Boeing to make “significant reductions” to supplier spending and stop most purchase orders for its 737 Max, 767 and 777 jetliners.
Boeing announced sweeping cost cuts Monday, including a hiring freeze, a pause on nonessential staff travel and a reduction on supplier spending to preserve cash as it deals with a strike by more than 30,000 factory workers.
Boeing factory workers, mostly in the Seattle area, started walking off the job early Friday after overwhelmingly rejecting a tentative labor deal, halting most of Boeing’s aircraft production.
The manufacturer will make “significant reductions” to supplier spending and stop most purchase orders for its 737 Max, 767 and 777 jetliners, CFO Brian West said in a note to staff. It was the first clear sign of how the strike will affect the hundreds of suppliers that rely on Boeing work.
The financial impact of the strike will depend on how long it lasts, but Boeing is focused on conserving cash, West said at a Morgan Stanley conference Friday. He said the company’s new CEO, Kelly Ortberg, wants to get back to the bargaining table right away to reach a new deal.
