Boeing considers temporary layoffs to save cash during strike by machinists | World News
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Boeing plans to freeze hiring and reduce travel and is considering temporary layoffs. (Photo: Reuters)
Boeing plans to freeze hiring and reduce travel and is considering temporary layoffs to save cash during the factory workers’ strike that began last week, the company told employees Monday.
The company said moves, which include reduced spending on suppliers, were necessary because “our business is in a difficult period.” Chief Financial Officer Brian West detailed 10 immediate cutbacks in a memo to employees. They include a freeze on hiring across all levels, pausing pay increases for promotions, and stopping all travel that isn’t critical.
“We are also considering the difficult step of temporary furloughs for many employees, managers and executives in the coming weeks,” West said.
West said Boeing’s business is ina difficult spot, and “This strike jeopardises our recovery in a significant way.” About 33,000 workers represented by the International Association of Machinists and Aerospace Workers began a strike early Friday. The walkout came after workers rejected an offer with pay raises of 25 per cent over four years.
Boeing has lost more than $ 25 billion since the start of 2019, and burned through $ 4.3 billion in the second quarter of 2024 alone as it stood poised to post another money-losing year.
Stephanie Pope, the head of Boeing’s commercial-airplanes division, cited the company’s $ 60 billion in total debt in urging blue-collar workers to accept the contract offer last week. She called it the best offer Boeing had ever made — and it was endorsed by the union’s local president and negotiators.
But workers who have spoken out before and since the Thursday strike vote said they want raises totalling at least 40 per cent and the restoration of bonuses that Boeing proposes to eliminate.
Additional cost-cutting moves spelled out in the chief financial officer’s memo included eliminating first- and business-class service for anyone who does travel, and stopping spending on outside consultants.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First Published: Sep 17 2024 | 8:32 AM IST
