Welcome to Extreme Investor Network, where we bring you the latest and most insightful business news. Today, we’re diving into the impact of the ongoing strike at Boeing on one of its major suppliers, Spirit AeroSystems.
As the strike by machinists at Boeing enters its sixth week, Spirit AeroSystems has announced that they will be furloughing around 700 workers. This decision comes as a response to the deepening financial strain on Boeing and the impasse between the plane maker and its machinists’ union.
The temporary furloughs will affect employees at Spirit’s main facilities in Wichita, Kansas, accounting for about 5% of their U.S. workforce. However, if the strike continues beyond November, deeper cuts including layoffs may be implemented.
CEO Kelly Ortberg, who took the reins just over two months ago, is facing a challenging situation as he prepares for his first earnings call next Wednesday. In an effort to slash costs, Boeing has announced plans to cut its workforce by 10% and cease 767 commercial production by 2027. Additionally, the debut of the long-delayed 777X wide-body jet has been pushed back to 2026.
The impact of the strike is also being felt by Spirit workers assigned to Boeing’s 777 and 767 programs, where significant inventory has been built up. Despite the challenges, work on Boeing’s 737 Max program, which Spirit is also involved in, remains unaffected by the furloughs.
It’s worth noting that Boeing agreed to acquire Spirit earlier this summer, but the deal is not expected to close until mid-2025. As the situation continues to evolve, we will keep you updated on the latest developments in the aviation industry.
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