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Boeing Announces Big Layoffs in Defense Division
CNBC ^ | 11/7/2012

Posted on 11/07/2012 11:22:15 PM PST by My Favorite Headache

Boeing announced a major restructuring of its defense division on Wednesday that will cut 30 percent of management jobs from 2010 levels, close facilities in California and consolidate several business units to cut costs.

Boeing Headquarters The company [BA 70.11 -1.47 (-2.05%) ] told employees about the changes on Wednesday, in a memo obtained by Reuters and confirmed by Boeing.

Boeing, the Pentagon's second-largest supplier, said the changes were the latest step in an affordability drive that has already reduced the company's costs by $2.2 billion since 2010, according to the memo.

The measures come as U.S. weapons makers are under pressure to cut costs and preserve profit margins amid dwindling defense spending in the U.S.

In a message to employees, Dennis Muilenburg, chief executive of Boeing Defense, Space & Security, said the company aimed to cut costs by an additional $1.6 billion from 2013 through 2015.

"We are raising the bar higher because our market challenges and opportunities require it, and our customers' needs demand it," Muilenburg said.

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He said the total savings would reach $4 billion, making the company healthier and better able to deal with a tougher marketplace.

He said Boeing would cut the number of executive jobs an additional 10 percent by the end of 2012, bringing overall cuts in its executive team to 30 percent for the past two years, a move that would result in a 10 percent cut in management costs.

Boeing said the changes were not a response to the threat of additional, across-the-board U.S. budget cuts due to take effect on Jan. 2, or the outcome of U.S. elections, but represented another step in its continuing drive to "be more competitive while investing in technologies and people."

Boeing said it could not project exactly how workers would lose their jobs because it would try to place people in its growing commercial business.

A company spokesman declined to say how many jobs had already been cut from the 2010 level.

Rival Lockheed Martin has reduced its management ranks by about 25 percent in recent years after announcing a voluntary buyout.

Boeing said it would also expand its efforts to cut supply-chain costs by working closely with its suppliers, but did not provide details.

Defense consultant Loren Thompson said the changes were needed to ensure Boeing's continued profitability.

"Many investors focus on Boeing's commercial operations," Thompson said, referring to the jet-making business.

"But defense provides 40 percent of the company's revenues and returns, so controlling costs there is crucial to maintaining the company's overall profitability."

Boeing and other top weapons makers like Lockheed Martin [LMT 91.15 -3.72 (-3.92%) ], Northrop Grumman [NOC 66.70 -3.18 (-4.55%) ] and Raytheon [RTN 55.47 -1.87 (-3.26%) ] have focused heavily on cutting costs and drumming up foreign sales to maintain profits as they prepare for a sustained period of weaker defense budgets.


TOPICS: Business/Economy; Government; News/Current Events
KEYWORDS: boeing; jobs; layoffs

1 posted on 11/07/2012 11:22:23 PM PST by My Favorite Headache
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To: My Favorite Headache

And so it begins..


2 posted on 11/07/2012 11:24:49 PM PST by packrat35 (Admit it! We are almost ready to be called a police state!)
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To: My Favorite Headache

The first of many such announcements.


3 posted on 11/07/2012 11:26:14 PM PST by Ciexyz (h)
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To: My Favorite Headache

The Big Shrug has begun.


4 posted on 11/07/2012 11:28:54 PM PST by dfwgator
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To: My Favorite Headache
Oh my GOSH, when was this ever disclosed?/sarc

Oh my GOSH, suppose Obama has some explaining to do?/sarc

Think the Media knew this before the election?/sarc

Think we need a Supreme Court interpretation on the "Label Disclosure Act" for products to extend to Candidates and all Media outlets?/s (if that is what the label disclosure is called)

5 posted on 11/07/2012 11:31:13 PM PST by annieokie
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To: dfwgator

North Virginia is going to basically morph into what the District of Columbia looks like....because nobody is going to have a high paying job or will be able to afford living there.

Gonna be a lot of desperate people out there very shortly.

Ugly has arrived.


6 posted on 11/07/2012 11:31:20 PM PST by My Favorite Headache (In a world where I feel so small, I can't stop thinking big.)
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To: My Favorite Headache

This is what they asked for.


7 posted on 11/07/2012 11:33:28 PM PST by Arthurio
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To: My Favorite Headache

What’s that saying...oh yeah now I remember..Elections Have Consequences


8 posted on 11/07/2012 11:34:03 PM PST by Sarah Barracuda
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To: My Favorite Headache

This would have been announced over a month ago, but Obama told all the union shops and other companies to hold off on notifying people about layoffs until after the election.

Nevermind the fact that, law requires a timely and multi month notification of layoffs.

That some management took an early hit is a bad sign. When it hits the union gimps, they’ll be awoken to a hell of a sad reality.


9 posted on 11/07/2012 11:36:04 PM PST by ArmyBratproud
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To: My Favorite Headache

DOD probably provided 50% of California’s wealth since the 2nd WW. Those times are gone.


10 posted on 11/07/2012 11:41:13 PM PST by eyedigress ((zOld storm chaser from the west)/?)
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To: annieokie

DING DING DING!!!! You hit it Annie...... they need disclosure labels a la prop 37!!! We need to know what’s in the BS the media feeds us!


