Amid the presentation of preliminary results for the third quarter, the new CEO of Boeing, Kelly Otberg, made tough announcements for the company in the coming years.
The chief executive of the planemaker said that there will be a cut of about 10% in the company’s workforce, something like 17,000 employees.
For a month, Boeing has been facing a strike at units in the Puget Sound area, where the traditional Renton and Everett factories are located, and which bring together about 33,000 unionized employees.
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Negotiations have reached an impasse in recent days when Boeing withdrew an offer of a 30% pay increase over the next four years after resistance from employees, who are demanding a larger adjustment.
In addition to the strike, the company is also facing a lengthy public scrutiny that has affected the schedule of new commercial aircraft such as the 737 MAX 7, 737 MAX 10 and the new widebody 777X.
Not surprisingly, Otberg announced another delay in the entry into service of the 777X family. According to him, the 777-9 variant, which is in the certification process, will only be delivered to the first customers in 2026.
The 777-8F freighter, which will replace the popular 777F, has been postponed to 2028.
Boeing also confirmed that production of the 767F will end in 2027 after delivering 29 remaining aircraft, leaving only the assembly line for the KC-46A tanker.
Tough decisions
The CEO cited the recent suspension of flights of the 777-9 test aircraft caused by a structural problem in the engine mounts as one of the reasons for the delay in the program. But Otberg also blamed the “ongoing work stoppage” for this.
“Restoring our company requires tough decisions and we will have to make structural changes to ensure we can remain competitive and deliver for our customers over the long term,” said Kelly Otberg.
The tough decisions come after Boeing reported a record $5 billion loss in the third quarter.
The company’s credit rating and stock market shares are in serious trouble as Boeing considers selling stock and equity securities to raise billions of dollars.
