TracPlus cuts 30 jobs from workforce

DUNEDIN tracking and communication company TracPlus has confirmed it has cut its staff back from 47 to 17 after Covid19 disruptions in the aviation sector derailed projected growth at the company.

TracPlus started a consultation with staff about two weeks ago over cutting 14 jobs, and that was soon followed by a request for voluntary redundancies.

Chairman John O’Hara said the company decided to get the redundancies done before a deadline of October 30, which was the cutoff for applying for the Government’s income relief payment.

As well as the 14 redundancies decided by TracPlus, a further 16 people took voluntary redundancy.

Mr O’Hara said operations would not be too badly affected by the layoffs.

‘‘Not as much as you might think on first glance.

‘‘We’ve made some mistakes. One of the mistakes we made was that we geared up for growth we expected to happen and that growth hasn’t happened.’’

Covid19 had affected the aviation industry — where a large part of TracPlus’ clients were — probably more than any other sector apart from tourism, he said.

‘‘Whilst a lot of our customers are firefighting organisations, a lot of them, those aircraft are used occasionally for firefighting and the rest of the time they’re used for charter and sightseeing work.’’

TracPlus was also facing a ‘‘technology headwind’’, where some flight tracking software was available for free online, Mr O’Hara said.

‘‘It poses a competitive to everybody that relies on satellites.

‘‘It’s not universal, it doesn’t work in mountain ranges or low level where helicopters tend to be . . . but it means there’s a lot of pricing pressure from customers and it means it’s getting a bit harder.’’

TracPlus was largely a software company that built its products on top of hardware already in use, which meant it was somewhat protected from the technology challenges, he said.

However, it did purchase Cambridge company v2track Limited earlier in the year, which was a hardware company.

TracPlus’ revenue was sitting about the same as it was in 2019.

Chief executive Trevor McIntyre described the layoffs and the effects of Covid19 as putting the company on a ‘‘oneyear hiatus’’, or stepping back a year.

‘‘The market’s changed underneath us and we needed to pull back, contract, reassess [and] look how we can offer the same, if not better, services through tech and innovation to these customers and deploy in a way forward that’s sustainable.

‘‘I think many companies have had to take that pause and . . . reassess and go again. It’s a challenge everyone is facing.’’

While some of the company’s customers had gone out of business, the vast majority had suspended their accounts, Mr McIntyre said.

‘‘Should those operators start flying . . . some tourism, some agriculture work, some firefighting, some first responder work, we expect that revenue to come back.

‘‘They have not got rid of their devices they’ve just suspended their plans because they’re not flying at the moment.’’