Boeing South Carolina plans to cut an undisclosed number of engineering positions through a voluntary layoff program — a first for the company’s North Charleston Dreamliner operations.
Two-hundred engineers have been selected to receive a voluntary layoff offer, though Boeing said it does not plan to lay off that amount.
The Boeing Co. said last month it plans to eliminate about 4,000 jobs in its commercial airplane business sometime this summer amid fierce competition from Airbus and others in the aerospace industry.
Although Boeing officials originally said Boeing South Carolina’s 787 Dreamliner operations would likely not be impacted, some cuts are expected over the next month.
The 200 selected employees will be notified today, company officials said. They will then have 30 days to decide whether to accept, as well as a five-day buffer during which they can change their minds.
If more than needed accept the offer, Boeing officials will decide whom to cut. If fewer accept, Boeing will consider other cost-cutting measures, such as managing contract labor or relying on natural attrition — leaving involuntary layoffs as a last resort, the company said.
The voluntary severance package offers employees one week of pay for every year with Boeing, up to 26 weeks. They must have been employed with Boeing for at least one year to be eligible.
“We never wanted to be in a position where we had to look at reducing. … Even though the numbers are small, it’s a big deal for us,” a Boeing official said. “This option will allow us to reduce headcount in some areas, which will allow us to grow in other areas, over time, to support the long-term business plan.”
Boeing S.C.’s nearly 8,000-employee workforce learned about the planned voluntary layoffs through an emailed letter this morning from Beverly Wyse, Boeing S.C. general manager and vice president.
“As part of these broader efforts, a small portion of our team has been identified to participate in the voluntary layoff program. ... As I mentioned in February, we continue to take all possible steps to avoid involuntary layoffs,” Wyse said in the emailed letter.
The 200 engineers who will receive the voluntary layoff offer were chosen based on their specific skill sets. These skills, which Boeing declined to define, were in great demand when Boeing S.C. built up operations. As the site leans out processes and becomes more efficient, certain skills are less-needed now, Boeing said.
“We are working hard to meet our business needs and increase our efficiency through a combination of strategies,” Wyse said in the letter. These strategies include “non-labor cost savings, supply chain savings, management of our contract labor workforce, natural attrition rates and other measures.”
“At BSC, our challenge is to balance these factors with our growing work statement over the next few years,” Wyse’s email said.
Boeing Commercial Airplanes CEO Ray Conner said in February the company plans to reduce costs in plane production across its entire Commercial Airplanes division. The companywide cuts — planned for midyear — include hundreds of executive and manager positions, Boeing spokesman Doug Alder Jr. said in an emailed statement.
“We’ve been able to reduce staffing levels through attrition, leaving open positions unfilled, and voluntary layoffs. We’ll only use involuntary layoffs as a last resort,” Alder said.
The company plans to “make fundamental changes for the long term to win in the market, fund our growth and operate as a healthy business,” Alder said.
Despite the cuts, the North Charleston campus continues to be in growth mode, as it is ramping up its Dreamliner production rates along with Everett, Wash., to 12 airplanes a month; beginning exclusive production on the 787-10 Dreamliner; and opening a 400,000-square-foot airplane paint facility — all scheduled for this year.
Hiring of engineers will continue at Boeing South Carolina, but for other skill sets than the positions currently being cut.
“The best path forward for us is to continue working together and stay focused on improving our efficiencies,” Wyse said in the letter. “I appreciate the incredible job you have done — and continue to do — at achieving that! We are an incredibly productive site. We can continue to find ways to do even better.”
Boeing did not comment on whether future cuts would happen at the North Charleston site.