Airplane maker eyes consolidation, fuel up of major manufacturing line.

Advanced Aerodynamics & Structures Inc., a small airplane maker in North Hollywood comprised of former Lockheed Corp. workers, could start production of its first aircraft in the next month.

However, company officials said they are in dire need of more space and may soon relocate to Palmdale, where they are being lured by proffered tax incentives and other benefits.

"Probably," replied company founder and Chief Executive Officer Darius Sharifzadeh when asked if AASI will relocate to Palmdale. He added the move has not been finalized but the company will decide on a new location in the next 90 days.

He said the company's present facility on Vanowen Street near the Burbank-Glendale-Pasadena Airport is not big enough to handle full aircraft production. The company's line may soon include a twin-engine corporate jet in addition to a turboprop plane.

Gene Comfort, AASI's vice president of sales and marketing, said the company was considering sites in Virginia and West Virginia. But officials rejected the idea of moving across country when Palmdale and California officials began lobbying it to move to the desert community in northern Los Angeles County, he noted. Comfort said several other states, which he would not identify, tried to get the company to relocate.

Comfort said AASI has not contacted local municipal officials about staying in the area around the airport.

Sharifzadeh said the company needs a 200,000-square-foot production facility with direct access to an airport runway. There is nothing available locally that fits the company's criteria but there is undeveloped space available at Palmdale Airport, he said.

The company will start production of its six-passenger Jetcruzer turboprop in the next few weeks at the North Hollywood facility. Production follows the successful completion of the two-and-a-half-year flight certification process by the Federal Aviation Administration. Comfort said the company is waiting for formal certification from the FAA before starting production.

"We simply need more space. Right here, we have room (about 40,000 square feet) to build two or three a month but we need space to build 10 to 12 a month," he said. "Right now, we don't have a big enough door to get the plane out so we have to take the wings off, transport it over to an airport and put the wings back on."

Company officials said with full production of both the turboprop and the planned twin-jet, AASI could in a few years have more than 600 workers. It now has about 130 workers.

According to Comfort, AASI has orders from individuals and corporations for 50 of the Jetcruzers, a single-engine turboprop. Comfort defined an order as a signed contract with a deposit on the aircraft, which sells for $995,000 each.

Company officials said the prototype of the 10-passenger Stratocruzer twin-jet aircraft is nearly completed and AASI is looking for $50 million to begin the FAA certification process and pre-production work. So far, it has 10 orders for the twin-jet, which will sell for about $3 million each.

Sharifzadeh said the company, which was formed in 1989, is seeking private investors to begin work on the Stratocruzer.

Sharifzadeh, a former commercial airline pilot, designed the prototype of the turboprop in 1983. In 1989, the company was formed by Sharifzadeh and Carl Chen, a former Hughes Aircraft Co. researcher who is now its president. Sharifzadeh and Chen are investors in the company but the main financial backer is Yeh Song-Gen, who Comfort said is a Taiwanese businessman. Yeh is chairman of AASI.

So far, Sharifzadeh, Chen and Yeh have put more than $20 million into the company, said Sharifzadeh. He would not be more specific.

The three investors began the company by hiring former Lockheed Corp. engineers and other skilled workers who did not want to leave the area when the corporation moved its aircraft production operations out of Burbank to Georgia three years ago. About 85 percent of AASI employees are former Lockheed workers, said Comfort.

The Lockheed workers, said company officials, have helped develop what they said is a unique design in small aircraft. Both the turboprop and jet aircraft have small wings in the front and larger wings in the back. The fuselage on both planes is made out of composite material that is lighter and more durable than metal products, the officials said.

Industry experts have said the recession has seriously hurt small aircraft companies and AASI will have a tough time competing against such industry nameplates as Gulfstream, Beech Aircraft, Cessna and Lear.

But AASI officials countered that their planes are priced to beat the competition.