Boeing Warns of Furloughs from Shutdown

Boeing Warns of Furloughs from Shutdown

As U.S. lawmakers raced to avert a debt default, defense contractors pushed to highlight the harmful effects of the government shutdown, including more furloughs.

Boeing Co., the world’s largest aerospace company, said it may join a rising number of companies forcing its employees to take mandatory leaves of absences, known as furloughs, because of the gridlock on Capitol Hill.

The Chicago-based company, whose defense, space and security unit accounts for about a third of the firm’s 174,000 employees, was able to defer sending home workers after the Defense Department recalled civilians who oversee contracting activities, according to Daniel Beck, a company spokesman.


“While the return of these DoD employees has at least delayed the need for furloughs at some Boeing facilities, the continued impact of the government shutdown could still result in furloughs for some employees,” Beck said in an e-mail.

He didn’t specify how many employees would be affected if Congress and the White House can’t reach a deal to end the government shutdown.

The Treasury Department has said it will exhaust its ability to borrow on Wednesday. Stock markets were up a day before the deadline, as investors were hopeful of a Senate deal to end the shutdown and to extend the government’s borrowing authority.

Like other contractors, Boeing would have to furlough employees if agencies issue stop-work orders, limit access to installations where company employees work, and curtail government inspections or eliminate funds to continue operations, Beck said. The company is one of the Pentagon’s biggest contractors and makes numerous weapons systems, including the F/A-18F Super Hornet.

Lockheed Martin Corp., the world’s largest defense contractor, initially planned to furlough some 3,000 of its employees, though later reduced that number to 2,400 after the Pentagon ordered most of its civilians who were sent home back to work. Other companies have made similar workforce reductions.

Meanwhile, almost 100 chief executive officers of defense firms joined a conference call Tuesday to discuss the political impasse in Washington, D.C., according to Dan Stohr, a spokesman for the Arlington, Va.-based Aerospace Industries Association, a trade group representing defense and aerospace companies.

The call was designed to encourage the officials to voice their concerns about the political impasse to their elected representatives, Stohr said. “The concerns are obvious,” he said. “We can’t afford to default on our debt and the government shutdown is imposing very significant, real and immediate impacts on industry.”

And it’s not just the defense industry, Stohr said. The National Aeronautics and Space Administration has furloughed 97 percent of its workforce, he said. The Federal Aviation Administration has closed an aircraft registry office, halting some deliveries of planes to customers, he said.

Indeed, some of Boeing’s non-defense workers have already been impacted, Beck said.

“We have Boeing employees supporting other activities that continue to be adversely affected by the shutdown, including NASA and other government customers,” he said. “The Defense Department action does not address those employees or operations.”

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Boeing, the aerospace company I loved, the company I always praised and defended. Like much of it’s American colleagues, is now (for the recent few years) ‘coasting’ on decades old models. Nothing new to show, no capability to do anything new (regardless of money). Selling McD-D ‘legacy’ (OLD) fighter jets from a time when America had it’s crap together and designed premier airplanes. McD-D destroyed Boeing’s commercial business through a hard right WASP idiot attitude (no R&D, no investment, just coasting on previous designs), but funny enough McDonnel COULD build decent military platforms. Now neither can do neither. Sad. At least Lockheed is building NEW aircraft (even that’s highly debatable of a track record). It needs to come, the day corporate and governing America reasesses their ideologies, and invests in the future. That’s what ‘winning the future’ means. Instead that headless K..unt from Alaska calls it ‘wtf’. Great.

Now that Lockheed and Boeing have spoken, certainly Congress will do their bidding as they always do.

Who said that Boeing can’t build new aircraft anymore? I think it’s more about doing what the customer want. Lets hope that’s lockheed “unmatched” capability to build cheap and capable aircraft is going to be met with skepticism in the future.

I am seriously concerned they can’t. See, if you outsource everything, including CAPABILITIES, you tend to have difficulty doing what made you great. Those thousands and thousands of American engineers who were thrown on the crap heap, they lose their capabilities. You have to keep being busy designing and engineering things in order to keep those smarts. If a person stops talking for a few months, his vocabulary will be greatly diminished. Same for aviation. Hope I’m wrong.