11 posted on 11/07/2012 11:52:02 PM PST by antceecee (Bless us Father.. have mercy on us and protect us from evil.)
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To: eyedigress
My current DoD contract gig is in San Diego as I have to be onsite to do it. CA is getting my state income tax even though I'm a resident of Idaho. If the spigot goes dry, I'm going to be packed and headed home to Idaho overnight. The financial drag of renting a room, paying the high cost of living on the San Diego economy and high CA sales and income taxes are unsustainable if the paycheck stops. The jackasses in CA put Obama back in office. I won't have a moment's reticence to head directly home. I've had to be away from my family since June 2009 because of Obama.
12 posted on 11/07/2012 11:57:17 PM PST by Myrddin
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To: Arthurio

“This is what they asked for.”

Well they can enjoy the free birth control.


13 posted on 11/07/2012 11:59:01 PM PST by ari-freedom (Election Day should be after Thanksgiving, not right after Halloween)
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To: antceecee

I’m as Serious as a heart attack on that one. I do believe that something needs to be done about FULL DISCLOUSURE from the Media, and before any election takes place, or they can be held accountable via class action lawsuit.


14 posted on 11/08/2012 12:02:22 AM PST by annieokie
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To: ArmyBratproud

“This would have been announced over a month ago, but Obama told all the union shops and other companies to hold off on notifying people about layoffs until after the election.”

Boeing unions were a big deal since they didn’t like the idea of a SC plant.


15 posted on 11/08/2012 12:02:37 AM PST by ari-freedom (Election Day should be after Thanksgiving, not right after Halloween)
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To: Myrddin

The furthest west I stayed loyal to was Arizona. It dried up.
I did bid on contracts in SD.

My wealth tripled in Tennessee. North Carolina is now my place of residence and the work is non-stop. DOD and civilian.


16 posted on 11/08/2012 12:04:28 AM PST by eyedigress ((zOld storm chaser from the west)/?)
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To: annieokie

We should be able to sue... after all we PAY to view their so called service via cable! Need to file class actions on them all.


17 posted on 11/08/2012 12:10:56 AM PST by antceecee (Bless us Father.. have mercy on us and protect us from evil.)
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To: Myrddin
BTW, that AZ gig was 7 years running the LAFB B&G range for the tech side of the house. Don't be afraid of relocation. Lot's of very nice country and good people. It pays at least as well as anywhere, taxes are much lower. 3hrs from the beach and 3hrs from this......11/04


18 posted on 11/08/2012 12:16:32 AM PST by eyedigress ((zOld storm chaser from the west)/?)
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To: Myrddin
November 3rd.....



19 posted on 11/08/2012 12:26:50 AM PST by eyedigress ((zOld storm chaser from the west)/?)
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November 1 2012. Rocky Top


20 posted on 11/08/2012 12:35:14 AM PST by eyedigress ((zOld storm chaser from the west)/?)
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To: antceecee
I agree, but need some lawyer to take it on.

That shouldn't be to hard, they find a new disease to advertise for business every day, why not this? lol

If you've ever had, blah, blah, blah, blah, blah or blah call my office today, you may be eligible for a lawsuit.

Why not add "Failure to Disclose".

21 posted on 11/08/2012 12:47:07 AM PST by annieokie
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To: annieokie

Amazing that the conservative side does not have attorneys ready to pounce on it!


22 posted on 11/08/2012 12:49:25 AM PST by antceecee (Bless us Father.. have mercy on us and protect us from evil.)
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To: My Favorite Headache

The shiftless voted to kill the gooses supplying their gold eggs.


23 posted on 11/08/2012 1:14:17 AM PST by Happy Rain ("Remember the Benghazi 4")
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To: My Favorite Headache

Elections have consequences. For what its worth, I hope most of those layoffs are in Washington State enjoy what you voted for, Washington.


24 posted on 11/08/2012 3:22:48 AM PST by SoFloFreeper
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To: My Favorite Headache

Here it comes, but don’t worry, the latino, mexican, and illegal immigrant vote saw to it that a newer, younger workforce will spring up to take your place, and work for much less!


25 posted on 11/08/2012 3:43:53 AM PST by ducttape45
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To: My Favorite Headache

There will still be government employees, probably more of them.


26 posted on 11/08/2012 5:56:02 AM PST by duffee (Romney 2012, NEWT 2016)
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To: Happy Rain

gooses?


27 posted on 11/08/2012 6:24:56 AM PST by OldPossum
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To: eyedigress
I relocated my family from San Diego to Pocatello in Dec 2000. I had plenty of work that I performed at my home office until Obama took office. Everything dried up. The work I'm doing in San Diego is for a fairly protected element of DoD. I'm not afraid of weather. We have plenty in Pocatello. I am tiring of having to live far away from my family. I own my house free and clear. I don't want to get roped into having to cover a mortgage again...not at 56.
28 posted on 11/08/2012 9:28:04 AM PST by Myrddin
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To: Ciexyz

They cut 34 of 189 jobs where I work, then dropped another 45 of us down to part-time.


29 posted on 11/08/2012 9:32:06 AM PST by Stonewall Jackson ( "I must study politics and war that my sons may have liberty to study mathematics and philosophy.")
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To: OldPossum
Saying geese takes away from the spirit of the saying...like the double negative “don't mean nothing!” has more of an emotional impact than “does not mean anything!”

Cussing is usually profane bad grammar but “poor” grammar nonetheless or one may as well bless ones enemies out with proper diction and then duck when the pillows fly.

30 posted on 11/08/2012 2:35:28 PM PST by Happy Rain ("Remember the Benghazi 4")
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