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Boeing downsizing up to 5,000 more

Company to cut from commercial division by end of the year

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SEATTLE — The Boeing Co. plans to cut 4,000 to 5,000 more jobs than previously planned from its commercial airplane division by the end of the year as the airline industry remains mired in the worst downturn in its history.

The cuts will come through attrition and layoffs, said Boeing Commercial Airplane chief executive Alan Mulally in an e-mail sent to employees. After the terrorist attacks of Sept. 11, 2001, Boeing had said it would need to cut 35,000 from its work force by the end of 2003.

Now, with the continuing aviation slump, worsened by the severe acute respiratory syndrome outbreak this year, Chicago-based Boeing says it must further slash its employment levels.

"This is an unprecedented and very difficult time for all of us in the commercial aviation business," Mulally said. "While we are optimistic about the long-term outlook for the industry, many of our airline customers continue to face significant challenges as they struggle to recover their financial health and regain the ability to order new airplanes and related services. These actions are extremely painful for all of us at Boeing."

Boeing announced earlier this year that it would lay off 140 Utah workers. The company has about 400 employees in the state. Boeing officials could not be reached for comment Thursday regarding the possible impact of the new cuts on Utah operations.

Boeing has long said it would tie employment to its forecast production levels. But so far, the company has not changed its forecast of delivering 280 airplanes in 2003, and 275-300 airplanes in 2004, Boeing spokesman Bill Cogswell said Thursday.

Boeing is to report its quarterly earnings next week.

The announcement was a blow to the unions that have already seen massive layoffs in the past few years and are frustrated that there's little hope for a quick recovery.

"The economy is lagging, people aren't flying, carriers aren't buying, so we're losing jobs," said Mark Blondin, president of Machinists Union District 751, which represents Boeing production workers. "There's a leader in the White House who's done nothing on the economy."

Bill Dugovich, spokesman for the Society of Professional Engineering Employees in Aerospace, said Boeing is reducing its staff so much, it's jeopardizing the company's ability to develop its proposed new jet, the 7E7.

"We don't think they know what they're doing," said Dugovich.

By the end of the year, the Commercial Airplanes division work force will be 55,000 to 56,000 — about 60 percent of the 93,000 employed before the attacks and down as much as 8 percent from its current level of 61,000.

Earlier this week Continental Airlines announced it would defer delivery of 36 737 jets and is negotiating terms of delivery for another 11.

Boeing has landed some large orders this year.

AirTran Airways ordered up to 110 737s and 717s this month, All Nippon Airways finalized an order for 45 737s at the end of June, and an Air Force order for 100 767 refueling tankers cleared the White House last week and awaits congressional approval.

In trading on the New York Stock Exchange, Boeing shares fell 22 cents to close at $33.17.