By 
Boeing Co said on
Wednesday it was eliminating more than 12,000 US jobs, including 6,770
involuntary layoffs, as the largest American planemaker restructures in the
face of the coronavirus pandemic.
Wednesday it was eliminating more than 12,000 US jobs, including 6,770
involuntary layoffs, as the largest American planemaker restructures in the
face of the coronavirus pandemic.
Boeing also disclosed it plans “several
thousand remaining layoffs” in coming months but did not say where those
would take place.
thousand remaining layoffs” in coming months but did not say where those
would take place.
Boeing is slashing costs as a sharp drop in
airplane demand during the pandemic worsened a crisis for the company whose 737
MAX jet was grounded last year after a second fatal crash.
airplane demand during the pandemic worsened a crisis for the company whose 737
MAX jet was grounded last year after a second fatal crash.
Boeing said it restarted 737 MAX production
at a “low rate” at its Renton, Washington factory.
at a “low rate” at its Renton, Washington factory.
Reuters reported in April that regulatory
approval for the MAX was not expected until at least August.
approval for the MAX was not expected until at least August.
Boeing shares closed up 3.3% at $149.52, then
rose another 4.6% to $155.84 after hours on news of the MAX production restart.
rose another 4.6% to $155.84 after hours on news of the MAX production restart.
The company announced in April it would cut
10% of its worldwide workforce of 160,000 by the end of 2020.
10% of its worldwide workforce of 160,000 by the end of 2020.
Boeing said Wednesday 5,520 US employees will
take voluntary layoffs, and also disclosed it was notifying 6,770 workers of
involuntary layoffs.
take voluntary layoffs, and also disclosed it was notifying 6,770 workers of
involuntary layoffs.
Chief executive Dave Calhoun told employees
in an e-mail the “pandemic’s devastating impact on the airline industry
means a deep cut in the number of commercial jets and services our customers
will need over the next few years, which in turn means fewer jobs on our lines
and in our offices… I wish there were some other way.”
in an e-mail the “pandemic’s devastating impact on the airline industry
means a deep cut in the number of commercial jets and services our customers
will need over the next few years, which in turn means fewer jobs on our lines
and in our offices… I wish there were some other way.”
CFRA analyst Colin Scarola upgraded Boeing to
buy and raised his price target to $174 from $112 saying Boeing “can
weather its current crises and grow over the long term.”
buy and raised his price target to $174 from $112 saying Boeing “can
weather its current crises and grow over the long term.”
In April, Boeing recorded zero orders for the
second time this year and customers canceled another 108 orders for the 737
MAX, compounding its worst start to a year since 1962.
second time this year and customers canceled another 108 orders for the 737
MAX, compounding its worst start to a year since 1962.
Last month, Boeing raised $25bn in a bond
offering that allowed it to avoid taking government aid.
offering that allowed it to avoid taking government aid.
The job cuts include more than 9,800
employees in Washington State.
employees in Washington State.
Boeing said the “several thousand
remaining layoffs will come in additional tranches over the next few
months.”
remaining layoffs will come in additional tranches over the next few
months.”
Boeing said it expects to resume 737 MAX
deliveries in the third quarter following regulatory approvals before gradually
increasing to 31 per month during 2021.
deliveries in the third quarter following regulatory approvals before gradually
increasing to 31 per month during 2021.
The aerospace sector has been hard hit
including many Boeing suppliers.
including many Boeing suppliers.
General Electric Co said this month it
planned to cut its aviation unit’s global workforce this year by as much as
25%, or up to 13,000 jobs.
planned to cut its aviation unit’s global workforce this year by as much as
25%, or up to 13,000 jobs.
SpiritAero Systems Holdings announced it is
cutting another 1,450 jobs in Kansas.
cutting another 1,450 jobs in Kansas.
