Boeing CEO Dave Calhoun told the aerospace company's employees that it is starting a "voluntary layoff plan" that will allow eligible workers to leave the company with a pay and benefits package. The program is designed to shrink the company's workforce at a time when air travel is plummeting because of the coronavirus pandemic.
In a memo, Calhoun said the program "aims to reduce the need for other workforce actions." He didn't disclose in the memo how many buyouts the company is targeting within its workforce of 160,000.
Boeing, one of the country's largest manufacturers, has also been hit by fallout from deadly 737 Max crashes. Earlier this year, the company had warned that it didn't expect regulators to allow its grounded 737 Max fleet to return to service until the summer. Weeks later, the coronavirus outbreak was rapidly spreading across globe, decimating demand for air travel as countries ordered their citizens to remain home and curtailed international travel.
The challenges from the pandemic "means doing everything possible to keep this team intact," Calhoun said in the memo. "But one thing is already clear: It will take time for the aerospace industry to recover from the crisis."
Calhoun said the commercial market for airliners "will likely be different" by the time the pandemic ends. "We will need to balance the supply and demand accordingly as the industry goes through the recovery process for years to come," he noted.
Of the company's 160,000 workers, roughly 65,000 work on commercial aircraft while another 25,000 work for a division that makes parts and services for airlines, according to The Wall Street Journal.