The economic times may cause Boeing to alter production, a top executive said. Bloomberg News reports that Randy Tinseth, VP-marketing, hinted at this. The aerospace analyst at Goldman Sachs last week issued a report predicting fewer deliveries in coming years as airlines face financing difficulties. Bloomberg now reports pretty much the same thing.
Flight Global’s Laura Mueller reports that two lessors have urged production cuts.
This is the sort of “flexibility” Boeing seeks in its contract with the IAM and, upcoming, SPEEA: to alter production and jobs in bad times. Boeing says that the job guarantees sought by the IAM inhibits this flexibility. Airbus has long had handcuffs on its ability to reduce its workforce in bad times, due to European labor laws (as opposed to union contracts) that mean a huge severence pay that makes laying off people academic.
What’s interesting in Tinseth’s reported comments is the contrast with Boeing executive statements all year. Boeing’s top execs repeated told everyone who would listen (including, it seems, its own unions) that Boeing was insulated from any downturn because the backlog was so well spread out among customers around the globe in different economies and with varied business models. Some observers didn’t drink the cool aid, but certainly the labor unions took note and these chickens came home to roost in the current labor demands for reduced outsourcing and job guarantees.
So while Boeing execs were reassuring Wall Street, they in some respects set the stage for the current labor impasse.