Sunday, June 24, 2018
Business

PEMCO warns it will lay off nearly 500 at Tampa International Airport

TAMPA — The bay area is about to get hit with one of the single-largest layoffs in the state this year: PEMCO World Air Services is planning to fire 474 workers at its aircraft maintenance complex at Tampa International Airport.

PEMCO is the largest airplane maintenance and repair company headquartered at Tampa International. But the company said it has no choice but to start gutting its local workforce within a matter of days after losing a major contract with United Airlines, according to a letter PEMCO sent to local and state officials on Thursday.

"We're saddened by this turn of events," said Tampa International CEO Joe Lopano in a prepared statement. "No one likes to see layoffs."

PEMCO blamed United's "recent sudden cancellation" of all its maintenance work for the "sizable workforce reduction" at its facilities at 4102 and 4202 N West Shore Blvd.

"While PEMCO would have preferred giving more notice, this loss of a key customer's business was not foreseen by the company, which has had a long relationship with UAL," company director of human resources Colleen Picard wrote. "Although PEMCO's Tampa facilities will continue operations, these layoff(s) are expected to be permanent."

The news comes just five months after PEMCO filed for Chapter 11 bankruptcy reorganization, blaming a tough economy and a decline in the number of airline maintenance, repair and overhaul orders.

At the time, the company promised to continue to operate in the normal course of business without interruption. PEMCO officials could not be reached for comment.

However, based on recent employee head counts, the cuts represent the bulk of the company's operation.

Thursday's announced cuts rank among the largest mass layoffs in Florida this year, second only to a largely seasonal layoff of 608 workers in June by a partnership controlled by strawberry grower Gary Wishnatzki.

United confirmed that it severed its relationship with PEMCO but did not say where it was relocating what it called "heavy maintenance" work.

"As part of ongoing reviews of our maintenance vendor relationships, we recently determined it was more efficient to shift this business elsewhere," said United spokesman Rahsaan Johnson in an email.

PEMCO operates out of two cavernous hangars for airlines such as United and JetBlue. Planes requiring complicated and lengthy repairs were sent to PEMCO's facility, while routine maintenance is often performed by the airline's own, much smaller crew of mechanics.

Southwest Airlines, for example, keeps about 40 of its own mechanics at the airport to perform minor repairs and overnight work on its planes. Johnson said that the end of the PEMCO contract will not affect routine maintenance of United's planes at Tampa International.

When PEMCO arrived on the scene in 2008, it was viewed as a major coup. The company leased the old US Airways hangar that had been vacant for six years, ever since US Air had filed for bankruptcy and cut 300 workers at the repair site.

In 2010, PEMCO expanded into the airport's other big jet-repair facility, the former Delta Air Lines hangar. Delta had abandoned the facility in 2005 and eliminated 300 jobs there as part of a $240 million cost-cutting plan.

Then last year PEMCO moved its headquarters to Tampa from Dothan, Ala., with pledges of continued growth.

"We intend for our Tampa facility to be the company's flagship," then-CEO Wake Smith said at the time, "and we see Tampa as a better market to attract the sort of executive talent we need to lead the company."

According to Tampa International, PEMCO owes the airport about $188,000 in rent for the hanger space. About $126,000 of that was owed before March's bankruptcy filing. Since then, the airport said, PEMCO had paid its monthly $77,608 rent in May, June and July. However, as of Thursday, the company had yet to pay August's rent, which is now due.

But PEMCO owes money to more than just Tampa International. When the company filed for bankruptcy, according to court records, it owed creditors $12 million, including the airport and Impact Industrial Supplies, a supplier of airplane parts and equipment in Tampa.

According to the layoff notice filed Thursday, the job cuts would take place between today and Aug. 15. PEMCO noted that 328 of those are employees who work for the company and 146 are contract workers. The company's workforce is not unionized.

Those set to lose their jobs include: 172 aircraft mechanics, 100 sheet metal mechanics, 49 avionics technicians and 34 quality inspectors.

"Employees will be laid off as work is completed on each United aircraft currently on-site," according to the company's letter.

Times researcher John Martin contributed to this report. Jeff Harrington can be reached at [email protected] or (727) 893-8242. Jamal Thalji can be reached at [email protected] or (813) 226-3404.

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