In a memo to employees, CEO Kelly Ortberg noted that the reductions will include executives, managers and employees, warning that:

“Our business is in a difficult position, and it is hard to overstate the challenges we face together.”

Boeing ended 2023 with 171,000 employees.

The company said it expects to report third quarter revenue of $17.8 billion, and a loss per share of $9.97, according to preliminary figures.

The company unveiled the measures and the earnings figures as it seeks to get its negotiations with labor unions back on track.

Boeing has made two offers for higher wages, both of which were turned down by workers.

About 33,000 employees at its main Seattle-area facilities have been on strike for a month now, devastating production and draining Boeing’s reserves.

The latest talks collapsed earlier this week, with no clear path when and how they might resume.

Boeing shares tumbled after hours, erasing the day’s gains…

Ortberg also said the company has notified customers that the first deliveries of the 777X are now expected in 2026, citing the ongoing work stoppage and flight test pause.

Read the full press release below:

“While our business is facing near-term challenges, we are making important strategic decisions for our future and have a clear view on the work we must do to restore our company,” said Kelly Ortberg, Boeing president and chief executive officer.

“These decisive actions, along with key structural changes to our business, are necessary to remain competitive over the long term. We are also focusing on areas that are critical to our future and will ensure we have the balance sheet necessary to invest, support our people and deliver for our customers.”

Commercial Airplanes expects to recognize pre-tax earnings charges of $3.0 billion on the 777X and 767 programs. The company now anticipates first delivery of the 777-9 in 2026 and the 777-8 freighter in 2028, resulting in a pre-tax earnings charge of $2.6 billion. This schedule and resulting financial impact are based on an updated assessment of the certification timelines to address the delays in flight testing of the 777-9, as well as anticipated delays associated with the IAM work stoppage. Commercial Airplanes also plans to conclude production of the 767 freighter and recognize a $0.4 billion pre-tax charge on the program, which also reflects impacts from the IAM work stoppage. Beginning in 2027, the company will solely produce 767-2C aircraft in support of the KC-46A Tanker program. Commercial Airplanes expects to report third quarter revenue of $7.4 billion and operating margin of (54.0) percent.

Defense, Space & Security expects to recognize pre-tax earnings charges of $2.0 billion on the T-7A, KC-46A, Commercial Crew, and MQ-25 programs. The T-7A program pre-tax charge of $0.9 billion was driven by higher estimated costs on production contracts in 2026 and beyond. The KC-46A program pre-tax charge of $0.7 billion reflects the decision to conclude production on the 767 freighter and impacts of the IAM work stoppage. Results also include unfavorable performance on other programs. Defense, Space & Security expects to report third quarter revenue $5.5 billion and operating margin of (43.1) percent.

Finally, a quick thought for all the other corporations out there…

*BOEING PRELIM 3Q REV. $17.8B, EST. $18.58B
*BOEING EXPECTS TO RECOGNIZE ABOUT $5 BILLION EARNINGS CHARGES

going woke was not such a great idea https://t.co/rF33WdGSgz pic.twitter.com/cwmw6izvsH

— zerohedge (@zerohedge) October 11, 2024

Live by the capitalist sword, DEI by the socialist sword…

The U.S. National Transportation Safety Board (NTSB)’s chairwoman, Jennifer Homendy, said that 271 impacted parts could be installed on aircraft in service operated by at least 40 foreign air carriers. Sixteen of the impacted parts may still be installed on U.S.-registered aircraft and up to 75 such parts may have been used in aftermarket installation, she wrote in a Sept. 30 letter to the Federal Aviation Administration (FAA).

On Sept. 27, the NTSB issued an “urgent” safety warning for some Boeing 737s, including the Max variant, because there is a “potential for a jammed or restricted rudder control system on some 737 airplanes.” The rudder that the NTSB is referencing controls a plane’s side to side movement of the nose of the aircraft.

Homendy’s Monday letter, making reference to last week’s warning, said that her agency is concerned “of the possibility that other airlines are unaware of the presence of these actuators on their 737 airplanes.” Her letter did not identify the foreign airlines or the countries where they operate.

