Boeing-Wichita Issues 8,100 Layoff Notices

AP via Yahoo ^ | 11 Mar 2005 | AP staff

[ladtx]

Associated Press
Boeing-Wichita Issues 8,100 Layoff Notices
Friday March 11, 4:00 pm ET

Boeing-Wichita Issues 8,100 Layoff Notices As Part of Sale Process to Onex Corp.

WICHITA, Kan. (AP) -- Boeing Co. issued 8,100 layoff notices Friday as part of its sale of commercial aircraft operations in Wichita to Onex Corp., with those workers being asked to apply for their old jobs with the buyer.

The 60-day notices went to 5,200 hourly and 2,900 salaried production and service workers, said Boeing spokesman Dick Ziegler. Engineers have not yet received pink slips.

The notices are part of the separation and re-employment process required as the Chicago-based aerospace leader transfers assets to Toronto-based Onex. Workers were asked to sign waivers allowing release of their personnel information to be considered for new employment with Onex.

Onex is forming a separate aircraft company in Wichita, which it has temporarily named Midwestern Aircraft Systems until a more permanent name is determined, said Ziegler, who also received a layoff notice.

In a memo sent Wednesday to employees, Boeing executive Jeff Turner assured employees that receiving a notice is not reason to panic or to assume they would not have a job with Onex.

Onex agreed last month to buy Boeing's massive commercial aircraft plant in Wichita, plus other work sites in Tulsa and McAlester, Okla., for $900 million cash and the assumption of $300 million debt. The sale is part of Boeing's strategy to focus its commercial aircraft business on design and final assembly.

[dozer7]

jeff turner at his best

we, they, us, the tanker boys sweating it out

[em2vn]

What type of business are you going to start? I just hope it isn't something that can be sent to China.
The leaders of this country on both sides of the isle are selling this nation and its citizens down the river in dealing with the Communists.

[investigateworld]

Bingo (Construction)

[Clemenza]

Every job I have ever held is dependent on foreign trade.

Are you aware that Airbus (not my favorite company in the world) sources 46% of the A380s components from the USA? That Mittal Steel (India) has been buying up American mills left and right? Are you also aware that the main source of decline for manufacturing jobs WORLDWIDE has been automation, NOT "outsourcing?"

[dozer7]

"When you happen to pull you head out you can kiss you own back side.C

I may be out of line here but I see a lot of card playing in section 41 by those protected and I am old guy. This facility was at 42% agreeded Boeing held it there. Maybe now we get it up to 90% and new folks. Now maybe we just get to build by god air planes. Do you have any idea what it takes to build a fully tested populated section 41 (787). It will take a couple of people. A grip is required here and not on your member.

regards

[free_european]

Sure he wouldve. I have no doubt all union thugs would be thugs still even if they weren't in unions. BTW I am aware most union folk aren't thugs; my grandad and uncle spent their whole working lives as union dockworkers.

[rdb3]

I'll see your Pat Buchanan and Sam Francis and raise you an Ayn Rand...

---

I am well aware of Buchanan's and Francis' take on trade. It sucks. But what did Rand have to say about this subject? And, no, I'm not a [L]ibertarian

[free_european]

The only part of the US steel industry that is doing well are the non-union mini-mills in right-to-work states down south.

[jettester]

From Boeing's website (News Release Jan. 14, 2005):

Another charge of approximately $340 million pre-tax, or $0.27 per share, is attributable to a decision to conclude production of the 717 commercial airplane in 2006 and includes expected supplier termination charges. Most of the cash expenditures related to the charge and an additional $45 million of period expenses associated with the shutdown are expected to occur in 2005 through 2007.

[carl in alaska]

Well management has improved a lot since the 70's, and the quality & performance of American cars is much better than 25 years ago. But American car companies are just not cost competitive with Asian companies in the small and mid-sized car models. Ford and GM make all their profits from luxury cars, SUVs, trucks, and car financing. They make decent profits as long as gas is cheap and abundant. But now that it's not cheap anymore Detroit is in big trouble financially. In addition, Ford & GM have billions of dollars in unfunded pension liabilities and retiree health care costs. If gasoline prices continue to rise, and I believe they will reach $3 per gallon in 5 to 8 years, Ford and GM are looking at the very real possibility of bankruptcy in 10 to 20 years. I don't blame the UAW for all their problems, but the UAW doesn't understand the concept of cost competitiveness. They bitch about jobs going overseas but they're not willing to do much to help Ford and GM become more cost competitive at home.

The other thing I wonder about is why these UAW guys think that auto assembly and parts production is a "career." Don't those guys get bored silly after about 5 years? I'd go absolutely crazy from boredom within 2 years in those jobs. Isn't auto assembly more of a job that young people could do for 3-5 years to save up money for college? Personally I don't understand the entire UAW mentality of wanting to do such boring work for 35 years that also gives people repetitive stress injuries. These UAW guys seem to have a lack of ambition and imagination.

[tahiti]

"What was the charge and how long did he get? Were you successful in a civil suit."

The charge was assault. Sentence, one year, suspended. No previous crimminal record.

Did not pursue a civil suit.

[carl in alaska]

"Average profit on a Ford Explorer was around 15K when gas was 1.50."

I just checked the numbers over at MSN Investor, and in 2004 Ford's net after-tax profit magin was 2.4% on sales. That means that on their average vehicle selling for $30,000, they made a whopping $720 in profits. So on an Explorer they probably made $1800 because those are higher margin vehicles.

The problem with the executive compensation argument is this: While there are a few dozen top executives who are over-paid at Ford and GM, the total overpayment only amounts to maybe $40 million per years, which is only $16 per vehicle when you're making 2.5 million vehicles per year. I was a corporate finance guy for 12 year and I worked at a defense manufacturing plant so I know this for sure: Other than purchased parts, 90% of manufacturing costs are labor and health care costs for factory and office workers. If you want to become cost competitive, you have to reduce those costs on a per vehicle basis. Compensation of top executives is a drop in the bucket compared to personnel costs for the hundreds of thousands of other corporate employees. That's why this executive compensation argument by unions is BS and is more of a public relations move to justify unproductive work rules and an uncooperative approach towards management and investors in the company.

[rdb3]

Bottom line for me is that Unions have done a lot of good things and helped a lot of working folks when lined up against corporate interests

---

Class warfare. Geesh... </shaking head>