Boeing to Lay off 10% of Staff, Delay First 777X Delivery
The aerospace giant warned in an email that employees at all levels of the company are at risk.
The aerospace giant warned in an email that employees at all levels of the company are at risk. It comes as a strike by factory workers cripples airplane production.US aerospace company, Boeing announced Friday that it plans to cut 17,000 jobs, or 10% of its global workforce, as it forecasts a significant loss for the third quarter following a machinists' strike in the Seattle area.
Boeing workers affiliated with the International Association of Machinists and Aerospace Workers walked off the job on September 13 after overwhelmingly rejecting a contract offer. The strike, involving 33,000 workers, halted production of Boeing 737 MAX, 767, and 777 planes.
The company needs to "reset our workforce to align with our financial reality," Chief Executive David Calhoun said, adding that the cuts "will include executives, managers, and employees."
In a separate release, Boeing, which reports third-quarter earnings on October 23, said it now expects revenue of $17.8 billion (€16.3 billion), a loss per share of $9.97, and negative operating cash flow of $1.3 billion.
Delay in Delivery of the 777X
Calhoun also said Boeing has informed customers that the company now expects the first delivery of the 777X in 2026, instead of 2025. The delay is due to challenges Boeing has faced in development, as well as the flight test pause and ongoing strike.
Boeing has already faced certification issues with the 777X that have significantly delayed the airplane's launch.
Reaching an agreement to end the strike is critical for Boeing. Ratings agency S&P estimates the strike is costing the company $1 billion a month and puts it at risk of losing its prized investment-grade credit rating.
Even before the strike began on September 13, the company had been burning cash as it struggled to recover from a mid-air panel blowout on a new plane in January that exposed weak safety protocols and prompted US regulators to curb production.
dh/lo (AFP, Reuters)
(The above story first appeared on LatestLY on Oct 12, 2024 04:10 AM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).