Boeing has told its workers to expect some job layoffs through the end of 2015. The said layoff will be taking place in the company’s satellite business and is expected to impact “several hundred” jobs.
Reuters reports that factors that led to the decision to do job layoffs include the decline in U.S. military spending as well as delays experienced in multiple commercial satellite orders. Moreover, the said delays are being caused failures of launch vehicles as of late and more importantly, the looming uncertainty surrounding the availability of future financing from the U.S. Export-Import Bank. The bank’s government charter actually lapsed last June 30.
Export-Import Bank is a factor, but not the only factor
And while Boeing admits that the uncertainty surrounding Export-Import Bank is a factor, a spokesman for the company has also told The Wall Street Journal that is not the only factor contributing to the layoffs. Another matter in consideration for Boeing are “customers who have decided to maybe hit the pause button or look somewhere else.”
Recently, Asia Broadcast Satellite (ABS) had cancelled a satellite deal with Boeing after failing to secure financing following the expiration of Export-Import Bank. Reuters reports that Boeing is still working with ABS to find an alternate financing solution. Boeing spokesman Tim Neale has also said that with Export-Import Bank out of the lending picture, “Boeing may need to serve as the lender of last resort but there are real limits to how much of this the company can do.”
No exact number yet on how many will be laid off
The exact number of employees who will be affected by the layoffs will reportedly be finalized in the coming months. Neale has also told Reuters that some of the workers in the company’s satellite business can also possibly find work in other businesses of the company.
Boeing does some satellite and commercial airplane production in California. This office reportedly has about 16,800 workers.