Boeing, an organization that once was one of the faces of American Engineering expertise is currently amidst its worst existential crisis. Thousands of Boeing staff are set to receive lay-off notices in the coming weeks. Last Friday, the firm announced a 10% workforce reduction. This amounts to a massive 17,000 jobs. The firm will send out 6o-day notices to thousands of workers starting next month. This will include many from the commercial aviation division. Based on sources from Reuters, The staff receiving notices next month will leave the company by mid-January. There have been speculations that the second phase of notices will be rolled out in December. The layoffs and delays in the 777X model underscore the depth of the Boeing crisis.
The International Association of Machinists(IAM) strike now clocking its second month has crippled Boeing’s production line at Everett, Washington. Based on the consulting firm, Anderson Economic Group, the projected loss is anticipated to be $5 Billion.
Kelly Ortberg who took over the helm in August, communicated this gore reality to all the employees through an email last Friday. His tenure has been tough amid the scandalous landscape and financial concerns. Earlier this year, the company pleaded guilty to defrauding the Federal Aviation Administration(FAA) due to the concealment of a faulty system in “737Max”, a flaw that led to deadly crashes, tarnished its market reputation and led to nearly $1 Billion in fines.
Adding to its list of concerns, the highly anticipated next-generation aircraft 777X is delayed and deliveries are pushed to 2026 due to development and testing issues. The postponement has led to severe financial setbacks for suppliers. As per Anderson Economic Group, The estimated loss for suppliers is $900 million due to a halt in production.
While Boeing stands as a key player in the Aerospace industry, its recent string of woes and setbacks does not augur well for its future. A spiralling debt, delayed product rollout and ongoing labour concerns cast a shadow over its future. The company’s ability to raise funds from the market will be crucial in determining its recovery and growth.
