CEO Kelly Ortberg announced the job cuts in a message to employees as part of a broader restructuring effort aimed at aligning Boeing’s operations with its financial challenges.
"We reset our workforce levels to align with our financial reality and to a more focused set of priorities. Over the coming months, we are planning to reduce the size of our total workforce by roughly 10%. These reductions will include executives, managers and employees," Ortberg's message read as per a Reuters report.
The planemaker, already facing hurdles from regulatory issues and a strike-induced production halt, has also pushed back the first deliveries of its 777X jet by a year, now expected in 2026.
In addition to downsizing, Boeing is considering measures to raise billions of dollars in funding, including selling stock and equity-like securities, to safeguard its financial standing. Analysts estimate the company may need to secure $10 to $15 billion to maintain its credit ratings, which are perilously close to junk status.
Boeing has taken legal steps against the International Association of Machinists and Aerospace Workers (IAM), accusing the union of failing to negotiate in good faith. However, IAM has criticised Boeing’s claims as an attempt to deflect from its refusal to return to the bargaining table.
The strikes are costing Boeing roughly $1 billion a month, and analysts believe resolving the labour dispute is critical for the company’s future. With significant financial losses looming and a court case involving fraud charges ahead, Boeing’s challenges continue to mount as it faces increasing pressure from both regulatory bodies and its workforce.
(With Reuters inputs)