Boeing Co. announces plans to cut 20,000 to 30,000 jobs by the end of 2002
Wednesday, September 19th 2001, 12:00 am
By: News On 6
SEATTLE (AP) _ Reacting to commercial airlines that are cutting workers and eliminating routes, Boeing Co. announced plans to lay off up to 30,000 commercial airplane employees by the end of next year.
The decision, announced late Tuesday by the aerospace giant, comes amid expectations that orders for commercial aircraft will drop in the aftermath of last week's terrorist attacks.
``We profoundly regret that these actions will impact the lives of so many of our highly valued employees,'' Alan Mulally, president and chief executive officer of Boeing Commercial Airplanes, said in a statement. ``It is critical that we take these necessary steps now ... to support the difficult and uncertain environment faced by our airline customers.''
The company will likely start handing out pink slips within three weeks, with layoffs to begin about two months later, he said. The layoffs, expected to be between 20,000 and 30,000, will be made across the board, he said.
Roughly 93,000 people work for Boeing's commercial airline sector, much of which is centered on the company's former headquarters in Seattle. Boeing's corporate headquarters is now in Chicago.
``We're going to do everything we can to help the workers get back on their feet,'' Washington Gov. Gary Locke said.
Major airlines have announced more than 26,000 layoffs and say that figure could reach 100,000 in the coming weeks as a result of the grounding of flights following the Sept. 11 attacks and prospects for seriously reduced business in the coming months. American, Continental, Delta, Northwest and United have scaled back schedules by 20 percent in an effort to remain solvent.
The White House and Congress are considering a federal aid package for the airline industry to help them recover from last week's attacks.
With such declines, analysts have said layoffs at Boeing may be an inevitable side effect as orders for commercial aircraft are certainly expected to drop.
``It looks like there are more innocent victims of the terrorist bombing,'' said Charles Bofferding, executive director of SPEEA, Boeing's white collar engineering union.
But Bofferding said he was still holding out hope the industry would recover somewhat and the actual layoffs would not be as drastic.
``I believe this has got to be a worst-case scenario,'' he said.
The layoffs would be among the worst in Boeing's history.
About 30,000 Boeing workers lost their jobs when World War II ended in 1945. In 1971, a recession, high costs on the new 747 jumbo jet and cancellation of the planned supersonic transport caused the ``Boeing Depression'': the company cut its employment in the Puget Sound area from 80,400 to 37,200 in two years, prompting the famous billboard that read, ``Will the last person leaving Seattle turn out the lights.''
Since U.S. markets reopened this week, Boeing's stock has plunged. On Monday, the first regular day of trading since the attacks, the stock price fell 13 percent. The price was down $2.66, or 7.4 percent, to $33.14, when trading closed Tuesday.