By DAN HEATH
Staff Writer
May 10, 2008 08:06 am
—
PLATTSBURGH -- Laurentian Aerospace Corp. officials remain upbeat the project will move forward this summer.
Laurentian President and Chief Executive Officer Robin Wohnsigl and Chief Financial Officer Andrew Edwards provided an update on progress toward the $180-million maintenance, repair and overhaul facility to be built at Plattsburgh International Airport.
What's your opinion?
"We're cautiously optimistic," Wohnsigl said.
The plan calls for an approximately 273,000-square-foot, two-bay hangar, more than twice the size of the Target store under construction at Champlain Centre. Each bay would be able to service all wide-bodied aircraft with the exception of the Airbus A-380 and the in-development Boeing 747-800.
The company hopes to close on its financing by June 30, but that will require a heroic effort, Edwards said.
"If we don't make it, we won't be far behind," he said.
Once the deal is closed, Wohnsigl will move to Plattsburgh and manage the plant and Edwards will remain chief financial officer.
Wohnsigl said construction is expected to take 18 months.
Between 200 and 300 people are expected to be employed initially, with up to 900 at full production, expected to take 12 to 18 months. Wohnsigl said that if things go well, they could build a second and third facility.
Edwards said there are five key points that have come together to make it work in Plattsburgh. They include a proven management team, advanced technology, a location with enough space to build a hangar around the docking system, strong community support and the availability of long-term, fixed-rate bonds.
"These five components came together like a perfect storm," Wohnsigl said.
Edwards said the funding includes $125 million in tax-exempt bonds to be issued through the County of Clinton Industrial Development Agency. The other $55 million will be equity funding from investors.
"We have strong indicators for slightly more than half of the equity funding," he said.
That leaves between $20 million and $30 million to be obtained, depending on the ratio of funds from lead and secondary investors.
"We have five very interested equity companies," Wohnsigl said.
Having Wohnsigl on board has helped create a lot of that interest, Edwards said.
"His name recognition in the industry is really, really helpful," he said. "He knows everybody in the industry on a first-name basis."
One key in discussions with investors is that about one-third of heavy maintenance of wide-body aircraft is done offshore, mainly in Asia, because there is a shortage of North American hangar space.
Edwards said most companies won't build additional space because it is too tough to compete with Asian labor costs. That is where the computer-operated, laser-guided docking system that will be used makes the difference.
The system, designed and built by Multidocking Contec Ltd., allows work to begin on aircraft within 30 minutes of arrival in a hangar. That saves about a day on each end of the maintenance, which saves an airline about $200,000 a day.
Computer stations at all levels of the structure keep workers in place, rather than scrambling up and down the huge aircraft, which cuts another two days on each maintenance operation.
Laurentian has a number of airlines that have said they would use the facility, including Air Canada, American, Delta, Northwest, United, Federal Express and UPS. Edwards said once airlines schedule the shorter turnaround into their schedules, they will be locked into Laurentian.
"No competitor will be able to duplicate what we offer," he said.
Edwards said the company was very close to reaching a financing agreement last fall, but the lender pulled away as it was affected by the subprime mortgage crisis. At a meeting of the County of Clinton Industrial Development Agency, that lender was revealed to be entities associated with Deutsche Bank.
Plattsburgh-North Country Chamber of Commerce President Garry Douglas said investors seem most worried about meeting workforce needs.
Douglas said the chamber and John Masella of OneWorkSource and the New York State Department of Labor have a really good plan. It includes graduates of Plattsburgh Aeronautical Institute and recruitment of additional mechanics and technicians.
Edwards said the last time he checked, OneWorkSource had about 225 applications, with at least 60 percent already in possession of an FAA Airframe and Powerplant license or college degrees and training in a related field. Douglas said it has to be understood that huge deals take a huge amount of time.
"The timeline to date is nothing unusual. If these guys can't make this venture happen, nobody can," he said.
For additional information, visit www.laurentianaerospace.com.
dheath@pressrepublican.com
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