The fuselage of a plane bound for Boeing’s 737 Max production facility waits for shipment on a railroad siding at Boeing’s top supplier Spirit Aerosystems Holdings Inc. in Wichita, Kansas, Dec. 17, 2019.
Nick Oxford | Reuters
boeing supplier Spirit Aero Systems As the aircraft maker’s machinists strike enters its sixth week, a company spokesperson announced Friday that it will furlough about 700 employees.
More than 32,000 Boeing employees resigned on September 13 following overwhelming rejection of a temporary collective bargaining agreement with the company, deepening the financial burden on the aircraft maker in just two months. He has entrusted a new challenge to CEO Kelly Ortberg, who took the helm not too long ago.
About 5% of Spirit’s U.S. workforce is furloughed, according to its most recent annual report.
The furloughs affect employees at Spirit’s largest facility in Wichita, Kansas, and represent about 5% of Spirit’s U.S. workforce, according to the company’s latest annual report. Meanwhile, Boeing and its machinists’ union remain at an impasse, and Spirit is considering further cuts.
“If the strike continues beyond November, we will have to implement layoffs and additional furloughs,” Spirit spokesman Joe Buccino told CNBC on Friday.
Ortberg, who is scheduled to hold his first earnings conference with investors next Wednesday, announced last week that he aimed to cut costs, including cutting 10% of the workforce, or about 17,000 jobs, as the company’s losses widened. announced a series of drastic measures. Boeing also said it plans to end commercial production of the 767 when orders are completed in 2027, and the long-delayed debut of the 777X widebody aircraft will be delayed by another year to 2026.
Boeing is raising debt or equity to increase liquidity.
Buccino said the roughly 700 Spirit employees affected by the 21-day furlough are assigned to Boeing’s 777 and 767 programs, and Spirit has “substantial inventory.” It is said that they are piling up. Spirit workers on Boeing’s best-selling 737 Max plane are not affected, he added. However, work on all three programs has stalled due to the strike.
Boeing agreed to buy Spirit this summer, but the companies expect the deal to close in mid-2025. Reuters earlier reported Spirit’s latest furlough.
