Yu Dynasty Yingdala (4338-4636)

[Wu Han]

Xiandai Group Stock Price Lowest in 20 Years; Announces Major Job Cuts
Group struggling after aircraft development fails to deliver results, legislative changes affect bottom line
HAZHOU, SHU - 20 December 4278



Xiandai Group, one of Indrala's five biggest companies, announced today that they would be cutting around 36,000 jobs. Most of the job losses will be concentrated in Shu Province, the nation's manufacturing heartland. In a press release, the company blames a drop in the stock price, which usually trades at around ~2,400 INS per share has dropped to ~1,682 INS per share, as causing significant strain on the corporation's bottom line. The drop in stock price has been attributed to three major factors. First, the Xiandai Commercial Aircraft Manufacturing Company (subsidiary) has found trouble finding customers for its new X400 commercial jet, which cost an estimated $12B+ to develop. Indralair, has not indicated any interest in purchasing the X400, opting for foreign jets instead. The second factor is that due to legislation passed by the Republican government, the Central Bank divested all shares it owned in Xiandai, causing downward pressure on the stock price. The Central Bank invested in the Xiandai 4 years ago to help finance the X400 development, gaining a 2.5% stake in the company. Finally, the company has announced that the number of Xiandai vehicles sold this year has sharply fallen from the last, as the Indralan automotive industry continues to contract and struggle in the face of foreign competition.

Around 31,000 of the 36,000 jobs that will be cut are located in Shu province, as the company looks to drastically scale back its aircraft manufacturing subsidiary. Economists estimate that a further 24,000 jobs indirectly tied to the Xiandai Commercial Aircraft Manufacturing Company will be lost as well. This decision will exacerbate the economic hardship in Shu, especially following the 4255 manufacturing crisis from which it has never fully recovered. The total number of people employed by the Xiandai Group will fall from 416,840 to around 380,840.

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Originally posted by Wu Han on 28 September 2017.