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Sino Swearingen, Alliance look to stay aloft

March 28, 2001

Sino Swearingen, Alliance look to stay aloft



Martinsburg, W.Va.

By DAVE McMILLION / Staff Writer, Charles Town


Two aviation experts predicted Tuesday that two companies that want to manufacture airplanes in Berkeley County may have trouble competing because their competitors are ahead of them in designing new planes.

Alliance Aircraft Corp. says it plans to build a "regional jet" with seating for 30-50 people.

Sino Swearingen, which has built an 87,500-square-foot factory at the Eastern West Virginia Regional Airport, where it wants to build its seven-seat, SJ30-2 business jet.

In both the regional and business jet market, other plane manufacturers have either produced more airplanes or are ahead of Sino Swearingen and Alliance in the development of new jets.

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"It's difficult to see how either one of them will attract a significant market share in light of the fact that their competition is well established," said Gerald Bernstein, managing director for the Stanford Transportation Group in San Francisco, an airline consulting firm.

Doug Abbey, a regional jet specialist for the Avstat Assocation in Washington, said he is not an expert in the business jet market. But he said Alliance is facing "very much an uphill battle." He said Alliance has been further hurt by its financial struggles.

U.S. Sen. Jay Rockefeller, D-W.Va., who has been involved with bringing Sino Swearingen to Berkeley County, described the jet maker's situation as "worrisome."

Rockefeller, while in Berkeley County Monday, said he did not know as much about Alliance because he was concentrating on Sino Swearingen.

"I'm trying my best to keep Sino Swearingen afloat and that's a task," Rockefeller said.

Alliance Aircraft has a history of financial struggles and legal fights. Last week, Sino Swearingen announced it would lay off about 100 employees at its San Antonio, Texas, plant.

The layoffs do not affect Sino Swearingen's 11 employees at the local airport, where tails for the SJ30-2 are being constructed.

Sino Swearingen was forced to make the layoffs because it needs another $100 million for the design of its jet, said company spokesman Mike Potts.

The company's plan to hire 300 employees in Martinsburg have been put on hold, he said.

Potts declined to say from whom the company would seek money. In 1995, it formed an agreement with a group of Taiwanese investors to develop the SJ30-2.

Both Potts and Alliance spokesman Jim Martin disagreed with the two industry analysts who said the plane companies face tough times ahead.

Potts said Sino Swearingen has marketed its SJ30-2 as a business jet that goes "farther, faster and higher" than others in its class. And it will cost less, Sino Swearingen officials say.

FAA certfication for the Sino Swearingen plane could take a year to obtain.

Martin said Alliance Aircraft has conducted extensive market research for its Starliner 100 plane and found there is room in the regional jet market for competition. A regional jet is a smaller plane that offers "point-to-point" air travel.

Martin discounted Bernstein's comments.

Alliance has grappled with debt, faced lawsuits and struggled to get financing for its plant.

In an interview this week, Martin said he didn't want to dwell on the past and would rather "take the high road."

He said Alliance was looking for a state that would offer political support, incentives and a good quality of life after efforts to build a facility in New Hampshire fell through.

He said West Virginia "bent over backwards to make us feel welcome."

Martin said Alliance has not asked for money from the state to help build a plant. It is looking for start-up money from private sources, he said.

The only incentive that has been offered to Alliance is the typical incentive offered to many companies that move to West Virginia, said Bob Crawford, executive director of the Berkeley County Development Authority.

That includes up to an 80 percent break on the company's corporate net income tax and business franchise tax, Crawford said. The package also includes employee work force training, Crawford said.

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