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Boeing plans to cut the workforce at its civil aviation unit by 10% to cut costs as the coronavirus causes an airline crisis, two sources familiar with the matter told AFP.
The layoffs would affect the unit that makes the troublesome 737 MAX, which has been grounded for more than a year after two fatal accidents, as well as the long-haul 787 and 777 aircraft, sources said.
Job cuts could affect up to 7,000 workers. Boeing employs more than 160,000 people worldwide, including 70,000 in Washington state, where most of its civil aircraft are assembled. The South Carolina plant produces only part of the 787.
The news comes just a day after the company slowly resumed production at its Puget Sound facility in Washington, with new measures to keep workers six feet away along with health checks and hand washing stations.
Chief Executive David Calhoun wants to settle the downsizing plan before Boeing embarks on complex and delicate negotiations with the United States Treasury to win federal support for the industrial giant, the sources said.
Boeing has sought $ 60 billion in public aid for the US aerospace industry. USA In light of the strong impact on the aviation business due to the coronavirus crisis.
About $ 17 billion earmarked for Boeing was included in the gigantic federal relief bill passed in late March.
But government aid is conditional on companies agreeing not to fire workers once they have received taxpayer money.
A Boeing spokesperson said the company is offering “voluntary layoff” programs, but did not confirm the size of the planned reductions.
Workers making the Boeing voluntary layoff offer would receive a pay-as-you-go package as part of the program that “aims to help reduce the size of our workforce through voluntary actions and, most importantly, minimize future actions of the workforce, “the spokesman said.
Already under strain amid controversy surrounding the best-selling 737 MAX and uncertainties about when the plane will return to the skies, it has suffered a wave of order cancellations from airlines struggling to survive as air travel They have stopped in the midst of the crisis. pandemic blackouts.
Aircraft leasing company Avalon canceled an order for 75 of the 737 MAX aircraft, and the Development Bank of China rejected a request for 29 of the aircraft.
There is also uncertainty about a Norwegian Air order for 92 MAX aircraft and five 787 aircraft after four subsidiaries filed for bankruptcy.
The spokesperson said, “There is no doubt that the aviation industry will look very different as we finally recover from this pandemic.”
Boeing can also replace the executive in charge of the MAX program in announcements that could come when the company releases the quarterly results on April 29, the sources said.