God damn it, Boeing looking to ‘market’ Brazilian transport aircraft, and swedish trainer aircraft etc. This is BOEING, that built the worlds biggest and most reliable aircraft for a CENTURY. Like a homeless bum now, looking to tag onto others. It’s deeply saddining.

Oh CE I am afraid you are correct. The trend to “release the expensive expertise” for the “cheap college liberal labor” has killed the American supremacy in building unsurpassed airpower. The companies that have fully embraced the trend, Lockheed, Boeing, Northrup-Grumman, etc.” no longer have the home grown talent to compete much less defeat the European markets for reliable aircraft.

Dfens my friend, I agree with you on congree doing their bidding. But penguins have always been flightless birds.

So now what? How does this get fixed (well it takes a few years/decades and hundreds of billions in education spending and industrial government POLICY), but has there been a plan put in motion? Does the pentagon/lawmakers even care that ‘their’ companies are firing their lifeline? Or are those people equally stupid, and look at powerpoint presentations and think GREAT!

It would be easy if the DoD gave more contracts to smaller companies that took their customer more seriously. Boeing and Lockheed can do whatever they want, with the right people on HASC.

I feel also concerned about outsourcing, but when did boeing outsourced their capabilities? Can you name any of them?

Considering that those big companies got the patents –including northrop– there is not much hope to expect from new players. General atomic is more the exception than the rule. Not that I support a sole manufacturer but what could a new player do except assembling all the parts from other contractors?

You don’t try to stop a giant by creating another giant, all you can really do is to avoid getting a giant in the first place. That is, they should have blocked all those consolidations decades ago. While I was not born yet, I think that those problems were already present in the 70s; it’s just that they are getting more and more unsustainable by now.

Most of the real consolidation occured in the ‘90s after the Cold War ended. Companies didn’t take downsizing very well and preferred to merge with each other into giant megablob companies. Lockheed and Martin-Marietta, Boeing and McD, Northrop and Grumman. That’s six relatively big companies that became three huge ones. And I’m probably forgetting a few along the way. There’s General Dynamics, which got absorbed into Lockheed (makers of the F-16). Fairchild Republic that made the A-10. Rockwell, maker of the B-1B.

A partial consolidation is inevitable, too much consolidation is indeed a formula for Greed, Complacency and INcompetence. However not necessarily. I give you an example: Airbus/EADS. Now this might sound pro-Euro etc but it isn’t, bear with me (I root for Boeing actually, just a fan). Airbus/EADS is a consolidation of major (minor) national aerospace companies of different euro countries. They made a big 1 to compete with Boeing, and with proper management (long term investment) and proper POLITICAL POLICY, the governments wanted to keep making new planes etc, and they WANTED to have a huge player in this arena (and sustainable player), we now have a company that made the a380/a400 AND a350 in a mere decade give or take. That is HIGHLY commendable, ENGINEERING capability wise. Regardless of problems, lack of sales perhaps etc. The ‘ability and capability’ is there. And it’s where I’d put my money regarding reliable aircraft engineering.

How dare those disgusting paid for American politicians allow the companies that built the world’s 1 biggest, 2 most reliable, 3 quickest, 4 stealthiest etc etc planes, allow to let that die on the vine, and now perhaps only being sufficient in building propellor drones? It makes me want to march on capitol hill with a pitch fork. The crown jewels of ‘intelligence (brain intelligence) and engineering r&d have been ‘slimmed down’ so much in the name of short term profits, there isn’t much to do but start over. Look at shipbuilding as a precursor. I hope I’m wrong.

