Airplane fuselages sure for Boeing’s 737 Max production facility await shipment on rail sidings at their top supplier, Spirit AeroSystems Holdings Inc., in Wichita, Kansas, on Dec. 17, 2019.
Nick Oxford | Reuters
Boeing supplier Spirit AeroSystems will furlough some 700 staff as a strike by machinists on the plane maker enters its sixth week, a spokesman for the supplier said Friday.
Greater than 32,000 Boeing staff walked off the job Sept. 13 after overwhelmingly rejecting a tentative labor take care of Boeing, deepening the aircraft producer’s financial strain and handing a latest challenge to CEO Kelly Ortberg, who took the reins just over two months ago.
The temporary furloughs account for about 5% of Spirit’s U.S. workforce, in accordance with its latest annual filing.
The temporary furloughs will affect employees at Spirit’s largest facilities, in Wichita, Kansas, and account for about 5% of Spirit’s U.S. workforce, in accordance with its latest annual filing. Meanwhile, Boeing and its machinists’ union remain at an impasse, and Spirit is considering deeper cuts.
“If the strike continues beyond November, we could have to implement layoffs and extra furloughs,” Spirit spokesman Joe Buccino told CNBC on Friday.
Ortberg, who faces investors in his first earnings call next Wednesday, last week announced a series of drastic measures meant to slash costs as the corporate’s losses mount, including cutting the workforce by 10%, or about 17,000 people. Boeing can be ending 767 business production when orders are fulfilled in 2027 and said its long-delayed 777X wide-body jet won’t debut until 2026, pushing it back one more 12 months.
Boeing is within the strategy of raising debt or equity to extend liquidity.
The roughly 700 Spirit staff affected by the 21-day furlough are assigned to the 777 and 767 programs for Boeing, for which Spirit has built up “significant inventory,” Buccino said. Spirit staff on Boeing’s bestselling 737 Max usually are not affected, he added. Work on all three programs, nonetheless, is stalled due to the strike.
Boeing agreed to amass Spirit this summer, but the businesses don’t expect the deal to shut until mid-2025. Reuters earlier reported Spirit’s latest furloughs.
