Boeing is cutting 5% of its commercial airplane workforce as 737 output lags

Boeing announced on Monday that it will reduce its commercial plane workforce by approximately 5%, eliminating positions through a combination of layoffs and attrition. The company's decision to scale back production is aimed at providing its factories and supply chain partners with more time to achieve stability, according to a message to employees from Boeing's commercial chief, Stephanie Pope.

Pope explained that adjusting production schedules and reducing aircraft output has left the company in an overstaffed position. Despite making significant progress, she acknowledged that Boeing has not yet fully recovered. In a recent conference call, Boeing executives had signaled a slower plan to raise plane output, stating that the company would no longer meet its 2026 delivery target and would delay the resumption of 737 Max production to the second half of 2027.

Boeing's stock price had been grappling due to safety concerns and financial losses stemming from two fatal crashes involving the Max aircraft in 2018 and 2019. CEO Kelly Ortberg acknowledged that while the company has achieved some improvements, a fully stable production rate will likely take until the following year. He cited the need for greater predictability in wing production and fuselage manufacturing at the company's Kansas site as factors contributing to the slower growth in production.