I hope any knowledgable person can chip in here, but as far as I know Boeing has (on the COMMERCIAL SIDE, arguably THE most important part of any aerospace company capability and engineerins wise) outsources SO much on it’s newest plane (787) that it lost control of it. You all may not hear it, because it’s not what you follow closely, but it has been THE worst entry into service of any Boeing airplane. See, outsourcing can be done, as long as the OEM (Boeing/Airbus) designs the complete thing, in and out, and then gives detailed blueprints of (small) parts to subcontractors who build those parts. Boeing let the subcontractors DESIGN/ENGINEER and TEST those parts, which as we now know, became incompatible with one another. Many sub suppliers world wide etc. So, Boeing even gave the designing and engineering of the WINGS away to Japan (most important part in an airplane), so arguably has lost the capability to make wings itself. And the entire electrical system is a mess (many different suppliers who didn’t even talk to each other). Boeing pursued the role of ‘integrator’ of all those parts, and has now found that to be incredibly difficult. Lesson learned: due to doing it ‘on the cheap’ and outsourcing almost everything and firing your own engineers, you get a big pile of MESS, which you have to spend FOUR TIMES the money you’d hope to save on, via contract engineers and new hires etc, and FOUR YEARS LATE, and UNreliable plane.

By god I hope those idiotic WASPS have learned and will not REPEAT this mistake again. No racist, just vehemently against the anglo-saxon school of economics. Disastrous.

People reminiscing about the great capabilities of McDonnell-Douglas should bear in mind the last fighter it designed from sctach is the F-15, designed over 40 years ago. The AV-8B Harrier is a modified version of the British AV-8C. It was “bestowed” upon Mac by the Marines as the price it had to pay to get STOL capability(Sen. Symmington from Mo had to have a quid pro quo to redirect funding from the F-4). The F-18, which is the bread and butter fighter for Mac, is a derivative of the Northrop F-17. Mac turned to it, after losing the F-16 competition to General Dynamics. The A-12 bomber, which was based on a General Dynamic design, was cancelled because of cost overruns. Mac Lost the ATF competition to Lockheed. The F-15 gave it an enormous amount of hubris and it understimated the competition. Fortunately, Boeing “bought” Mac so that Mac could do a Trojan Horse takeover of Boeing. Thus, the Mcdonnell family fortunes have flourished, even as Mac lost fighter competition after competition.

Mcdonnell itself was a pretty good defense contractor, but relied on ‘cost overruns and gubmint money’ to thrive. They first took over Douglas, a HIGHLY respectable aircraft BUILDLER, who’s designs are still in use today. Iconic craft like the dc-8/9/10. Mcdonnell only repainted one model and called it the md-11, and as we know it was a dud as was the company. Now it’s doing to precious Boeing what it did to Douglas.

May the McDonnell family all die painful cancerous deaths. That’s what they deserve for single handedly destroying one GREAT company and almost having destroyed a second one. When they say all enemies foreign and domestic, this is what you should see.

I remember to have heard about some glitches with the 787, but not that the japs designed the wings. I don’t say that you are wrong, but to my opinion this more of a “warning flag” than a fact. That is, they tried a different model of execution and it didn’t worked exactly as planned; I don’t like it either. But to say that they lost the capability to design their own aircraft is inaccurate.

They were so many innovations inside the 787 that it literally forced airbus to revise it plan for its A-350 as their initial plan was to offer an aircraft using alu alloy with a much lower cost of development. In that perspective I found hard to believe that Boeing’s engineering force is dying, not that this should be ignored however.

I got to disagree with you. While I am a fan of both airbus and the eurofighter, Airbus and EADS are two different animal. Airbus is very successful, EADS could do much, much better.

By looking at project like the eurofighter, there have been significant delays and cost overrun in part because there is too many chiefs not enough Indians; it was significant enough that the European press named it the €urofighter. The lack of consensus is really bad: the french pulled out early enough and the Germans tried more than once to pull off from that project. Even worse at some point they ended up with each country having a different aircraft.

Don’t get me wrong, I love this aircraft but I believe that they could be doing better with more consensus, or at least for their biggest long term project like the eurofighter. But compared to writing a blank check to lockheed for the f-35, I am not sure which one can get the most unsustainable; if nothing change the latter will be the big winner.

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