Boeing’s mounting woes

Boeing has been facing tough times since the January 737 Max 9 door plug blowout incident. The aviation giant’s stock is down 42% this year, and 33,000 unionized workers have been on strike for over a month.

The picketing has compromised 737 production, costing Boeing, its suppliers, and other connected businesses $5 billion in total, according to Anderson Economic Group.

The planemaker is now cutting 10% of its workforce, around 17,000 employees, to save costs, its new CEO Kelly Ortberg announced on Monday. However, this move risks further damaging its relationship with unions.

Boeing will also record $5 billion in charges related to its defense and commercial business in the third-quarter earnings.

It has delayed deliveries of the 777X craft to 2026, and Emirates, responsible for almost half of the orders, will be having “a serious conversation” with Boeing, the airline’s CEO said recently.

Investors are concerned that the aircraft maker also risks being downgraded financially, which could make it harder for them to borrow money in the future.

Ortberg has mentioned it will take time to solve Boeing’s issues. As of now, tensions with the workforce remain high.

S&P Global Ratings predicts that each month the strike continues, it could cost Boeing an additional $1 billion.