Boeing to cut more than 12,000 US jobs on top of 6,770 layoffs
The planemaker, which had zero orders in April, says it plans to layoff thousands more, but does not state where
Washington — Boeing said on Wednesday that it is eliminating more than 12,000 US jobs, including involuntary layoffs of 6,770 US workers, as the largest American planemaker restructures in the face of the coronavirus pandemic.
Boeing also disclosed that it plans “several thousand remaining layoffs” in the next few months but did not say where those would be.
The company announced in April it would cut 10% of its worldwide workforce of 160,000 by the end of 2020. Boeing said on Wednesday that it has approved 5,520 US employees to take voluntary layoffs and they will leave Boeing in the coming weeks. Boeing also disclosed it is notifying 6,770 workers this week of involuntary layoffs.
Boeing is moving to cut costs as it faces a drop in aircraft demand due to the Covid-19 pandemic.
Boeing CEO Dave Calhoun told employees in an e-mail that the “pandemic’s devastating impact on the airline industry means a deep cut in the number of commercial jets and services our customers will need over the next few years, which means fewer jobs on our lines and in our offices ... I wish there were some other way”.
Boeing shares rose 0.7% in midday trading to $145.76.
In April, Boeing recorded zero orders for the second time this year and customers canceled another 108 orders for its grounded 737 MAX plane, compounding its worst start to a year since 1962.
The pandemic worsened a crisis for the company in which the 737 MAX was grounded last year after the second of two fatal crashes.
Last month, Boeing raised $25bn in a bond offering that allowed the company to avoid taking government aid.
The job cuts include more than 9,800 employees in Washington State. Boeing said on Wednesday that the “several thousand remaining layoffs will come in additional tranches over the next few months”.
Boeing said it expects to resume 737 MAX deliveries in the third quarter following regulatory approvals, with production restarting at low rates in the second quarter before gradually increasing to 31 a month during 2021.
“We’re moving forward with our plan to restart 737 MAX production in Renton, Washington,” Calhoun said in his e-mail.
Reuters reported in April 737 MAX approval is not expected until at least August.
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