Boeing Posts Earnings Amid Washington Job Cuts
Boeing is reporting an increase in profits from the same time last year even though there has been a decrease in plane sales.
The Chicago-based aerospace company did see an uptick in deliveries on its 787 Dreamliner and expects good prospects as it rolls out the 737 Max.
But Boeing is cutting output of the 777 jet, which has consequences for workers in Washington state.
The company announced late last year that it would cut jobs as a result of slowing orders. There have been a couple rounds of buyouts and layoffs since then. The latest announcement came earlier this month.
"I think that diligent, incremental approach is the right way to do it," Boeing CEO Dennis Muilenburg told investors and reporters in a conference call Wednesday. "It's respectful of our team, and it's a way that allows us to continue to invest in the future."
Muilenburg was optimistic that Washington state's largest employer would start seeing stronger sales in the near future.
He also noted that while the company is rolling out fewer 777 jets, production is expected to ramp up in the Puget Sound region as Boeing clients transition to the 777X.
But that won't necessarily translate to more jobs in Washington, according to Richard Aboulafia, an aerospace analyst with the Virginia-based Teal Group.
The company is putting a lot of faith and effort into the 787, which is produced largely in South Carolina. Even though 777X manufacturing will stay in Everett, the process is more automated.
"The amount of workers needed for a given amount of revenue, that's probably going to trend generally downward in the long run," Aboulafia said.
The rate of production for the 777 is set to drop again this year. More layoffs and buyouts are also expected.