(New York) Boeing announced on Friday a reduction in the coming months of around 10% of its global workforce, which should affect around 17,000 jobs, as well as a series of measures affecting its aircraft catalog, in an attempt to to overcome financial difficulties.
In two separate messages broadcast on Friday, the aircraft manufacturer also announced a further postponement of deliveries of its new wide-body 777X and the cessation of production of the 767 freighter in 2027.
He also warned that his third quarter results would be weighed down by heavy costs due, in particular, to the strike of more than 33,000 workers since mid-September.
In electronic trading after the New York Stock Exchange closed, Boeing shares fell 1.87%. It ended the session up 3%.
The reduction in personnel will affect all categories – management, management, employees – said Kelly Ortberg, boss of Boeing for two months, in a message addressed to the group’s 170,000 employees.
He added that details would be provided next week by line managers, indicating that the partial furlough measures put in place since September 20 to preserve the group’s cash flow during the strike were suspended.
They also concerned all categories of staff – except strikers – and affected several tens of thousands of people in rotation.
The strike by members of the IAM machinists’ union in the Seattle region brought, among other things, a complete shutdown of the group’s two main factories: that of Renton, which produces the 737, its best-selling plane, and that of Everett, which manufactures the 777, the 767 as well as several military programs.
Vain negotiations
Production of the 787 Dreamliner is the only one still in operation, because the factory is located in South Carolina, and the employees are not unionized.
Several months of negotiations, including under the aegis of federal mediation since mid-September, did not allow the union and Boeing to agree on a new four-year social agreement.
“Our company is in a difficult position,” noted Kelly Ortberg in her message.
PHOTO PROVIDED BY BOEING, AGENCE FRANCE-PRESSE ARCHIVES
Kelly Ortberg, boss of Boeing for two months
According to him, “reestablishing the group requires difficult decisions and we must make structural changes to ensure that we remain competitive and serve our customers in the long term”.
Adding that Boeing had to “focus [ses] resources” on its fundamentals, Mr. Ortberg announced that the long-haul 777X twinjet program would once again suffer a delivery delay.
According to a press release published alongside his message, the first delivery of the 777-9 should take place in 2026 (instead of 2025) and that of the 777-8 in 2028. The first aircraft in this range were initially to be put into service in 2020.
The group also intends to deliver the 767 transport aircraft that have been ordered to date, but will stop their commercial production from 2027. It will, however, continue production of versions intended for the KC-46A military refueling aircraft.
The group also warns in its press release that its third quarter results, which are scheduled to be published on October 23, will be reduced by several billion dollars in expenses in its Commercial Aviation (BCA) and Defense, Space and Security (BDS) branches. ).
“Our business is facing short-term challenges and we are making important strategic decisions for our future,” noted Mr. Ortberg, adding that he has a “clear vision of the work we must do to restore the group.”
The BCA branch is expected to record a pre-tax charge of $3 billion under programs 777X ($2.6 billion) and 767 ($400 million). Its quarterly revenue is expected to reach $7.4 billion, with a negative operating margin of -54%.
This charge arises from the suspension of the 777X certification process as well as, for both programs, the consequences of the strike.
The BDS branch will once again be marked by a charge linked to several fixed-cost programs, which is expected to reach $2 billion. The turnover should come out to 5.5 billion dollars and the operating margin to -43.1%.
Concerning the group as a whole, the turnover should therefore amount to 17.8 billion dollars and the net loss to be 9.97 dollars per share.