Boeing announced that it will lay off approximately 10% of its workforce as it struggles to regain stability amidst ongoing financial losses and a crippling strike incident. The cuts will impact about 17,000 workers from various levels including executives and managers, as the company seeks to manage its significant cash burn and fulfill ongoing operational challenges. With the layoff announcement, Boeing also indicated the deferral of its 777X rollout to 2026, reflecting the profound impact on production and development timelines.
The company's new CEO, Kelly Ortberg, outlined in an organizational memo the painful decision to implement layoffs in light of Boeing's financial struggles, saying, "We are experiencing unprecedented challenges. These tough choices are necessary to prepare Boeing for the future and continue our commitment to our customers and stakeholders amidst our current operational inefficiencies and challenges."
Despite a temporary halt to rolling furloughs, the company faces severe cash flow issues, having lost more than $25 billion since 2019. Recent data disclosed that Boeing burned through $1.3 billion in cash during the last quarter alone, prompting further scrutiny and restructuring within the organization's financial strategies and operational obligations.
Boeing's operational turmoil has been exacerbated by an ongoing strike involving around 33,000 union machinists. As negotiations falter, with no agreements reached during recent talks, the company filed an unfair labor practices charge against the union, showcasing the strained relations that are further hindering production and delivery timelines across their key aircraft offerings.
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