The Boeing group said on Friday that it would reduce its global workforce by around 10% in the coming months, which could affect up to 17,000 jobs. This decision is part of a series of measures intended to redress the finances of the aircraft manufacturer, heavily affected by production problems, the strike of more than 33,000 workers since mid-September, and a drop in demand. “Our company is in a difficult position,” Boeing CEO Kelly Ortberg acknowledged in an internal statement.
In this letter addressed to the group’s 170,000 employees, Kelly Ortberg above all explained that the job cuts would affect all categories of staff, including executives. “Details will be provided next week by line managers,” he said, adding that technical unemployment measures, put in place since September 20 to save cash during the strike, would be suspended.
Thousands of employees on partial unemployment
These partial unemployment measures concerned all categories of staff, except strikers, affecting several tens of thousands of employees in rotation. The strike, orchestrated by the IAM machinists union in the Seattle area, notably paralyzed the main factories in Renton and Everett, affecting the production of the 737, 777 and 767. Boeing would have suffered losses estimated at a billion dollars per month due to this strike.
Alongside the announcement of the job cuts, Boeing once again postponed the delivery of its wide-body aircraft, the 777X. The group specified that the first delivery of the 777-9 model would now be expected in 2026, and that of the 777-8 in 2028. These aircraft were initially scheduled to enter service in 2020, but successive delays disrupted this program. Boeing also confirmed that it will cease production of the freighter version of the 767 in 2027, although military versions of the 767, such as the KC-46A tanker aircraft, will continue to be manufactured.
Financial forecasts at half mast
In its forecast for the third quarter, the results of which will be published on October 23, Boeing announced that it expected heavy costs. The Commercial Aviation division (BCA) is expected to record a pre-tax charge of $3 billion, including $2.6 billion related to the 777X program and $400 million for the 767. The Defense, Space and Security (BDS) branch will also experience a pre-tax charge of $3 billion. ‘approximately $2 billion linked to several fixed-cost programs. Its turnover is expected to reach $5.5 billion with an operating margin of -43.1%.
At the group level, Boeing expects overall revenue of $17.8 billion and a net loss of $9.97 per share. “Reestablishing the group requires difficult decisions and we must make structural changes to ensure that we remain competitive and that we serve our customers over the long term,” concluded Kelly Ortberg in her internal press release.
