Spirit AeroSystems Forced to Furlough 700 Workers

The ongoing strike by Boeing machinists has now entered its sixth week, prompting supplier Spirit AeroSystems to furlough approximately 700 workers. To furlough in this context means temporarily laying off employees without pay for a specified duration. This decision comes as a response to the financial strain that the strike has imposed on Boeing and the aviation industry as a whole.

Boeing and the machinists’ union remain at an impasse, where no resolution is in sight. The work has halted production of Boeing’s 737 Max, 777, and 767 programs. However, Spirit’s workers dedicated to the 737 Max are not affected at this time due to Spirit’s built-up inventory. 

As Boeing grapples with its financial situation, the company is reportedly exploring options to raise capital to strengthen its liquidity. The strike and the financial toll it brings comes at a critical time for Boeing, which plans to acquire Spirit AeroSystems by mid-2025. 

The aerospace sector has faced a challenging few years, with the global pandemic crippling demand for air travel and forcing major companies like Boeing to scale back their production. As the industry could finally sense light in this dark tunnel, these labor disputes and production delays threaten to stall that recovery. Companies in the aviation sector will need to navigate these turbulent waters carefully, maintaining operational readiness to meet future demand.

The weeks ahead will be pivotal for Boeing’s future operations and leadership. As the CEO of Boeing, Kelly Ortberg prepares for his first earnings call next week amidst investor concerns. Ortberg assumed the role just over two months ago and will face one of his first major tests in this position. As for the broader aviation industry, they must heavily monitor this, as the impact of these disruptions could extend beyond Boeing and Spirit, affecting customers and suppliers alike.