Spirit AeroSystems sends 700 employees on mandatory leave due to ongoing Boeing strike

10/20/2024, 1:12 PM

Due to the ongoing strike at Boeing, Spirit AeroSystems is placing 700 employees on furlough and warns of further measures should the labor dispute continue.

Eulerpool News Oct 20, 2024, 1:12 PM

The aircraft supplier Spirit AeroSystems will furlough around 700 employees due to the ongoing machinists' strike at Boeing impacting production. The affected employees work on the Boeing programs 767 and 777, the company announced on Friday. The furlough is expected to last three weeks.

This difficult step was necessary due to our limited storage capacity for 767 and 777 units," explained CEO Pat Shanahan. To secure liquidity, Spirit AeroSystems has also implemented a hiring freeze and introduced travel and overtime restrictions.

If the Boeing strike continues beyond November, further layoffs and an extension of mandatory leave are threatened, the company warned.

Boeing itself announced last week that it will cut 10 percent of its global workforce—about 17,000 jobs—and is once again delaying the launch of the new 777X aircraft, which is already years behind schedule. CEO Kelly Ortberg, who took office in August, had already sent thousands of employees on furlough and imposed a hiring freeze to maintain liquidity due to the strike.

Before the start of the strike, Boeing was burning through about $1 billion in cash monthly due to production and quality problems. To tackle these challenges, the company, under then-CEO David Calhoun, agreed in July to acquire Spirit AeroSystems in an all-stock transaction valued at approximately $4.7 billion. With this move, Boeing aims to reintegrate the outsourced fuselage manufacturer into the company to improve manufacturing safety and quality.

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