SEATTLE (Reuters) – Boeing Co (BA.N) is set to offer buyout and early retirement packages to employees, two people familiar with the matter said on Wednesday, a bid to mitigate the financial fallout from the coronavirus pandemic.
FILE PHOTO: A worker leaves the Boeing Everett Factory, amid the coronavirus disease (COVID-19) outbreak, in Everett, Washington, U.S. March 23, 2020. REUTERS/David Ryder
Boeing was initiating a voluntary layoff plan that allows eligible employees who want to exit the company to do so with a pay and benefits package, one of the people said.
Boeing Chief Executive Dave Calhoun is expected to detail a voluntary layoff plan in a memo to employees as early as Thursday, the second person said.
Reuters reported last month, citing industry sources, that layoffs or furloughs were a “real possibility” as deferred aircraft deliveries and downpayments due to a virus-related plunge in air travel forced Boeing to consider tougher steps to reduce cash outflow.
A representative for Boeing declined to comment.
Boeing, which calls itself America’s largest exporter, has some 150,000 employees worldwide, nearly half of whom are clustered around marquee factories in Seattle’s Puget Sound region.
The buyout plan comes three weeks after the U.S. planemaker said it would freeze hiring and overtime pay except in certain critical areas to preserve cash.
The coronavirus pandemic has compounded the year-old crisis over the grounding of Boeing’s 737 MAX following fatal crashes that killed 346 people in a five-month span.
Boeing halted 737 production in January.
Last week Boeing halted operations at its twin-aisle factory and other facilities around Seattle after more than a dozen employees were infected – at least one fatally – by the virus that causes COVID-19.
The Wall Street Journal reported earlier on Wednesday that an announcement on early retirement and buyout packages could come as early as Thursday.
Boeing has called for a $60 billion bailout in access to public and private liquidity, including loan guarantees, for the struggling U.S. aerospace manufacturing industry.
Reporting by Eric M. Johnson in Seattle and Shubham Kalia in Bangalore; Editing by Tom Hogue & Shri Navaratnam