Boeing plans to cut up to 8,000 jobs this year at its commercial airplane division, according to two people familiar with the matter. As Hayley Platt reports, the move could slash $1 billion in costs and help it battle for sales against European rival Airbus.
U.S. planemaker Boeing is enjoying the biggest peacetime boom in its 100 year history. But it's still cutting costs to compete with European rival Airbus. Reports suggest Boeing could axe up to 8,000 jobs from its commercial airplane division. Making a possible saving of $1 billion. SOUNDBITE (English) Admiral Sinden, Market Commentator, Darren Sinden, saying: "Whilst it does mean scaling back the headcount by about 10 percent if you take the 8,000 number into account. It doesn't mean the business is necessarily shrinking in terms of productivity it just means that the number of people needed to make those planes and to run the business are actually less." The company have already confirmed around 4,000 jobs will go by mid-year, including some managers and executives. Although Boeing says any layoffs will be through voluntary redundancy. Planemakers are well aware of the global economic slowdown. And Boeing says the move is necessary to remain competitive. SOUNDBITE (English) Admiral Sinden, Market Commentator, Darren Sinden, saying: "The new planes that Boeing have introduced can be built in a more efficient less labour intensive way on the production line and I think that's indicative of the way businesses are going. The long term prognosis for jobs is that many more jobs in both the US and other developed economies and indeed the third world will be subject to automation." Cheap fuel in recent months has helped keep airlines buying. Boeing booked 70 new orders in February. Airbus just 18.