Local aircraft company perseveres after 9-11 attacks

Worldwide Aircraft Services, a maintenance repair overhaul facility located at the Springfield-Branson Regional Airport, has not delivered an airplane to a U.S. customer since September 2001. Normally, about half of the company's business involves delivering planes to customers in the Untied States.

Worldwide Aircraft specializes in regional commercial turbo props and the exportation and importation of those aircraft. Jim McLean, president and chief executive officer, said the company's business dropped nearly 60 percent following the Sept. 11 terrorist attacks.

As a small business in the aviation industry, Worldwide Aircraft met specific criteria needed to qualify for an expanded Economic Injury Disaster Loan from the Small Business Administration.

According to the SBA Web site, the purpose of the disaster loan program is to provide a small business the funds needed to meet ordinary and necessary operating expenses. Disaster loan funds are granted to cover expenses that the business normally could have met prior to the Sept. 11 attacks.

Worldwide Aircraft has been approved for such a loan, but McLean said he has not yet acted on it. Rather, the company is working through the downturn in business by being frugal and watching costs, he said.

"We were fortunate in that we had always prepared for the rainy day," McLean said.

During more than 16 years in business a rainy day never befell the company until last September. Since then, McLean said, it has cut back on nonproductive areas of the business and sold surplus assets instead of taking advantage of disaster loan funds. "We had our own resources to fall back on," he said.

McLean said the company applied for the loan because of the low interest rate and the long-term payment plan. He noted that the program's strict criteria limits how the funds can be used.

The SBA Web site states that disaster loan funds are intended to provide only the amount of working capital needed by a business to pay its necessary operating expenses until operations return to normal.

McLean said so far he has preferred to continue operations without the assistance of the loan, but he added, "We're not out of the woods yet. The market hasn't really come back to pre-9-11 levels. It's still a very tough market for us."

The market is saturated with airplanes, and the current demand for planes is low, McLean said.

The company's European and South American markets continue to hold steady, he added.

McLean said he knew Worldwide Aircraft was in trouble when UPS, Federal Express and other major shipping companies began losing large percentages of their business at the end of last year.

The subsequent diminished need for aircraft led to an impact on Worldwide Aircraft, he said.

"That's when we knew it was going to be rough," McLean said.

In December, after losing a large contract that would have amounted to half the year's production, the company started preparing for the inevitable loss of revenue, McLean said.

That's when the company applied for the disaster loan program. It still has until the end of the year to take advantage of it, McLean said.

The disaster loan program went into effect in October 2001, and the filing period to apply for a loan ends Sept. 30. The maximum loan amount is $1.5 million.

Only loans in excess of $5,000 require collateral. The SBA determines the term of each loan according to the borrower's ability to repay.

Interest rates are determined by formulas set by law and are recalculated quarterly. The maximum loan term is 30 years, and the maximum interest rate is four percent.

It is noted on the SBA Web site that a business that has experienced a general decline in business since Sept. 11 is not eligible for the disaster loan program, unless the decline was the direct result of the destruction of the World Trade Center, the damage to the Pentagon or related federal actions.

A decline in revenue due to public reaction in the wake of Sept. 11 is not covered by the program.

Detailed information regarding the Expanded Economic Injury Disaster Loan Program is available at www.sba.gov.