Boeing repays furloughed workers and presses on with job cuts
Boeing's CEO Kelly Ortberg has confirmed that the company will pay its furloughed workers for their lost wages during a recent seven-week strike. However, despite the decision, Boeing will go ahead with its previously announced plan of cutting down about 10% of its global workforce. The strike was launched by factory workers in September and resulted in a temporary production halt of Boeing's top-selling 737 MAX aircraft.
Boeing's workforce reduction plan and employee morale
Initially, Boeing had put thousands of salaried employees on unpaid leave during the strike, which was led by 33,000 union machinists. However, the company later rescinded the decision after announcing plans to eliminate 17,000 jobs. As Ortberg said in an email to staff members, "We will continue forward with our previously announced actions to reduce our workforce levels to align with our financial reality and a more focused and streamlined set of priorities."
Boeing's contract ratification and production plans
On Monday, Boeing won approval for a contract that guarantees its machinists a 38% salary hike over four years and a $12,000 bonus. The deal practically ended the strike with workers likely to return by November 12. However, despite this, the company hasn't yet revealed when it plans to resume the production of the 737 MAX aircraft.
Boeing's financial challenges and future plans
Boeing has suffered nearly $8 billion in losses this year amid persistent quality issues, including a mid-air panel blowout incident in January. To strengthen its finances, the company raised $24 billion in new capital last month. As part of its restructuring efforts, Boeing may look to sell off some assets while downsizing its workforce to focus on its primary civil planemaking and core defense units.
