Boeing announces 10 percent reduction of its workforce amid COVID-19 fallout

By Rahul Vaimal, Associate Editor
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Boeing expects a 10 percent staff decrease amounting to more than 14,000 jobs as it struggles to cope with the effects of the extended halt of its signature jet combined with a global pause in air travel.

The Chicago based aviation company, which published a loss of $1.7 billion, engages more than 1,50,000 people globally and said expects to cut nearly 10 percent of its total workforce. Details are limited regarding where those job cuts would come from or what is the total number of jobs Boeing plans to cut, but the figure would equal more than 14,000 of its U.S. employees.

David Calhoun 
President & CEO, The Boeing Company

“That is 10% in total for the enterprise. We’ll have to make even deeper reductions in areas that are most exposed to the condition of our commercial customers — more than 15% across our commercial airplanes and services businesses, as well as our corporate functions.”

The 737 Max crisis along with COVID-19 has cost Boeing. CEO Dave Calhoun addressed employees stating that the losses would be steeper in the commercial airplane division, based in Renton, Washington.

The job cuts will put additional stress on an economy already stumbling from more than 26 million jobs lost because of the pandemic. Boeing’s job cuts will also generate a ripple effect among its many suppliers across the nation.

Boeing 737 MAX | Image used for Representational purpose only

The company’s 737 Max commercial jetliner has been grounded for more than a year after flawed flight control systems played a role in two deadly crashes that killed 346 people. The federal government launched criminal and civil investigations following the crashes, including an investigation into whether Boeing deceived airlines about the training needed to fly the Max.

The company’s first-quarter financial report revealed the toll of the consolidated losses from the Max grounding and the widespread impact from the coronavirus. Boeing reported a quarterly loss of $1.7 billion in the first quarter of 2020.

In the first quarter alone, the company was slapped with a $137 million production charge related to COVID-19 in the Seattle area and a $336 million charge related to replacing a cracked airplane part called the pickle fork in its older 737 Next Generation jets.


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