned to the D-Jet program. A small core team of 25 employees is currently continuing its progress. According to Maurer Diamond has invested $160 million into the D-Jet program. An additional $35 million from the Province of Ontario and $20 million from private investors have already been secured, though the investments are contingent on Diamond securing the total $90 million required for the certification and initial deliveries of the D-Jet.
Once the decision was reached, Tony Clement, Canada’s Conservative Minister of Industry, issued a statement declaring that the Canadian government had already provided support for the research and development efforts for Diamond’s D-Jet program and that “Canadian taxpayers entrust the government to make responsible and judicious decisions with their dollars.” The $19.6 million repayable investment was issued in 2008, when Jim Prentice, also a Conservative, was the acting Minister of Industry.
The fate of the Canadian plant remains to be seen. Maurer said the Austrian headquarters remain unaffected by the financial woes of the Canadian side of the business. In a recent statement, prior to the final rejection of government loans Diamond Aircraft owner Christian Dries said: “We have no plans to shut down our operation in London – my family has personally invested several hundred million dollars in the operation.” He continued: “We remain committed to a productive discussion with all levels of government towards a mutually beneficial solution.”
The London plant currently employs 180 people, and with the exception of the 25 employees assigned to the D-Jet, the staff is working on the company’s piston products - the DA20, DA40 and DA42. Maurer said that the company has no intent on backing out of the D-Jet program as the effects of its shutdown could “spill over and affect the propeller program.”