Boeing to cut more jobs amid faltering profits
US aircraft manufacturer Boeing has announced new involuntary layoffs to reduce costs, one of the company’s many such arrangements this year to save its faltering profits.
The firings follow a round of voluntary buyouts Boeing offered to its staff in January. Back then, more than 300 engineering and technical staff and 1,500 members of the Machinists union accepted the offer.
Boeing told all of the engineers and around 1,000 of the machinists that they should leave the company permanently this Friday.
“We need to reduce our employment levels further,” John Hamilton, vice president of engineering at Boeing Commercial Airplanes, wrote in a memo, according to The Seattle Times.
In late March, Boeing issued another 245 involuntary layoff notices that will take effect in mid-May.
This is while, since January last year, the company has fired 1,332 engineering and technical employees from its Washington workforce.
The job cuts come despite previous rounds of voluntary reductions and layoffs, in addition to further cuts through natural attrition.
“We anticipate (Friday’s notices) will impact hundreds of engineering employees,” read the memo by Hamilton. “Additional reductions in engineering later this year will be driven by our business environment and the amount of voluntary attrition.”
Despite cutting a total of 7,400 jobs last year, Boeing Vice Chairman Ray Conner and the new chief executive of Boeing Commercial Airplanes, Kevin McAllister, warned of more cuts in 2017 due to “fewer sales opportunities and tough competition.”
The Washington Examiner says the number of all voluntary and involuntary cuts over the past year, mainly through buyouts and retirements, exceeds 9,000.
The Chicago-based aviation giant, which employs more than 74,000 people, reported $95 billion in revenue last year.
The company risked losing a major contract in December, when then President-elect Donald Trump said the government of former President Barack Obama should cancel an order with Boeing for building new Air Force One planes.
“Boeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion. Cancel order!” he wrote in a tweet.
Boeing managed to save the deal after negotiating a price cut with the new Republican president.