Personnel much more expensive

Cost pressure now also causes FACC to apply the brakes

The order books of aircraft manufacturers are full - and thus also those of FACC, here CEO Robert Machtlinger, who warns, however, of the sharp rise in costs and the associated loss of competitiveness in Austria.

(Bild: Krone KREATIV/REUTERS, Markus Wenzel)

Aircraft supplier FACC is growing thanks to the booming aviation industry. Now, however, the sharp rise in personnel costs is also forcing the Innviertel-based company to hit the brakes. The workforce is still being increased, but not by nearly as much. The existing workforce must become more efficient.

Profitability was increased by 51 percent, the number of employees grew by a further 265 and the order book also grew again - despite a very good half-year result, aircraft supplier FACC is now stepping on the brakes.

"The curve is flattening somewhat"
"We will continue to hire new employees until the end of the year, but the curve will be somewhat flatter," says CEO Robert Machtlinger. After almost 1,200 employees have been brought on board since fall 2021 and the aviation industry continues to boom, the enormous increase in personnel costs, which are mainly due to the high collective bargaining agreements of recent years, are now also having an inhibiting effect on the Innviertel-based company.

We have lost ground in global competition in Austria. That is the problem at the Austrian location, that is the problem that the export industry in Austria is currently facing.

Robert Machtlinger, FACC-Vorstandschef

"We are now back to pre-Covid-19 staffing levels and have around 3,700 employees. Turnover is also close to where it was before. Only personnel costs are now 50 million euros higher," explains Machtlinger.

"Global customers no longer pay us because we manufacture in Austria"
In recent years, we have come under a lot of pressure on the fixed costs and wage costs side," adds CFO Florian Heindl. "And our global customers no longer pay us because we manufacture in Austria," says Machtlinger.

The FACC CEO cites innovation, automation, digitalization and efficiency increases in all areas as the key to remaining competitive. The latter means that screws need to be tightened in production in order to increase build rates without having to increase the number of additional staff: "In contrast to many other industries, however, we have the nice environment of being able to grow."