Boeing is freezing hiring and weighing temporary furloughs to cut costs as a strike by more than 30,000 workers entered its fifth day on Tuesday.
The plane maker and union leadership badly misjudged anger among union members who backed a strike with 96% support last week, stopping production of its 737 series just as Boeing was trying to speed up assembly lines. Now executives need to find a way to contain the work stoppage with a fresh offer in talks, which resume Tuesday.
“This strike jeopardizes our recovery in a significant way and we must take necessary actions to preserve cash and safeguard our shared future,” CFO Brian West told employees in a letter Monday.
Boeing will stop issuing the majority of supplier purchase orders on the 737, 767 and 777 programs affected by the stoppage, West wrote, adding, “I know that these actions will create some uncertainty and concern.”
West last week said that the first priority was preserving Boeing’s credit rating, which is hovering one notch above junk.
The decision to stop placing most orders for parts for all Boeing jetliner programs except the 787 Dreamliner is exceptionally rare and will send shockwaves through an industry still struggling to rebuild from the bottom up after COVID-19.
Some executives immediately warned of a vicious cycle of departures just as the industry is battling competition from other sectors to attract new aerospace workers and engineers.
