- July 27, 2009, 11:46 AM

Faced with a dwindling order tally, France’s Dassault Aviation is making changes to its work schedule to cut costs while limiting the effect on salaries. In late June the company signed an agreement with three out of four unions for a part-time working arrangement planned to take effect from September to February next year. Under the agreement factories involved in Falcon production–those located in Argenteuil, Biarritz, Martignas and Seclin, France–will close between five and eight days per month during the six-month period. The agreement affects 3,000 employees.

Raymond Ducrest, central representative for the CFDT union, told AIN that the move should translate into a net reduction in salary of 3 to 5 percent for non-executive employees, thanks in part to national unemployment insurance. For them, the company pays 50 percent of the salary, while the rest comes from the insurance and other public organizations. For executives, the company contributes 75 percent. Under a national agreement in the so-called metal industry branch, there is no reduction in the total earnings of executives. A spokesman told AIN that the company is postponing raises for senior executives and has “made efforts to keep a certain level of profit sharing with the employees.”

The cost-cutting action affects only Dassault Aviation, which has a total of 8,300 employees. Subsidiaries Dassault Falcon Jet (in the U.S.) and Dassault Falcon Service (at Paris Le Bourget airport) are not involved, a company spokesman said.
One feature of the agreement is that those workers who are not affected by
the shortened month contribute a day of vacation to a pool to ensure that affected workers, now working less than full time, keep the social benefits they would otherwise lose.

According to Ducrest, Dassault is now targeting a monthly production rate of nearly five Falcons.

That number is consistent with the company’s official goal of delivering about 80 Falcons this year, as about 20 of them had been manufactured late last year. One year ago, Dassault was working on ramping up production to more than 10 aircraft per month. It ramped down production early this year.

During the first quarter, the net Falcon order tally was minus 27. In late May there were more than 30 Falcon 7Xs at various stages of final assembly at Dassault’s Bordeaux Mérignac factory as a result of last-minute cancellations. “This bottleneck situation will be back to normal by year-end,” CEO Charles Edelstenne pledged in June.

Dassault has laid off fewer people than other business aircraft manufacturers. AIN estimates that some 230 jobs have been cut, including both completion
and support activities in the U.S. According to Edelstenne, that number includes 40 retirements.