US aircraft manufacturer Boeing on Friday announced that it would cut 10% of its workforce and that deliveries of its 777X model would be delayed further.
In a message to employees, Boeing chief executive officer Kelly Ortberg said that the company needs to "reset our workforce levels to align with our financial reality and to a more focused set of priorities."
Ortberg also announced "some difficult decisions and several program updates," including further delays of the first delivery of its 777X model from 2025 to 2026.
The model was originally presented as the successor to the widely used 777 in 2013 with an initial service date set for 2020, but was slowed down by major delays in development and certification, as well as simultaneous difficulties with other aircraft types.
"Our business is in a difficult position, and it is hard to overstate the challenges we face together," Ortberg said in the message.
"Beyond navigating our current environment, restoring our company requires tough decisions and we will have to make structural changes to ensure we can stay competitive and deliver for our customers over the long term."
The Boeing boss said that the manufacturer would focus on building and delivering "the remaining 767 Freighters ordered by our customers and then conclude production of the commercial program in 2027."
Ortberg also said that the company's defence, space and security unit was expected to see "substantial new losses" in the current quarter "driven by the work stoppage on commercial derivatives, continued program challenges and our decision to complete production on the 767 freighter."
"We need to be clear-eyed about the work we face and realistic about the time it will take to achieve key milestones on the path to recovery," Ortberg said.
"We also need to focus our resources on performing and innovating in the areas that are core to who we are, rather than spreading ourselves across too many efforts that can often result in underperformance and underinvestment."
The aircraft manufacturer is in crisis after a series of mishaps. It has been under increased pressure to improve quality controls since an incident earlier this year, when an almost new Boeing 737-9 MAX operated by Alaska Airlines lost a door plug during ascent, leading to a gaping hole in the fuselage.
In addition, production of the 737 and the 777 long-haul aircraft is currently at a standstill due to a strike by the largest Boeing union, which represents 33,000 workers.
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