Boeing Faces Financial Strain Amid Major Strike and Production Halts

Boeing has announced temporary furloughs for tens of thousands of employees after about 30,000 machinists went on strike, disrupting the production of various aircraft, including the 737 MAX. The first strike since 2008, it has led to halted negotiations and threatens significant financial losses for the company and its suppliers.

Boeing said on Wednesday it would temporarily furlough tens of thousands of employees following a strike by 30,000 machinists on Friday, which halted production of its prominent 737 MAX and other aircraft. CEO Kelly Ortberg informed employees via email about the upcoming temporary furloughs impacting numerous US-based executives and staff.

Ortberg also highlighted a planned pay reduction for Boeing leaders during the strike, which commenced with a new 737 MAX jet's mid-air malfunction in January. Despite mediation efforts, negotiations between Boeing and the International Association of Machinists and Aerospace Workers remain unresolved, with the union pushing for a 40% raise over four years.

The ongoing strike, the first since 2008, could precipitate financial losses in the billions, risk the company's credit rating, and impact its extensive supplier network. Boeing's shares have already plummeted by around 40% this year, underscoring the company's precarious financial position.

(With inputs from agencies.)