Pressured by a prolonged commercial travel downturn and the hit from the 737 MAX crisis, Boeing on Wednesday announced an additional 7,000 job cuts that will lower headcount by 30,000 positions over two years.
The planemaker, which has been in belt-tightening mode throughout 2020 in the wake of the coronavirus on top of the 737 MAX’s protracted grounding, reported another quarterly loss and said it will shrink headcount down to 130,000 at the end of 2021 from 160,000 in January, a drop of nearly 19 percent in less than two years.
“The global pandemic continued to add pressure to our business this quarter, and we’re aligning to this new reality by closely managing our liquidity and transforming our enterprise to be sharper, more resilient and more sustainable for the long term,” said chief executive Dave Calhoun.
A steep drop in commercial plane travel has prompted airlines to cancel plane orders or defer deliveries, crimping Boeing’s revenues.
On top of that, the company’s finances have been under pressure due to the grounding since March 2019 of the Boeing 737 MAX, which is nearing regulatory approval to resume service after a lengthy oversight process by air travel authorities.
In the third quarter, Boeing reported a loss of $449 million, compared with profits of $1.2 billion in the year-ago period, as revenues fell 29.2 percent to $14.1 billion. The latest quarter of red ink takes Boeing’s losses for all of 2020 to $3.5 billion.—APP