Icon Cuts Workforce 40 percent

Icon Aircraft said Friday it is implementing a revised business plan for the unique LSA seaplane that includes a 40 percent cut to the company's current workforce. Icon president and COO Thomas Wieners said, "Icon is currently structured for higher volume production, but after producing more than 100 aircraft, we now have a very good understanding of costs. And while the Icon A5 is truly an exceptional plane, the necessary higher price lowers demand considerably and requires us to adjust the organization's size as a result." Icon's original business plan envisioned 10 A5s rolling out the factory door each month. The company would not disclose the actual number of A5s being produced at the moment but said Icon plans to match production to demand. The company said it sold five aircraft last week.

The airplane's higher production costs and reduced rate have eaten into Icon's bank account despite having received a new round of financing from Chinese investors. Icon told Flying the company was expecting a second round that did not appear despite those investors claiming to be bullish on the company at the beginning of 2019. The company believes it has become more challenging for the Chinese to invest in U.S. companies.

Wieners thinks a number of factors have impacted the A5 order book. “Price is certainly a contributing factor, and that’s driven by the cost of manufacturing. We are course-correcting with this restructure to be more in line with realistic expectations.” He also confirmed the A5 still sells for the same $389,000 it has for the past year and a half. Wieners added, “Creating a new category is challenging and takes time. We’re proud of what we’ve accomplished across the board, including our state-of-the-art manufacturing facilities. The A5 is an incredible airplane. Our intention was never to create a cheap aircraft. Customers love the A5 and the fact that it provides an unparalleled flying experience for those seeking adventure from a unique perspective.”

There have also been a number of recent A5 accidents and incidents, two of which involved fatalities. In three incidents, pilot attempted to land their A5 on the water with the landing gear extended while five other incidents point to landing on a hard-surface runway with the wheels up. In the most recent accident, the pilot crashed into trees along the shoreline during takeoff near Mt. Pleasant, Michigan. None of the incidents have pointed to the Icon design itself.

“We’ve certainly seen what’s happening [on that front] and don’t like it,” Wieners said. “We focus heavily on promoting safe flying through our training program, as well as continuing education with owners. In fact on July 4, I sent a note to owners stressing the importance of gear position checks. The aircraft is safe. You know and have experienced firsthand the technology we put in the design.” He stressed that oftentimes these accidents are occurring with high time or experienced pilots in command. “We will continue to stress the importance of safety and safe decision-making.”