By Patrick Preston
Investigative, Political Reporter
Published: September 11, 2009
COLUMBUS, Ohio—A NetJets spokesperson told NBC 4 on Friday that between 200 and 250 Central Ohio employees were in the process of being notified that Friday was their last day.
NetJets spokesperson Ted Lowen said more than 200 Central Ohio employees were being notified Friday that their positions are being eliminated. Lowen would not give an exact number but said the total is less than 250 employees.
That amounts to more than 10 percent of the roughly 2,000 NetJets employees working in Columbus and Gahanna.
NetJets Inc. said it took the cost-reduction action as a result of the severe economic conditions facing the aviation industry.
Lowen described the internal workforce reductions as across-the-board, with a greater number of administrative and marketing positions affected.
The reductions extend to the entire company, impacting 5 percent of the more than 7,000 NetJets employees worldwide.
While local municipalities have worked to offer tax incentives to help NetJets expand, Lowen said, “we’ve not taken any money that we don’t deserve,“ adding that the company will not need to return any funds after today’s layoffs.
Lowen said NetJets is “responding to the severe economic conditions impacting customers” who have reacted themselves by “not asking for NetJets services as much.”
The company had analyzed the decision for weeks after already working to reduce costs this year by putting off jet purchases and cancelling the delivery of other jets.
As for the timing of the announcement, Lowen said Sept. 11 is ”not the ideal day,” but the company felt it was better to announce the decision to eliminate jobs sooner rather than later.
NetJets is offering severance packages and outplacement services to affected employees.
NetJets has delayed jet purchases and cancelled some delivery orders as the company lost $349 million in the first half of the year.
Last month, NetJets announced it would move its headquarters from New Jersey to Columbus, as part of a $200 million expansion project at Port Columbus International Airport. The company said those expansion plans are now on hold.
In March 2008, leaders from the city of Columbus and state of Ohio celebrated NetJets decision to stay in Columbus. The two governments combined to offer nearly $100 million in tax breaks and job incentives, including $67.6 million for workforce-development tax breaks and job credits. Another $30 million in incentives were offered for area site improvements, loans and marketing.
NBC 4 checked Friday if those dollars would need to be paid back. It turns out they were never paid out.
“To this point no public dollars have gone out to the company,“ said Steve Schoeny, director of the Strategic Business Investment Division of the Ohio Department of Development. “Most of the dollars that we put in are sort of done on a reimbursement basis. So, since they really haven’t started construction. Those dollars that would have gone in haven’t been paid out yet.“
Schoeny said both the city and state remain optimistic that NetJets can grow in Central Ohio.
“We believe the company is very committed to Central Ohio. They announced last month they’re going to be moving the headquarters from New Jersey to Ohio. We believe this is just a short-term blip for them,“ Schoeny said.
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