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Boeing Layoffs Hundreds of Staffs amid Stalled Strike Resolution

Boeing announced that production of its best-selling 737 MAX and other models has been suspended due to the strike action, and the company has temporarily placed tens of thousands of employees on leave。

Boeing Layoffs Hundreds of Staffs amid Stalled Strike Resolution

Boeing announced that it has temporarily arranged for tens of thousands of employees to take leave because of the strike, suspending production of its best-selling 737 MAX and other models.

CEO Kelly Ortberg said in an internal email: "We will temporarily take leave in the next few days, affecting a large number of domestic employees in the United States." During the strike, the company will let some employees take one week off every four weeks.

Boeing has experienced a turbulent year, and this is the first strike at the company since 2008. In January this year, a door panel of a new 737 MAX aircraft fell off during flight. Ortberg also said that he and other management will "accept corresponding pay cuts during the strike."

Boeing and the International Association of Machinists and Aerospace Workers held two days of negotiations under the auspices of a federal mediator. The union was disappointed with the first mediation and said that subsequent meetings did not make "substantial progress."

The union said: "We are open to further discussions, but no additional meeting dates have been set at this time, and we are 100% committed to fighting for the contract that our members deserve."

Analysts pointed out that the furlough measures indicate that Ortberg is preparing for a long-term strike, which is unlikely to be easily resolved given the anger of grassroots workers. A long-term labor dispute could cost Boeing billions of dollars, further squeeze its financial situation and endanger its credit rating.

Ben Sokanos, head of aviation at S&P Global Ratings, said: "The layoffs are unlikely to fully offset the costs of a long-term strike."

In the first full contract negotiations with Boeing, the union demanded a 40% pay increase over four years, far higher than the 25% proposed by Boeing, and was clearly rejected. Brian Bryant, global president of the International Association of Machinists and Aerospace Workers, said that furloughs and wage cuts are nothing more than "smoke bombs" considering the company's spending on incentives and CEO pay.

"It's just a way for them to look like they're trying to save money," he said. "The ball is in Boeing's court right now. They can resolve this strike tomorrow by providing fair wages, pensions, recovery bonuses and health insurance," Bryant said as he demonstrated with "resilient" members in Seattle.

In a communication with employees, Ortberg said the company would not take any action that would prevent our full recovery in the future, and all work related to safety, quality, customer service and necessary certification processes (including 787 production) would be prioritized and continued.

Boeing employs about 150,000 people in the United States, and it is not clear which employees will be affected by the furloughs. The union representing Boeing engineers said its members were not affected.

The strike, which has lasted for six days, also puts the company's vast supply chain at risk, and some suppliers are considering implementing furloughs.

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