- Boeing plans to cut around 5 per cent of its Commercial Airplanes workforce, potentially affecting 2,500 employees.
- The reductions will combine attrition and involuntary layoffs, with notifications expected to begin in December.
- The company has pushed back its 737 production targets as manufacturing and supply-chain challenges persist.
Boeing is preparing to eliminate around 2,500 jobs from its commercial aircraft division as it struggles to increase jetliner production, highlighting the difficulties facing the US manufacturer as it attempts to rebuild its manufacturing operations.
The company plans to reduce its Commercial Airplanes workforce by approximately 5 per cent through a combination of employee attrition and involuntary layoffs. Notifications to affected workers are expected to begin in December, according to an internal memo from Stephanie Pope, president and chief executive of Boeing Commercial Airplanes.
The division employed 50,494 people as of December 2025, meaning the proposed reduction could affect roughly 2,500 positions.
"As shared in our third-quarter earnings, we need to reset the pace of our production rate ramps to provide our factories and supply chain partners additional time to achieve stability," Pope said in the memo, reviewed by Reuters.
"Adjusting our production schedules and reducing aircraft output puts us in an overstaffed position."
The announcement comes less than two years after Boeing undertook a much larger workforce reduction. In 2024, the manufacturer announced plans to eliminate around 17,000 jobs, equivalent to 10 per cent of its global workforce, amid financial pressures, a machinists' strike and the fallout from a door-plug blowout on an Alaska Airlines 737 Max 9 aircraft.
The latest cuts reflect a different but related problem: Boeing has orders for thousands of aircraft but is struggling to manufacture and deliver them at the pace it had planned.
Why is Boeing struggling to build more aircraft?
Boeing's biggest challenge is stabilizing production of its 737 Max family, its most important commercial aircraft program and a major source of revenue.
The company had previously expected to reach a production rate of 47 aircraft a month by summer 2026. It has now pushed that target to early 2027, as factory operations and suppliers need more time to deliver consistent output.
Chief executive Kelly Ortberg told investors during the third-quarter earnings call in October that Boeing would miss its 2026 production and delivery targets.
"Everybody wants us to go faster, I get that, but we're going to stay disciplined as we ramp up here," he said.
The production delays have been linked to difficulties in stabilizing manufacturing processes, including wing production and the availability of components. Boeing has been working to increase output without compromising quality and safety standards.
The 787 Dreamliner program is also facing challenges. Boeing has been trying to increase production from eight to 10 aircraft a month but has not yet achieved that target. Its 767 and 777 programs have also experienced disruptions.
The company's latest financial results illustrate the pressure. Commercial Airplanes reported third-quarter revenue of $10.7 billion but an operating loss of $697 million. Boeing attributed the performance partly to higher projected costs associated with production adjustments and increased supply-chain expenses.
The division delivered 161 commercial aircraft during the quarter, while its order backlog stood at more than 6,300 planes, valued at a record $612 billion.
What does the production slowdown mean for Boeing's recovery?
The manufacturing delays are affecting Boeing's broader financial recovery because the company relies on aircraft deliveries to generate cash and improve its balance sheet.
Ortberg has said Boeing does not expect to reach $10 billion in annual free cash flow until 2029, later than the 2028 timeline analysts had anticipated.
The company is targeting a production rate of 52 aircraft a month for the 737 program in the second half of 2027, after first stabilizing output at 47 a month. The timing will depend on whether its factories and suppliers can consistently support higher production.
The job reductions are therefore part of a wider effort to align staffing with a slower production schedule. Rather than increasing output quickly and risking further disruption, Boeing is giving its manufacturing operations more time to stabilize.
However, reducing the workforce also presents a longer-term challenge. The company will need sufficient skilled employees to support higher production when its factories are ready to increase output.
Boeing's recovery is particularly important for the global aviation industry. Airlines have been placing substantial aircraft orders as they expand fleets and prepare for growing passenger demand, but manufacturers have struggled to meet delivery schedules because of supply-chain constraints.
The pressure is also relevant to India, where airlines have placed major orders with aircraft manufacturers to support expansion. Boeing and Airbus have both been looking to India for engineering talent and manufacturing partnerships as demand for aircraft grows.
For Boeing, the immediate priority is no longer simply producing more aircraft. It is establishing a stable manufacturing system that can support higher output without creating further quality, delivery or financial problems.
The planned job cuts underline the cost of that adjustment. Even with a substantial order backlog, Boeing cannot translate customer demand into revenue and cash flow until it can build and deliver aircraft consistently.
