Spirit AeroSystems is furloughing 700 workers as Boeing strike continues

Boeing provider Air spirit systems The company will furlough about 700 workers as a mechanics strike at the aircraft manufacturer enters its sixth week, a spokesman for the supplier said on Friday.

More than 32,000 Boeing workers left their jobs on September 13 after an initial labor deal with Boeing was overwhelmingly rejected, deepening the financial pressures faced by the planemaker and presenting a new challenge for CEO Kelly Ortberg, who took the reins more than a year ago. A little over two months.

The furloughs represent about 5% of Spirit’s U.S. workforce, according to its most recent annual report. Meanwhile, Boeing and the Machinists’ Union remain at an impasse, and Spirit is considering deeper cuts.

“If the strike continues beyond November, we will have to implement additional layoffs and furloughs,” company spokesman Joe Buccino told CNBC on Friday.

Ortberg, who faces investors in his first earnings call next Wednesday, last week announced a series of tough measures aimed at cutting costs as the company’s losses mount, including cutting its workforce by 10%, or about 17,000 people. Boeing is also ending commercial production of the 767 when orders are fulfilled in 2027, and said its long-awaited 777X widebody jet would not debut until 2026, delaying it by another year.

Boeing is in the process of raising debt or equity to increase liquidity.

The approximately 700 Spirit workers affected by the 21-day furlough are assigned to Boeing’s 777 and 767 programs, for which Spirit has built up a “significant inventory,” Buccino said. He added that Spirit workers on Boeing’s best-selling 737 Max aircraft were not affected. But work on the three programs was halted due to the strike.

Boeing agreed to acquire Spirit this summer, but the companies do not expect to close the deal until mid-2025. Reuters previously reported on Spirit’s latest furloughs.