Boeing to cut 2,000 jobs as it struggles to recover after 737 Max crashes

A Boeing 737 Max jet prepares to land at Boeing Field following a test flight in Seattle - Elaine Thompson / AP Photo
A Boeing 737 Max jet prepares to land at Boeing Field following a test flight in Seattle - Elaine Thompson / AP Photo

Boeing is to cut 2,000 office jobs in the US as the struggling planemaker battles to improve its stalling production line.

Roughly a third of the 2,000 roles being cut are to be outsourced to India, according to The Seattle Times, with the remaining positions disappearing completely.

Managers have also been told to identify underperforming staff, raising the threat of future rounds of redundancies, as Boeing moves to cut bureaucracy and improve performance.

A spokesman for Boeing told The Seattle Times, which first reported the job cuts: “Over time, some of our corporate functions have grown quite large.

“And with that growth tends to come bureaucracy or disparate systems that are inefficient… So we’re streamlining.”

Alongside the redundancies came an edict for managers to identify 10pc of staff as “failing to meet all expectations” in their performance reviews – raising fears that Boeing was identifying more employees who could be cut in the future.

Boeing’s 10pc policy has reportedly been in force for years, but not strictly enforced.

A spokesman confirmed that “this year, we’re adhering to those guidelines … pretty rigorously”.

A similar policy was made famous by Enron, the US energy colossus that collapsed in 2001 under the weight of one the biggest frauds in American corporate history. There is no suggestion of any wrongdoing at Boeing.

The restructure is part of Boeing’s plan to focus its resources on engineering and manufacturing as it struggles to keep up with deliveries of planes.

The manufacturer has repeatedly failed to hit delivery deadlines as the tragic crashes of two of the planes in 2018 and 2019 casts a long shadow over operations.

Although the 737 Max jets have now been signed off as safe by regulators, Boeing has been hit by supply chain problems and production delays.

Boeing said it will increase its overall workforce size by 10,000 this year, with a “focus on engineering and manufacturing”. Headcount swelled by 15,000 last year.

Airlines are keen to acquire Boeing’s 737 Max aircraft as it will cut carriers’ fuel costs and reduce emissions.

The Seattle Times reported that Tata Consulting Services in Bengaluru, India would take responsibility for some of the head office functions being outsourced.