Boeing said on Monday it will cut about 5 percent of its commercial plane workforce as the company slows its pace of increasing jet production. The company said it will eliminate the positions through a combination of layoffs and attrition. Boeing commercial chief Stephanie Pope said in a message to employees that the reduction was necessary to 'provide our factories and supply chain partners additional time to achieve stability'. She added that adjusting production schedules and reducing aircraft output had left the company in an overstaffed position.
Pope acknowledged progress made by the team, citing US certifications this year of the 737 Max 7 and 737 Max 10 as evidence of improved operations. However, she noted that the company had 'not yet fully recovered'. Boeing said layoff notifications will begin in December and promised to treat employees with 'dignity and respect' throughout the process.
The workforce reduction follows Boeing's earlier signal of slower production plans. In a late October conference call, executives said the company would no longer meet its target for 2026 deliveries. Boeing also pushed back the timeframe for lifting 737 Max production to 52 aircraft per month from 47 until the second half of 2027. CEO Kelly Ortberg said in October that achieving full stability at the current production rate would likely take into 2025, citing the need for greater predictability in wing production and in fuselage production at its Kansas operation.
Raising 737 Max output has been considered critical by investors for driving revenue and profit growth after the company faced prolonged financial losses stemming from safety problems. Two deadly 737 Max crashes occurred in 2018 and 2019. The slowdown in production plans represents a shift from the aggressive expansion Boeing had previously pursued to recover from those incidents and their aftermath.