Boeing's Mass Layoffs: How a $5 Billion Loss and Strike Led to 17,000 Job Cuts

Boeing Layoffs: Troubles continue to mount for the US-based aviation firm, as the company recently announced another set of layoffs. While previous cuts were limited to temporary furloughs and a hiring freeze, Boeing is now planning to cut nearly 17,000 jobs. This roughly translates to 10 per cent of its global workforce, as per multiple reports.

In a message to employees, CEO Kelly Ortberg reportedly stated that the massive downsizing is necessary for the company "to align with our (its) financial reality." This decision comes in the wake of a strike by 33,000 US West Coast workers that has halted the production multiple carriers, including 737 MAX, 767 and 777 jets.

"We reset our workforce levels to align with our financial reality and to a more focused set of priorities. Over the coming months, we are planning to reduce the size of our total workforce by roughly 10 per cent. These reductions will include executives, managers and employees," Ortberg's message said.

On a year-to-date basis, the shares of the aviation company have declined by over 40 per cent on the New York Stock Exchange.

Meanwhile, financial pressures are still weighing on the airlines. Analysts are expecting Boeing to report a quarterly cash burn of around negative $3.8 billion, according to LSEG (London Stock Exchange) data.

Why is Boeing switching to layoffs?

Apparently, this isn't the first time the troubled airline has taken such a move. Just last month, the company had announced temporary furloughs alongside a hiring freeze. According to the airlines, this was done as a part of cost-cutting measures because of a prolonged and costly strike by workers.

On top of that, Boeing has been grappling with multiple challenges for a while now.

Recently, the company announced a one-year delay in the delivery of its 777X jet. It also reported a $5 billion loss in the third quarter largely owing to the month-long strike.

All these issues come at a time when the company just got its new CEO who promised to improve the company's internal relations. For now, no road seems to go well for the aviation company.

As for the third-quarter earnings, the company has already said in a separate release that it expects a revenue of $17.8 billion with a loss per share of $9.97.