Boeing Cuts 12,000 U.S. Jobs Amid Coronavirus Pandemic

Boeing announced Wednesday that it is cutting at least 12,000 U.S. jobs, including 6,770 workers who must take involuntary layoffs. The planemaker would not rule out the potential for more layoffs in the coming months, saying it has plans for “several thousand remaining layoffs.” It did say, however, that this is the largest wave of cuts it anticipates making in the U.S.

The company plans to cut 10% of its worldwide workforce by the end of 2020. The manufacturer currently has about 160,000 employees, Reuters reports.

“[The Coronavirus pandemic’s] devastating impact on the airline industry means a deep cut in the number of commercial jets and services our customers will need over the next few years, which in turn means fewer jobs on our lines and in our offices,” Boeing CEO Dave Calhoun told employees. “I wish there were some other way.”

“For those of you who are notified, I want to offer my personal gratitude for the contributions you have made to Boeing, and I wish you and your families the very best,” Calhoun added.

Calhoun said in a statement that affected employees will receive severance pay, COBRA health care coverage and career transition services.

Boeing has previously implemented a voluntary layoff, or buyout, program. Roughly 5,520 employees were approved for buyouts, per a company spokesperson.

Boeing’s layoffs will likely be centered in Seattle, the center of Boeing’s commercial aviation manufacturing.

Boeing says that workplaces outside the U.S. will also see job cuts. It says that it will have to constantly adjust its business plans because the uncertain nature of the Coronavirus makes sticking to one plan difficult.

April was the second month this year in which Boeing recorded zero orders, which means that its revenue is plummeting. The manufacturer says it needs to cut costs in as many ways as possible as the worldwide aviation industry struggles to recover from the Coronavirus outbreak. An increasing number of orders are being canceled or deferred, further reducing Boeing’s revenue.

Boeing says that its defense and space division is stable and will help blunt the impact that declining commercial traffic has on its operations.

Calhoun has pointed out that there are “some green shoots” in the aviation industry.

“Some of our customers are reporting that reservations are outpacing cancellations on their flights for the first time since the pandemic started. Some countries and U.S. states are starting cautiously to open their economies again,” Calhoun said. “But these signs of eventual recovery do not mean the global health and economic crisis is over. Our industry will come back, but it will take some years to return to what it was just two months ago.”

At its lowest levels, U.S. air travel bottomed out at a measly 4 percent of previous years’ demand. On Tuesday, TSA reported that it screened 264,843 passengers, which is about 11 percent of passenger volume on the same day last year.

Boeing is continuing to move its 737 MAX jet towards recertification in the U.S. Last month, it said it may be able to certify the jet in August, allowing deliveries to resume in Q3 should customers opt to take the jets. The manufacturer plans to restart production of the jet at low levels in Q2 and increasing to at least 31 planes made per month in 2021.