In response to current challenging conditions in the commercial aircraft market, Boeing [BA] on Thursday said it will offer a voluntary layoff (VLO) plan to eligible employees to minimize the need for additional workforce actions.
The company also believes the ongoing hit to its industry from the COVID-19 pandemic means there will be a challenging road ahead for aerospace companies.
“But one thing is already clear,” Boeing CEO Dave Calhoun said in a statement to company employees. “It will take time for the aerospace industry to recover from this crisis. When the world emerges from the pandemic, the size of the commercial market and the types of products and services our customers want and need will likely be different. We will need to balance the supply and demand accordingly as the industry goes through the recover process for years to come.”
The COVID-19 pandemic hit Boeing and its suppliers as the company is still working to fix issues with its 737 MAX commercial aircraft so that it can be certified to return to flight this year. The aircraft has been grounded worldwide since March 2019 following two catastrophic crashes.
It will be several weeks before employees know who is eligible and receive more information on the layoff benefits, Calhoun said.
The statement on the market conditions and the workforce actions are part of Calhoun’s efforts to be transparent, he said.
“We’re taking actions, including offering this VLO plan, based on what we know today,” he said. “They will bridge us to recover as long as we’re not confronted with more unexpected challenges. I can’t predict with certainty what the next few months will bring, but I can commit to being honest about what’s happening and doing everything we can to protect our people and our business through this crisis.”
Calhoun said that Boeing remains committed to its customers and commitments in the commercial, defense, space and services areas. He also said the company “maintaining the stability of our supply chain so we’re ready to ramp up again when the pandemic is over.”