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Boeing to offer voluntary layoffs to employees to tide over coronavirus fallout

Published 2020-04-02, 12:25 a/m
© Reuters. Outbreak of the coronavirus disease (COVID-19) in Everett
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By Eric M. Johnson and Shubham Kalia

SEATTLE (Reuters) - Boeing Co (N:BA) Chief Executive Officer Dave Calhoun outlined a plan of voluntary layoffs for employees on Thursday, while warning that the coronavirus pandemic would have a lasting impact on the global aerospace industry.

Under the plan, eligible employees who want to exit the company will be offered pay and benefits package, Calhoun said in a memo.

"We're in uncharted waters. We're taking actions based on what we know today," Calhoun said.

"We're also doing everything we can ... That means continuing to deliver for our commercial and services customers, even as their own businesses slow to a trickle."

Shares of the company were up about 3% in trading before the bell.

Reuters reported on Wednesday that an announcement on early retirement and buyout packages could come as early as Thursday.

Boeing, which calls itself America's largest exporter, has some 150,000 employees worldwide, nearly half of whom are clustered around marquee factories in Seattle's Puget Sound region.

The buyout plan comes three weeks after the U.S. planemaker said it would freeze hiring and overtime pay except in certain critical areas to preserve cash.

The coronavirus pandemic has compounded the year-old crisis over the grounding of Boeing's 737 MAX following fatal crashes that killed 346 people in a five-month span.

Boeing halted 737 production in January.

Last week Boeing halted operations at its twin-aisle factory and other facilities around Seattle after more than a dozen employees were infected - at least one fatally - by the virus that causes COVID-19.

"It will take time for the aerospace industry to recover from the crisis," Calhoun said.

© Reuters. Outbreak of the coronavirus disease (COVID-19) in Everett

Boeing has called for a $60 billion bailout package, including loan guarantees, for the struggling U.S. aerospace manufacturing industry.

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