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Boeing shares slip 3% on job cut plans, jet delivery delay | Stock Market News
Source: Live Mint
Boeing Co. shares slipped around 3 per cent in early trading session on Monday after the planemaker said it plans to lay off about 10 per cent of its global workforce in the coming months, about 17,000 people.
On Friday, Boeing’s new Chief Executive Officer Kelly Ortberg told staff in a memo that the job cuts will include executives, managers and employees.
“Our business is in a difficult position, and it is hard to overstate the challenges we face together,” Ortberg said in the memo. “Restoring our company requires tough decisions and we will have to make structural changes to ensure we can stay competitive and deliver for our customers over the long term.”
As Boeing continues to lose money and tries to deal with a strike that is crippling production of the company’s best-selling airline planes, it also announced further delay in the rollout of a new plane, the 777X, to 2026 instead of 2025.
About 33,000 union machinists have been on strike since September 14. Two days of talks this week failed to produce a deal, and Boeing filed an unfair-labor-practices charge against the International Association of Machinists and Aerospace Workers.
Boeing has made two offers for higher wages, both of which have been rebuffed by the union representing hourly factory workers across the west coast.
The jetliner will also stop building the cargo version of its 767 jet in 2027 after finishing current orders.
Ortberg said the company has notified customers that the first deliveries of the plane won’t begin until 2026. He cited the ongoing work stoppage and flight-test pause.
In another disappointing news, Boeing said that it burned through $1.3 billion in cash during the third quarter and lost $9.97 per share.
It has lost more than $25 billion since the start of 2019.
Boeing also expects the Q3 results to include about $5 billion in combined pretax charges at its two main business divisions.
About $2.6 billion of that stems from yet another delay of Boeing’s 777X widebody jet.
