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Boeing To Cut 10% Workforce As It Sees Big Q3 Loss
By Kayode Sanni-Arewa
Boeing To Cut 10% Workforce As It Sees Big Q3 Loss
The company plans to cease production of the 767 Freighter in 2027 once it completes production on current orders.
Boeing announced that it plans to cut 10 per cent of its workforce as it projected a large third-quarter loss amid a machinist strike in the Seattle region.
The aviation giant must “reset our workforce levels to align with our financial reality,” Chief Executive Kelly Ortberg said on Friday, adding that the cuts of 17,000 positions globally “will include executives, managers and employees.”
The company announced a series of belt-tightening measures and production delays as the nearly monthlong strike of 33,000 workers has added to the company’s litany of problems.
Boeing staff with the International Association of Machinists (IAM) and Aerospace Workers walked off the job on September 13 after overwhelmingly rejecting a contract offer.
IAM officials did not immediately respond to a request for comment from AFP.
Boeing, which has also faced significant scrutiny over commercial aviation safety lapses and stumbles in its Starliner space program, said the IAM strike contributed to $3 billion in pre-tax charges to its commercial aviation results in the third quarter, part of an anticipated loss of $9.97 per share.
“While our business is facing near-term challenges, we are making important strategic decisions for our future and have a clear view on the work we must do to restore our company,” Ortberg said in a press release.
“These decisive actions, along with key structural changes to our business, are necessary to remain competitive over the long term.”
Details of the cuts would come next week, he said.
As a result of the strike, Boeing said it is pushing back first delivery of the 777X to 2026 from 2025. The much-delayed jet was originally supposed to enter service in January 2020.
The company plans to cease production of the 767 Freighter in 2027 once it completes production on current orders.
Ortberg also vowed to take “additional oversight” of Boeing’s troubled defense and space businesses, which will experience “substantial new losses” in the third quarter, he said in the message to employees.
– Criminal settlement questioned –
Ortberg joined Boeing in August after a leadership shakeup initiated in the wake of a January incident on Alaska Airlines in which a window blew out mid-flight, necessitating an emergency landing on a 737 MAX, the aircraft involved in two fatal crashes in 2018 and 2019.
That led to the Federal Aviation Administration tightening oversight of Boeing’s production processes, capping the company’s output. Production on the MAX is now halted due to the IAM strike.
On Friday, a judge in Texas heard arguments on whether to approve a US Department of Justice criminal settlement on the MAX. Family members of MAX victims from the two crashes argued in court against the settlement, asserting that Boeing and former executives should be criminally prosecuted in a public trial.
The IAM strike, meanwhile, has halted activity at two Seattle-area assembly plants.
The striking workers are seeking hefty wage hikes and a reinstatement of their pension, complaining of more than a decade of near-flat wages amid inflation.
Ratings agency S&P estimated this week that the strike was costing Boeing $1 billion per month.
On Tuesday, following two days of unsuccessful negotiations, Boeing suspended the talks, accusing the union of making unreasonable demands and withdrew its offer. Boeing’s most recent offer included a 30 per cent wage hike.
IAM’s negotiating committee said late Friday that Boeing’s withdrawal of its offer at the last talks “will only make it harder to reach an agreement.”
“The fact they are complaining about our proposals shows their desperation and only proves to our members that we are fighting for them,” IAM said in a statement on X, without mentioning Boeing’s plan to slash 17,000 jobs.
Shares of Boeing fell about 1 percent in after-hours trading.
AFP
News
BREAKING! FG delegation in meeting with NLC, TUC
By Kayode Sanni-Arewa
The Federal government delegation is currently meeting with the leaders of organised labour at the Presidential Villa in Abuja.
The meeting is centred on the state of the nation, especially the petrol pricing system.
The meeting is taking place at the Secretary to the Office of the Government of the Federation, SGF, George Akume.
At the meeting are Mallam Nuhu Ribadu, the National Security Adviser, NSA; Nkeiruka Onyejeocha, the Labour Minister; and Wale Edun, Minister of Finance and Coordinating Minister of the Economy.
Others are the Information Minister, Petroleum Minister, State Minister of Gas, and representatives of the Nigerian National Petroleum Corporation, NNPC, Limited.
News
Reps Ask FG To Reverse Petrol Pump Price Hike, Cooking Gas Price
News
PMS Prices Determined By Market Forces, No Price Deal With IPMAN – NNPC
By Kayode Sanni-Arewa
The Nigerian National Petroleum Company (NNPC) Limited has debunked claims that it reached an agreement with the Independent Petroleum Marketers Association of Nigeria (IPMAN), on the price of Premium Motor Spirit (PMS), commonly known as petrol, saying fuel prices are now determined by market forces.
Reports credited to IPMAN President, Abubakar Maigandi had stated that NNPC agreed to reduce the ex-depot price of petrol for its members from N958 per litre to N955 per litre.
Refuting the claim in a statement on Wednesday, the Chief Corporate Communications Officer of the national oil company, Olufemi Soneye, emphasised that under the current deregulated regime, fuel prices are determined by free market forces, as provided for in the Petroleum Industry Act (PIA), 2021 rather than by agreements.
Refuting any form of price deal with Marketers, Soneye said NNPC had only provided a one-time N3 discount to marketers with funds deposited at NNPC to facilitate fuel lifting and prevent shortage, saying the initiative “was a temporary measure”.
Maintaining that prices are still determined by market forces, not by NNPC Ltd, Soneye said, “The market has been deregulated, meaning that petrol prices are now determined by market forces rather than by the government or NNPC Ltd.
“There is no price agreement between IPMAN, NNPC, or any marketer. The market forces determine prices under the current deregulated regime.”
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