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Hawker 400XP Production Suspended

Manufacturer Claims Suspension is Temporary

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Hawker 400XP Production Suspended

The Hawker 400XP and its predecessors have been in continuous production since the early 1980s.

Hawker Beechcraft

Struggling Hawker Beechcraft announced that it will suspend production and sales of the Hawker 400XP light jet for two years.

Hawker Beech Chairman and CEO Bill Boisture made the announcement on a conference call with analysts and in SEC filings. Production should resume in early 2013.

Boisture said the weak economy - which has taken an especially heavy toll on the OEM - will continue to impact sales for the next 12 to 24 months.

The timing of the announcement came as something of a surprise to many industry observers.

Rumors were rampant at the recently concluded NBAA annual convention in Atlanta of a possible production reduction or shutdown, yet no announcement materialized. And Boisture spoke early last week at a gathering of business aviation industry leaders in suburban Washington and did not hint at any major production changes.

Hawker Beechcraft is suffering due to the limitations of its product line, which includes the venerable Baron and Bonanza piston aircraft, the successful King Air series, the Hawker 400XP, Premier 1, the traditional Hawker Jet series and the Hawker 4000.

Most of the aircraft are considered mature, with only avionics and performance upgrades distinguishing newly produced aircraft from their originals. The Hawker 400XP, for example, began life as the Mitsubishi Diamond Jet in the early 1980's.

Other business jet manufacturers such as Cessna and Embraer have introduced several popular new designs as Hawker Beechcraft pinned its hopes on just two new aircaft.

Hawker Beech is hoping popularity of the Hawker 4000 super-midsize jet will catch on. Originally introduced as the Hawker Horizon, the 4000 offers impressive performance, although its long-delayed certification cost the manufacturer numermous customers, including a large order from NetJets.

Boisture has said the company suffers from not having a long-range or ultra-long-range aircraft which continue to sell briskly despite the economic crisis.

In addition to the Hawker 400XP program suspension, Hawker Beechcraft is reducing costs through layoffs, and through partnerships with companies offering upgrades for the company's aircraft.

Hawker Beechcraft is also increasing its presence in overseas markets such as Asia and the Middle East which account for an increasing portion of its business.

The company is engaged in a contentious labor negotiation with the IAM and is considering a move from its Wichita roots to less expensive Louisiana which is offering incentives for the company to relocate.

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