Boeing warns of possible layoffs in 2009
Boeing transactions warned workers Thursday that employment will fall in 2009 and that layoffs are possible, an ominous sign that even the previously booming aerospace sector is staggering from the worldwide economic downturn.
A memo from Boeing’s Executive Council said the company next year anticipates lower military expenditure and a potential global recession in the airline industry.
“We mould be agreeable to aggressively to these affair realities,” Boeing Chairman and Chief Executive Jim McNerney wrote in the memo.
The memo said that “while no firm estimate has been made, the employment decline could exceed Boeing’s mean proportion annual wearing away rate of 4 to 5 percent and volition be composed of a mix of normal rubbing away, hiring freezes and layoffs.”
That seems like little other thing than initial belt-tightening, compared with many other industries.
But top aerospace analyst Richard Aboulafia of the Teal Group said a more substantial Boeing downturn is clearly on the way.
A be congealed in the credit markets and falling passenger numbers have crimped airlines’ buying power, and the most ambitious jet buyers — Middle Eastern carriers — have been undercut by the plunging estimation of oil.
Teal Group’s most optimistic scenario forecasts production dropping from 2010 on, falling in all parts of 15 percent by 2013. A ramp-up of the repaired 787 Dreamliner would cushion the total production decline from acquirement any worse.
Worst-case scenario
In the worst-case scenario, conceited the honor freeze doesn’t thaw, Aboulafia predicts a production drop and layoffs likely for example early as next fall. In that case, the situation could worsen rapidly and the sediments is unpredictable.
The economic downturn has hit with massive force across industries from monetary theory and homebuilding to automobiles and unfinished materials. But despite a series of lengthening delays and a two-month Machinists strike, until now Boeing’s business appeared rock-solid.
In the first quarter of this year, Boeing’s commercial division raked in not quite $1 billion in service on revenues of more than $8 billion.
