Boeing cuts jobs

November 26, 2001 Posted: 1613 GMT

SEATTLE (Reuters) -- Boeing Co. announced 2,900 job cuts Monday, boosting its total since the Sept. 11 hijack attacks to 14,900, or nearly half the 30,000 jobs it has said it could cut by the end of 2002.

The 2,900 employees getting 60-day layoff notices include 2,100 in Boeing's beleaguered commercial jet unit, where orders have shriveled as airlines park aircraft and defer deliveries of new jets because of shrinking air travel demand, spokesman Tom Ryan told Reuters.

Chicago-based Boeing (BA: up $0.17 to $35.80, Research, Estimates)  said the latest cuts include 700 workers in its shared services group and another 100 mostly from its embryonic Connexion airborne Internet service and its joint strike fighter program, which lost a massive Pentagon award to rival Lockheed Martin Corp. (LMT: up $0.59 to $45.60, Research, Estimates)  last month.

The latest 2,900 cuts include 2,100 jobs in the Seattle area, Ryan said.

Boeing in announced 12,000 job cuts October, which take effect Dec. 14, and said it ultimately would cut 20,000 to 30,000 workers. The first round included 11,400 commercial airplane workers and 600 from shared services.

Boeing also redeployed 200 of 600 Connexion workers in late September as airlines backed away from the service and Boeing focused on flight safety and security applications for the satellite-based communications network.

The aerospace firm has slashed projected deliveries for its world-leading commercial jet unit to 350-400 in 2002 from an expected 522 this year. In 2003 the forecast falls even lower and some industry analysts believe the totals will lag projections.

Earlier this month Boeing Chairman Phil Condit predicted the current travel slump will cost the company about 1,000 jet deliveries over the next several years.

Depending on size, Boeing jetliners sell for roughly $30 million to nearly $200 million each. The company has said it needs to shed workers to meet its stated goal of remaining profitable despite the lost orders.

Several airlines already have failed and others are said to be teetering near bankruptcy in the wake of the hijackings, which boosted airlines' operating costs and left many of their planes half-empty.

At the end of October, Boeing employed a total of 196,500 workers, 91,600 at its Seattle-based commercial jet unit.

The company expects to send out its next batch of 60-day layoff notices on Dec. 21, Ryan said.