Boeing plans about 5% commercial aircraft workforce reduction as jet output slows

Boeing says it will no longer meet its 2026 delivery target

Boeing announced Monday it will cut about 5% of its commercial aircraft workforce, removing the positions through a mix of layoffs and attrition. The company said the reduction follows a slower ramp-up in jet production.

In a message to employees, Boeing commercial chief Stephanie Pope said the slower ramp-up would “provide our factories and supply chain partners additional time to achieve stability.” She added: “Adjusting our production schedules and reducing aircraft output puts us in an overstaffed position.”

Layoff notifications will begin in December. Pope said Boeing would treat employees with “dignity and respect” as the company moves ahead with the reductions.

The Guardian’s report was accompanied by a photograph of a Boeing logo at the company’s facility in Everett, Washington, taken on 21 January 2020 by Lindsey Wasson/Reuters.

October delivery and production-rate changes

Boeing executives signaled slower plans to raise plane output in a late October conference call. On that call, executives said the company would no longer meet its target for 2026 deliveries.

The same call set a later date for a higher 737 Max production rate. Executives said Boeing had pushed back the timeframe for lifting 737 Max production to 52 from 47 until the second half of 2027.

Boeing’s workforce announcement came after that call, and the job cuts are the company’s response to the slower ramp-up executives described.

Certifications, financial context and Ortberg’s October assessment

Pope praised the team for improved operations reflected in US certifications this year of the 737 Max 7 and 737 Max 10. “While we have made substantial progress, we have not yet fully recovered,” she said.

The Guardian reported that investors have viewed raising 737 Max output as central to revenue and profit growth after a long period of financial losses due to safety problems, including two deadly Max crashes in 2018 and 2019.

CEO Kelly Ortberg described the company’s position in October. “We’re making progress, but we still have more work to do, and I’m expecting it’ll take us into next year to get fully stable at this rate,” he said. Ortberg cited the need for greater predictability in wing production and with the production of fuselages at Boeing’s Kansas operation.