Wings Magazine

CAE lays off 2,600 employees, designs ventilator

April 6, 2020  By Wings Staff

CAE today announced what it describes as a series of flexible measures to protect its financial position in response to the COVID-19 crisis. The measures include temporarily laying off 2,600 of its 10,500 employees and placing another 900 employees on a reduced work week. It is also temporarily suspending its common share dividend and share repurchase plan.

The Montreal-based company states it is developing what it describes as an easy-to-manufacture ventilator, which will provide life support to patients in intensive care. Designed in 11 days by its healthcare engineers and scientists, CAE is currently sourcing components in order to begin production of this ventilator as soon as it is approved by Health Canada. The company hopes to manufacture thousands of units in its Montreal plant and in other sites over the next few months.

“Our Civil Aviation operations are most affected by the unprecedented disruption of the global air transportation system. At the same time, our Defence & Security operations are less impacted because CAE provides mission critical services worldwide,” said Marc Parent, president and CEO, CAE. “We entered this crisis from a position of strength with a leading market position, a balanced business with recurring revenue streams, and a solid financial position.”

Parent continues to explain that taking “decisive yet flexible action” will help to protect CAE and its employees in the short term, while preparing for long-term growth when global air travel returns. “Our employees have always been at the core of CAE’s success,” he said. “We regret the hardship these temporary measures will cause those affected, especially during these difficult times, and we are grateful to all our employees for their contribution and dedication.”


CAE states, that to mitigate the number of temporary layoffs, it significantly reduced capital expenditures and R&D investments. The company also announced cost-containment measures, including salary freezes and salary reductions for staff not affected by reduced work weeks. This includes a 50 per cent reduction for the CEO and executive team, 30 per cent for vice presidents, 20 per cent for directors and managers, and 10 per cent for group leaders and employees.

CAE points out that while activities related to new pilot training have decreased substantially, many airlines and business jet operators have continued to conduct recurrent training to maintain the certification of their existing pilots. Two-thirds of CAE’s more than 50 civil training centres worldwide continue to be operational, explains the company, but its training utilization is lower than usual as a result of restrictions from border closures and lockdowns. In Defence & Security, more than 90 per cent of CAE’s operational sites are still delivering services to support defence forces.


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