Concerns Over FAA

The NTSB director further wrote that she believes the “FAA has been downplaying the urgency of this issue, maintaining that the units are no longer in service,” without elaborating.

“I remain concerned that the FAA, as a whole, did not take this issue more seriously until we issued our urgent safety recommendation report, despite the risk of loss of control of an aircraft or departure from the runway occurring due to a jammed or restricted rudder control system, caused by a defect in certain rollout guidance actuators,” the letter stated.

The FAA, Homnedy added, apparently has not “initiated urgent actions to address the risk of jammed rudder controls in the 6 months since our preliminary report on this incident was issued.”

“The case for urgent action is even greater since, after we opened our investigation, the FAA became aware of two similar incidents that had occurred with foreign operators in 2019,” the letter noted.

Concerns Over Boeing

Homendy was critical of Boeing for what she said was a failure to inform United Airlines that faulty actuators were installed in the 737 planes that were delivered to the carrier.

“We are concerned of the possibility that other airlines are unaware of the presence of these actuators on their 737 airplanes,” her letter stated. “Not making operators fully aware of the installed systems and equipment on the airplanes delivered to them is unacceptable and cannot continue to be tolerated,” she added.

The Epoch Times has contacted both Boeing and the FAA for comment on the letter. Boeing has not publicly commented on the urgent safety warning or Homnedy’s letter to the FAA.

What the Urgent Warning Said

The NTSB said last week it is currently investigating an incident in February in which the rudder pedals of a Boeing 737 Max 8 that was operated by United Airlines became “stuck” in a “neutral position” during the plane’s landing rollout at the Newark International Airport in New Jersey.

The plane wasn’t damaged, and no injuries were reported in association with the incident, the agency said.

“NTSB investigators tested one of the rudder control components from the incident airplane, a rollout guidance actuator, at the component’s manufacturer, Collins Aerospace,” the NTSB warning stated. “When the incident actuator and an identical unit from another airplane were tested in a cold environment, the actuators’ function was significantly compromised.”

Investigators with the safety agency discovered there may have been moisture in the actuators of the plane, “which failed testing.”

Collins Aerospace, the maker of the rudder control components used by the the plane “subsequently determined that a sealed bearing was incorrectly assembled during production of the actuators, leaving the unsealed side more susceptible to moisture that can freeze and limit rudder system movement,” the agency said.

Collins had also told Boeing that more than 353 actuators produced by the company were delivered to Boeing since February 2017 that were impacted by the issue, according to the warning.

Another Blow to Boeing

This year, Boeing aircraft have been involved in several high-profile incidents, including when a Boeing 737 Max 9 passenger jet lost a rear door plug during a January flight. Subsequently, the FAA ordered the grounding of similar Boeing 737 MAX 9 jets for weeks.

In July, Boeing agreed to plead guilty to a criminal fraud conspiracy charge and pay at least $243.6 million after breaching a 2021 Justice Department agreement.

The planemaker also agreed to spend at least $455 million to boost safety and compliance programs, overseen by an independent monitor for three years.

Last week, FAA head Michael Whitaker told a House panel that safety culture improvements at Boeing may take three to five years to complete.

“It is not a six-month program; it is a three-year to five-year program,” FAA Administrator Mike Whitaker said at a two-hour hearing, adding he has spoken to Boeing CEO Kelly Ortberg and the company’s board of directors about the need for safety culture reforms.

The agency administration said Boeing has made significant improvement in the short term. “On culture it is a long-term project … there is progress but they are not where they need to be,” he said.

Meanwhile, tens of thousands of Boeing machinists in Washington state and Oregon are still on strike after walking off the job on Sept. 13 in the union’s first strike since 2008, halting production of airplane models including the 737 Max.

The union is seeking a 40 percent pay rise and the restoration of a defined-benefit pension that was taken away in the contract a decade ago.

On Sept. 27, the International Association of Machinists and Aerospace Workers said that its pay deal talks with Boeing had broken off and that there were no further dates scheduled for negotiations at this time.

Reuters contributed to this report.