In his address to the employees, the CEO and President of Boeing, Kelly Ortberg, stated that the business is in a difficult position and that overcoming the challenges is becoming more and more difficult.
“We need to be clear-eyed about the work we face and realistic about the time it will take to achieve key milestones on the path to recovery. We also need to focus our resources on performing and innovating in the areas that are core to who we are, rather than spreading ourselves across too many efforts that can often result in underperformance and underinvestment,” Ortberg said.
On this occasion, he announced that the company was forced to make three difficult decisions. The first is that the first delivery of the Boeing 777X is expected in 2026, the second is that the production program for the cargo versions of the Boeing 767 is being terminated in 2027. The last is also a consequence of the first two, namely that the number of employees will need to be reduced by an estimated 17,000 workers, which is 10% of the total number of Boeing employees. He stressed that new orders for the 767F are not being accepted, but that the company will focus on delivering the aircraft already on order. Nevertheless, the production of KC-46A tankers is not interrupted.
“As we move through this process, we will maintain our steadfast focus on safety, quality and delivering for our customers. We know these decisions will cause difficulty for you, your families, and our team, and I sincerely wish we could avoid taking them. However, the state of our business and our future recovery require tough actions. We will be transparent with you regarding the timing and impact of these steps, and we will be professional and supportive to everyone along the way. Thank you for all that you are doing through this very challenging time at Boeing. We will navigate through this moment. We will re-focus our company, and we will restore trust with all those who depend on us,” Ortberg concluded.
Boeing has been facing significant challenges for months, if not years, as evidenced by its financial indicators and the company’s rapidly declining reputation since the first 737 MAX crash in 2019. Furthermore, the 777X program continues to face ongoing difficulties, raising questions about how long the first customers will remain patient with the delayed deliveries. In light of this, the recent announcement of the 797 program seems more like a distant fantasy, perhaps intended to placate frustrated employees.
Although the news about the layoff of 17,000 employees resonated very loudly, this time the management will not only lay off employees from production, but Ortberg promised that the layoffs will include everyone, from executive management positions to employees performing auxiliary tasks.
