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MCDONNELL DOUGLAS WILL CUT 14,000 TO 17,000 JOBS

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McDonnell Douglas Corp., the nation's biggest defense contractor and the No. 2 producer of civilian aircraft, said it will cut 14,000 to 17,000 jobs by the end of the year as part of a major restructuring program.

The company announced in June that it would slash costs by $700 million annually, due to slowdowns in the defense industry. McDonnell Douglas currently employs about 130,000 people.Al Egbert, general manager of the McDonnell Douglas plant in Salt Lake City, said the announcement will affect less than 10 people in Salt Lake City who do subassembly work on the MD-11 and MD-80 commercial aircraft.

Chairman John McDonnell, in a statement, described the move as "an essential element for improving the well-being of the corporation."

McDonnell Douglas, which suffered a 37 percent drop in profits last year when it earned $219 million on sales of $14.6 billion, has anticipated further declines due to cutbacks in Pentagon spending and delays in its production schedules.

About 8,000 of the job cuts announced Monday will be at the company's Douglas Aircraft Co. division in Long Beach, Calif., which makes the MD-80 and MD-11 jetliners and the U.S. Air Force's C-17 transport jet. Another 1,000 will be cut at other operations in southern California, including the company's Space Systems subsidiary in Huntington Beach and at California facilities operated by the Electronic Systems and McDonnell Douglas Helicopter Co. units.

The helicopter subsidiary also will cut 800 jobs at its main manufacturing plant in Mesa, Ariz.

The company also said it will cut 4,500 jobs from its operations in St. Louis, including 3,000 at the McDonnell Aircraft Co. unit, which produces F-15 Eagle jet fighters. It will eliminate another 1,000 jobs at other offices and parts manufacturing operations scattered throughout 25 states.

After next year, the Pentagon plans to stop buying the F-15, as well as the company's AV-8 Harrier jump jet.

The company has faced serious problems at the Douglas unit, including production delays for both the MD-80 and the MD-11. The company is the nation's second-largest producer of jetliners, although it is far behind industry leader Boeing Co.

McDonnell said last month in a letter to employees that the company also "faces potentially serious cost problems" on its fixed-price development programs for the C-17 military transport, the T-45A Goshawk Navy trainer and the A-12 Navy attack jet.

McDonnell also said in June that the company was not yet satisfied with its commercial jetliner production rate and cost structure.

Other elements of the cost-cutting plan include reduced capital budgets, significant cuts in budgets for travel, consultants and advertising and reduced overtime.

In addition, the company plans a 50 percent reduction in company contributions to salaried workers' savings plans.