Boeing’s largest supplier announced it will lay off a significant number of its employees due to the suspension of the Boeing 737 MAX production following several high-profile accidents.
Spirit AeroSystems, which makes fuselages for the MAX and other Boeing products, said on Friday that it would furlough about 2,800 workers at its Wichita, Kansas, facility.
“The difficult decision announced today is a necessary step given the uncertainty related to both the timing for resuming 737 MAX production and the overall production levels that can be expected following the production suspension,” said Tom Gentile, Spirit AeroSystems president and CEO, in a statement. “We are taking these actions to balance the interests of all of our stakeholders as a result of the grounding of the 737 MAX, while also positioning Spirit to meet future demand.”
Boeing 737 MAX jets were grounded around the world early last year after two plane crashes in less than six months left hundreds of people dead.
But in its statement, Spirit said it has not yet received a notice from Boeing on how long the production suspension will last.
“When production resumes, the levels will be lower than previously expected due, in part, to the customer’s need to consume over 100 MAX shipsets currently in storage at Spirit’s facilities. In addition, Boeing has several hundred MAX airplanes built but not yet delivered to its customers,” the firm wrote in elaborating on why it had to initiate the layoffs.
In the coming days, the company will implement more workforce reductions at facilities in Tulsa, Oklahoma, and McAlester, Oklahoma. Spirt didn’t specify how many jobs would be impacted.
“Our goal is to support Boeing and a safe return to service of the MAX,” said Gentile. “We continue to work with Boeing to develop a new production schedule for 2020 with an eye toward minimizing disruption, maintaining the stability of our production capabilities, and best positioning Spirit for the future. When production levels increase sufficiently in the future, we look forward to recalling employees impacted by today’s announcement.”
The MAX planes were grounded following the Ethiopian Airlines accident on March 10, 2019 that killed all 157 people on board. Months before that, in October 2018, a Lion Air plane crashed and killed 189 passengers and crew.
Boeing is the largest manufacturing exporter in the United States, and hundreds of suppliers and vendors depend on it. In the meantime, the broader U.S. economy appears to be growing, and on Friday, the Labor Department reported that American employers added 145,000 workers in the month of December.