Wednesday, November 7, 2012
Boeing Celebrates Obama 2nd Term with Layoffs, California Plant Closings
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.
"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 , Northrop Grumman and Raytheon 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.