Boeing this week said that it would once again slash production of its 777 jetliner due to sluggish sales.
The Seattle Times reports that Boeing's Everett, Wash., plant will reduce its output of the wide-body jet from seven to five per month, effective August 2017.
The seven per month level was just implemented this month after Boeing officials announced a reduction from 8.3 per month early this year. In addition, deliveries are slated to be cut again — to 3.5 per month — in 2018 in order to accommodate construction of six 777X slated to be used in test flights.
Washington state awarded billions in tax incentives to Boeing in order to secure production of the 777X — which will replace the 777 beginning in 2020 — but the Times noted that the new 777 cuts would likely carve deeply into Boeing's bottom line and necessitate layoffs for some of the more than 12,000 workers currently assembling the planes in Everett.
Boeing officials told employees this week that the company expects job reductions next year and would “do our best to lessen the impact.”
“Despite tireless work by the sales team, orders have slowed,” 777 program official Elizabeth Lund said, according to the paper. “The market is signaling near-term hesitation in some regions.”
The company earlier this year announced plans to trim about 4,000 jobs through attrition and voluntary buyouts, and reports speculated that thousands more could be on the chopping block amid price competition with French rival Airbus.
The Times noted that an agreement reached over the weekend with Iran would send 15 of the current 777s to the Middle Eastern nation, but that even those sales, if completed, would not fulfill the orders needed for Boeing's current production pace.
