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Boeing delivers layoff notices to 17,000 workers amid financial struggles

Sheri Walsh

Thu, November 14, 2024 at 5:47 AM GMT+1

Boeing started issuing layoff notices this week to 17,000 employees, or 10% of its workforce, in an effort to cut costs amid financial struggles. The aerospace giant also announced it will delay delivery of its 777X to 2026. File Photo by Bill Greenblatt/UPI

Nov. 13 (UPI) -- Boeing started issuing layoff notices Wednesday to 17,000 employees to cut 10% of its workforce in an effort to shore up the aerospace giant's shaky finances.

The layoff notifications, which will be handed out through Friday, are being issued the same week 33,000 Boeing machinists in the Seattle area returned to work following their seven-week strike.

"Our business is in a difficult position, and it is hard to overstate the challenges we face together," Boeing chief executive officer Kelly Ortberg told staff in a memo last month as he announced the cuts.

"Restoring our company requires tough decisions, and we will have to make structural changes to ensure we can stay competitive and deliver for our customers over the long term," Ortberg added.

The layoffs will impact executives, managers and employees, but workers who build the aircraft are not expected to be cut. Those who receive notifications are expected to leave the company by Jan. 17.

"We must reset our workforce levels to align with our financial reality and to a more focused set of priorities," Ortberg said, adding that Boeing will "maintain our steadfast focus on safety, quality and delivering for our customers."

In addition to the layoffs, Boeing will delay its first delivery of the 777X to 2026 and conclude production of its 767 Freighters in 2027. Production of the KC-46A Tanker will continue.

The cuts at Boeing follow billions of lost revenue over the past five years and a number of crises, including two 737 Max 8 crashes over a six-month period with the first occurring in October 2018, which was the last year Boeing turned a profit. This year, a door panel blew off a 737 Max jet mid-flight, as regulators investigated Boeing's safety protocols and Max production stalled with the machinists' strike.

"We need to be clear-eyed about the work we face and realistic about the time it will take to achieve key milestones on the path to recovery," Ortberg said.

"We also need to focus our resources on performing and innovating in the areas that are core to who we are, rather than spreading ourselves across too many efforts that can often result in underperformance and underinvestment."