Aircraft manufacturing company Boeing to fire 17000 people amid crisis

Boeing has announced a sweeping workforce reduction, planning to eliminate 17,000 jobs, or 10% of its global workforce, amid mounting financial losses exacerbated by a recent machinist strike in the Seattle area. Chief Executive Kelly Ortberg emphasized that the company needs to “reset our workforce levels to align with our financial reality,” noting that the cuts will affect all levels, including executives, managers, and employees.

The decision follows a turbulent period for Boeing, which recently faced a month-long strike involving 33,000 employees affiliated with the International Association of Machinists and Aerospace Workers. The strike began on September 13 after union members overwhelmingly rejected Boeing's contract proposal, leading to disruptions that have severely impacted Boeing’s commercial aviation sector. The strike is expected to result in a $3 billion pre-tax charge for the third quarter, contributing to a projected loss of $9.97 per share.

In response, Boeing has initiated cost-cutting measures and revised its production schedule. Ortberg outlined plans to delay the first delivery of its 777X model from 2025 to 2026, and the company intends to halt production of the 767 Freighter in 2027 after fulfilling current orders.

Ortberg also addressed ongoing challenges in Boeing's defense and space sectors, which he noted would incur “substantial new losses” in the third quarter. To address these setbacks, Boeing will implement “additional oversight” in these areas.

“This is a challenging moment, but we’re committed to making strategic choices that will ultimately strengthen Boeing’s position,” Ortberg said, emphasizing the importance of long-term competitiveness.

Following these announcements, Boeing’s stock declined by 1.7% in after-hours trading, reflecting investor concerns over the company’s ability to recover from these setbacks.