Boeing Plans New Staff Buyouts
August 18 2020 - 9:05AM
Dow Jones News
By Doug Cameron
Boeing Co. plans more job cuts in response to a pandemic-driven
drop in jetliner demand it expects to continue for at least three
years.
The aerospace giant told its employees in a memo late Monday
that it is adding a second round of buyout offers, a move that
would further reduce its workforce by an unspecified number beyond
the cut of 19,000 already announced in July.
The company has increased the target set in April of cutting
overall staff numbers by around 10%, according to the memo to staff
from Chief Executive David Calhoun.
Further details are expected on Aug. 24.
Boeing and rival Airbus SE are both wrestling with the future
size and shape of the jetliner industry after a summer recovery in
air travel faltered as coronavirus cases flared up again. Rising
Covid-19 cases and new travel restrictions have nixed much of the
nascent recovery in airline traffic, especially in the U.S., even
as carriers cut fares and rolled out enhanced safety measures.
Boeing said in July that it is also weighing further changes to
its manufacturing footprint, including the possible closure of one
of the two assembly sites for its 787 Dreamliner.
More than 6,000 workers have already left the company, mostly at
its commercial airplane operation in the Seattle area and units
providing airlines with services such as parts and maintenance.
"I truly wish the current market demand could support the size
of our workforce," said Mr. Calhoun in the memo.
Boeing has cut production of the 787 and larger 777 jet, and is
making only a handful of its 737 MAX aircraft as it awaits
regulatory approval for that plane to resume commercial flying
following two fatal accidents. Airlines and leasing companies
continue to defer and cancel aircraft deals.
Boeing has raised billions of dollars in fresh debt in a move
that executives said will help it through the crisis. It still
hopes to start generating free cash again early next year and start
repaying debt that analysts expect to top $60 billion.
Write to Doug Cameron at doug.cameron@wsj.com
(END) Dow Jones Newswires
August 18, 2020 09:50 ET (13:50 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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