Boeing cutting more than 12,000 jobs with layoffs, buyouts

EVERETT — Nearly 10,000 Boeing workers in Washington will be out of a job in coming weeks as the result of layoffs and buyouts.

The Boeing Co. is cutting more than 12,000 jobs in the U.S. due to a sharp decline in air travel during the coronavirus pandemic, the company said Wednesday.

Boeing said it will notify 6,770 U.S. employees this week that they will be laid off. For most, their last day will be July 31. Another 5,520 U.S. workers are taking buyouts and will leave voluntarily in coming weeks. About 9,840 employees in Washington are included in the total, the Chicago-based company said.

Boeing previously said it would cut 10% of a global workforce that numbered about 160,000. A Boeing spokesperson said Wednesday’s actions represent the largest number of job cuts, but several thousand additional jobs will be eliminated in the next few months.

Boeing currently employs about 70,000 in Washington. About half of those workers, nearly 35,000, are employed in three shifts at Boeing’s main wide-body assembly plant in Everett.

Boeing declined to say how many workers at the Everett campus would be affected. “We are not sharing that level of detail — just the statewide total,” Boeing spokeswoman Jessica Kowal told The Daily Herald.

Meanwhile, a few hours after the layoff announcement, Boeing said it has resumed production of the grounded 737 Max at the Renton factory.

The company said production would proceed at a “low rate” but did not specify what that rate might be. When it suspended production of the troubled 737 Max in January, the Renton assembly line was building 42 planes a month.

The 737 announcement was preceded and overshadowed by release of a memo sent Wednesday to employees in which Boeing President and CEO David Calhoun said the company had concluded a voluntary layoff program initiated earlier this year.

“And now we have come to the unfortunate moment of having to start involuntary layoffs,” Calhoun said. “We’re notifying the first 6,770 of our U.S. team members this week that they will be affected. We will provide all the support we can to those of you impacted by the involuntary layoffs — including severance pay, COBRA health care coverage for U.S. employees and career transition services.”

Calhoun said Boeing’s international locations have also begun the process of laying off workers.

The pandemic has cut global air traffic by up to 90% and caused airlines to postpone or cancel orders and deliveries of new planes. Air travel within the U.S. tumbled 96% by mid-April, to fewer than 100,000 people on some days. It has recovered slightly. The Transportation Security Administration said it screened 264,843 people at airports on Tuesday, a drop of 89% compared with the same Tuesday a year ago.

“The COVID-19 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,” Calhoun wrote. “We have done our very best to project the needs of our commercial airline customers over the next several years as they begin their path to recovery. I wish there were some other way.”

Calhoun warned that Boeing will have to adjust business plans constantly because the pandemic makes it hard to predict the impact on the company. Boeing faces the challenges of keeping employees safe and working with suppliers and airlines “to assure the traveling public that it can fly safe from infection,” he said.

The company temporarily shuttered jet-assembly plants in March after dozens of workers contracted the virus, and one died. Boeing’s deliveries of commercial airplanes have plummeted by two-thirds this year compared to a year ago. Production resumed in late April, but at a slow pace.

Union representatives said they were still seeking details of the layoffs. About 1,300 members of the Society of Professional Engineering Employees in Aerospace, which represents Boeing engineers, had been approved for severance packages, including one week of pay for every year of employment, up to 26, according to the union.

“This is an extremely tough time for anyone working in aerospace, and certainly at Boeing,” said Bill Dugovich, a union spokesman. The union has been running webinars to explain Boeing’s severance program and how to apply for unemployment, he said.

“It will take some time for the company to reduce our workforce by the approximately 10% we announced, but today’s numbers represent the largest segment of layoffs. The several thousand remaining layoffs will come in additional tranches over the next few months,” a company spokesperson said.

The defense and space division of Boeing is stable and will help blunt the impact, the company said.

Boeing’s crisis began with two crashes of the 737 Max, which led regulators around the world to ground the jetliner last year. The company’s problems have deepened with the coronavirus pandemic.

“We’ve been on a continuous journey to evolve our production system and make it even stronger,” said Walt Odisho, vice president and general manager of the 737 program. “These initiatives are the next step in creating the optimal build environment for the 737 Max.”

By The Associated Press and Herald writer Janice Podsada; jpodsada@heraldnet.com; 425-339-3097; Twitter: @JanicePods