Boeing cuts 17,000 jobs and sinks into existential crisis

Boeing’s new CEO Kelly Ortberg dropped a bombshell on Friday, October 11, announcing that 17,000 jobs would be cut, amid third-quarter losses of over $6 billion, and that 777X deliveries would be postponed to early 2026. The outlook keeps getting worse for a company that is bogged down in an interminable strike and threatened with downgrading by credit rating agencies.

“Our business is in a difficult position, and it is hard to overstate the challenges we face together. Beyond navigating our current environment, restoring our company requires tough decisions and we will have to make structural changes,” Ortberg wrote to his employees, announcing clear cuts in the workforce. “We must (…) 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 percent,” he said. The company employs around 170,000 people worldwide.

Ortberg also announced a $5 billion provision, covering both civil aviation ($3 billion) and defense ($2 billion). Net loss per share reached $9.97, making a loss of around $6.1 billion for the third quarter.

Finally, the CEO warned of further delays in the 777X program, the first deliveries of which will not take place until early 2026. The aircraft is still not certified and is about 10 years behind schedule. The company will also cease production of its 767 freighter in 2027.

Order collapse

These announcements come against the backdrop of a workers’ strike in the company’s historic base of Seattle, Washington. The strike began on September 13, when employees refused to accept an agreement negotiated by their union with management. The work stoppage brought the production lines for the 737 Max, 767 and 777 aircraft to a standstill. Since then, thousands of employees have been furloughed, while the aircraft manufacturer’s subcontractors, suppliers and service providers are struggling to survive the collapse in orders.

Boeing had hardened its tone on Tuesday, October 8, withdrawing an offer of a 30% pay rise over four years. “Further negotiations do not make sense at this point,” Boeing Commercial Airplanes head Stephanie Pope said in a note to employees, calling the demands of the union, which represents 33,000 West Coast employees, “non-negotiable.” On Thursday, management took the employee rights organization to the National Labor Relation Board (NLRB), the federal agency that handles labor disputes, claiming that the union was “bargaining in bad faith.”

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