Boeing planning additional job cuts 28,000 by end of 1999, then more in 2000

Aerospace

August 14, 1998|By BLOOMBERG NEWS

SEATTLE -- Boeing Co. said yesterday that it expects to make a new round of job cuts in 2000 on top of the 28,000 planned by the end of next year, as the world's biggest airplane maker strives to restore profitability.

The Seattle-based company also said it will start making some of its updated 737 jetliners in Long Beach, Calif., by the end of the year.

Last month, Boeing said it would cut 18,000 to 28,000 jobs from its total of 238,000. The company is taking steps to cut costs and realign manufacturing. Management is under so much pressure to boost profits that a week ago the company denied speculation that Chief Executive Officer Phil Condit would resign. Boeing said it is making the cuts because it expects to streamline manufacturing processes during the next year.

"It shows that Boeing management is being proactive in attempting to optimize operations and reduce costs," said Peter Jacobs, an analyst at Ragen MacKenzie Inc.

Most of the job reductions will come in California, Washington and Missouri, Boeing said.

The company will close laboratories, plants and other facilities that will reduce its total square footage by 18 percent. In March, it had planned a 15 percent reduction.

Boeing will consolidate its fighter plane production in St. Louis, move the headquarters of its information and communications systems unit to Anaheim, Calif., from Kent, Wash., and vacate all government-owned space in Downey, Calif.

Boeing plans to make three of the updated 737 jetliners a month at a former McDonnell Douglas plant in Long Beach by the second quarter of next year.

McDonnell Douglas was acquired by Boeing last year for $16.3 billion.

Moving production to Long Beach is intended to ease bottlenecks on Boeing's 737 assembly lines in Renton, Wash. Labor and parts shortages emerged last year when the company stepped up production.

Boeing shares fell $1.6875 to $37.1875 yesterday.

Pub Date: 8/14/98

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.