Spirit AeroSystems Holdings Inc. will start furloughing workers later in October, in response to the continuing strike at Boeing Co., the aerostructure supplier’s biggest customer.
Spirit will implement a 21-day furlough for about 700 workers supporting Boeing’s 777 and 767 jetliner programs beginning October 28, Spirit spokesman Joe Buccino said. If the strike at Boeing, soon to enter its sixth week, continues past November, Spirit will need to extend unpaid leave and begin layoffs, he said.
“These furloughs are in combination with a series of other cost savings measures, including a hiring freeze and travel and overtime restrictions,” Buccino said in an emailed statement.
The measures at Spirit highlight how the crisis at Boeing is rippling across the wider aerospace industry. Boeing is in the process of buying back Spirit after an ill-fated separation almost two decades ago. The supplier relies heavily on work from the U.S. planemaker, and has come under mounting financial pressure situation in recent years.
Spirit has exhausted its storage space for what it builds for the large 767 and 777 aircraft, Buccino said. Boeing is conducting only minimal output during the strike of 33,000 workers that has idled its main Seattle-area factories that assemble the wide-body jets. Production of the cash-cow 737 aircraft has also ground to a halt.
Talks between Boeing and union leaders broke down more than a week ago and haven’t officially resumed. Boeing’s latest offer included a 30% wage increase, while union officials are additionally pushing to reinstate a defined pension plan, something Boeing has said it won’t consider.
Spirit also makes parts for Boeing rival Airbus SE, which also plans to buy back some assets as part of the reintegration into Boeing.
Reuters reported on the planned measures at Spirit earlier.