Boeing has been making losses for years. In order to adapt the number of employees to “financial reality”, the US aircraft manufacturer plans to cut around 17,000 jobs. At the same time, a strike takes its toll on the company.
Amid the strikes at Boeing, the ailing US aircraft manufacturer has announced that it will cut around ten percent of its global jobs in the coming months – around 17,000 jobs. The downsizing of the workforce is intended to help overcome the company's current financial problems, Boeing said.
Accordingly, the current strike by more than 33,000 Boeing employees in particular is causing the company's results to plummet in the third quarter. Boeing CEO Kelly Ortberg said the company needed to “reset headcount numbers to bring them in line with our financial reality.” The global job cuts should therefore also affect the management level.
Boeing postpones 777X delivery
Boeing also announced that it would postpone delivery of its new wide-body 777X from 2025 to the following year. Production of the 767 freighter will stop in 2027.
The Boeing strike around the US metropolis of Seattle began in mid-September. Among other things, the employees are demanding more wages. Two days of negotiations ended this week without an agreement. Boeing recently offered the striking workers an income increase of 30 percent over the four-year term of the contract. After the union refused to accept this, Boeing withdrew the offer.
Boeing workers had accepted several zero rounds over the past decade. The union last went on strike in 2008. Due to the current work stoppages, assembly of the Boeing 737 Max and 777 aircraft came to a virtual standstill. According to estimates by the rating agency S&P, the labor dispute is costing Boeing a billion dollars a month.
Boeing only recently began sending employees on temporary compulsory leave on a rotating basis. Ortberg announced that these measures would now be suspended due to the impending layoffs.
One billion less sales than expected
Boeing also announced preliminary key figures for the third quarter. Sales are expected to be $17.8 billion, which is almost a billion less than experts previously expected. The loss per share is said to be just under ten dollars. Since the beginning of 2019, Boeing has suffered losses of more than $25 billion.
The group also sees a need for depreciation of five billion dollars (around 4.57 billion euros). The commercial aircraft division is responsible for three billion US dollars, the rest goes to the defense, space and security sectors.
