Peter McNally, head of global analyst at Third Bridge, spoke on “The Big Money Show” about how the Boeing factory workers' strike is impacting business.
Spirit AeroSystems on Friday announced it will furlough 700 employees for 21 days, as U.S. aircraft maker Boeing Co.'s more than month-long strike strains the company's cash and inventory space, a spokeswoman said. told Reuters.
The furloughs affect Spirit Aero employees who work on Boeing's 767 and 777 widebody programs. Production of these jets has been halted since September 13 during a strike by more than 33,000 factory workers on the U.S. West Coast.
The furloughs follow other cost-cutting efforts at Spirit, including hiring freezes and limits on business travel and overtime.
Boeing strike: Which aircraft are affected?
“These furloughs are necessary due to a lack of storage space for our 767 and 777 aircraft,” spokesman Joe Buccino said in a statement.
Boeing's suppliers, which have invested heavily in materials and tools to support the plane maker's planned jet fleet expansion, have furloughed employees and slowed investments in recent weeks as a result of the strikes. I try to refrain from it.
A Spirit Aerosystems Holdings sign on the fuselage of a Boeing 737 aircraft outside the Boeing Manufacturing Facility in Renton, Washington, U.S., Monday, February 5, 2024. (Photographer: David Ryder/Bloomberg via Getty Images / Getty Images)
Buccino said Wichita, Kan.-based Spirit Aero also warned it would have to lay off workers and announce additional furloughs if the strike continues beyond November.
Boeing declined to comment.
| ticker | safety | last | change | change % |
|---|---|---|---|---|
| SPR | spirit aero system | 32.21 | +0.10 |
+0.31% |
| BA | boeing company | 155.31 | +0.41 |
+0.26% |
Boeing and its supply chain have weathered a series of crises over the past six years, including the grounding of the 737 MAX due to two fatal crashes, a global pandemic and a quality crisis since the door plug eruption in January.
Boeing plans to raise up to $35 billion to shore up finances as strikes continue
Spirit Aero's second-quarter loss more than doubled. The airline reduced production of 737 MAX aircraft from 31 to 21 per month in August, September and October, and further cuts may be necessary, according to one industry person familiar with the matter. It is said that there is a sex. Boeing is in regular contact with Spirit Aero about its financial situation, another person said.
Spirit also has already fully drawn down a $350 million bridging loan facility set up when Boeing agreed to acquire its former supplier, and is expected to seek additional support from the aircraft maker, the sources said. said the person.
Spirit Aerosystems Holdings headquarters in Wichita, Kansas, USA, December 17, 2019. (Reuters/Nick Oxford/Reuters Photo)
Spirit declined to comment on the loan facility or production numbers.
Boeing cuts 10% of its workforce, halts most 767 production amid union turmoil
Boeing has been inspecting new planes at Spirit's Kansas plant since March, but third-party industry sources said the inspections are taking longer than expected. The delay had already delayed the delivery of 737 MAX aircraft from Spirit to Boeing's Renton, Wash., factory.
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Delays and strikes have made it unlikely that Boeing will reach its goal of producing 38 MAX jets a month by the end of 2024, up from 25 a month in July.
Buccino said that during the strike, Spirit Aero increased inspections of 737 MAX planes at its factories so that more planes would be ready once the outage ends.
