From Business Insider · Pete Syme · · 1m 30s
Boeing cuts 2,500 jobs as 737 Max ramp stalls
The aircraft maker announces layoffs in its commercial division after failing to hit production targets, citing overstaffing.
In brief
The aircraft maker announces layoffs in its commercial division after failing to hit production targets, citing overstaffing. Boeing is cutting five percent of its commercial airplanes division, roughly twenty five hundred workers, after production increases took longer than expected. Originally reported by Business…
Boeing announces major layoffs
Boeing announced Monday it will cut five percent of staff in its commercial division, which makes the seven three seven and other airplanes used by millions of travelers worldwide.
Production targets missed
The layoffs stem from Boeing's inability to increase production as quickly as hoped. Boeing CEO Kelly Ortberg told investors in October that increasing production was taking longer than expected.
Division now overstaffed
The commercial division's CEO, Stephanie Pope, said in an internal memo that the company is now overstaffed. Boeing had hoped to produce forty seven of the seven three seven Max a month this year.
“overstaffed”
Scale of the cuts
The commercial airplanes division employs about fifty thousand people. The planned five percent reduction is equivalent to roughly twenty five hundred employees, with notifications beginning in December.
Division losing money
The commercial airplanes division accounted for forty four percent of Boeing's revenue last quarter but made a six hundred ninety seven million dollar loss. Boeing's Defense and Space and Global Services divisions were profitable.
Support for affected workers
Boeing said it will support staff through company-sponsored outplacement services, layoff benefits, and employee assistance program support. Cuts will happen through a combination of attrition and involuntary layoffs.
The short version
Boeing is cutting five percent of its commercial airplanes division, roughly twenty five hundred workers, after production increases took longer than expected.
