Canadian Government Denies Diamond Dollars

Pia Bergqvist

Wednesday, May 18, 2011 at 08:53 PM ET

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Photo Courtesy of Diamond Aircraft Courtesy of Diamond Aircraft

Key Takeaways:

The Canadian Conservative government denied Diamond Aircraft's $35 million loan request, which aimed to support the D-Jet program and recall laid-off workers at its London, Ontario, factory.
The government justified its decision by citing prior support provided in 2008 and the need for responsible use of taxpayer money.
Diamond Aircraft's president expressed disappointment but affirmed commitment to the D-Jet program, noting other secured investments are contingent on obtaining the full $90 million needed for certification.
Despite the funding setback, Diamond's owner has committed to not shutting down the London plant, where 180 employees continue working primarily on piston products.

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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.”