Boeing parts supplier Spirit AeroSystems has reportedly warned it may begin furloughing employees soon if the strikes at the aircraft manufacturer’s production plants continue much longer.
The supplier, which is set to fall back under Boeing’s control next year, is currently using the lull in work at the aircraft factories to address a backlog of orders but will soon begin seeing the effects of the work stoppage according to reporting from the Financial Times.
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Around 33,000 Boeing employees are currently on strike as part of a contract dispute with the International Association of Machinists and Aerospace Workers District 751 (IAMAW), which began on 13 September following the rejection of the initial negotiated offer.
Relations between the manufacturer and the union were also further soured earlier this week when Boeing made a pay offer directly to workers in a move described by IAMAW as showing “disrespect” to the union.
The union’s latest update said it would be returning to mediated negotiations on 27 September as it worked to increase Boeing’s current offer of a 30% general wage increase, improved 401(k) offering, and reinstation of performance programme bonus.
Despite this, with the dispute showing no signs of ending soon, sources at Spirit said the supplier could begin furloughing workers as soon as mid-October as it faced the prospect of a lack of orders.
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By GlobalDataOther manufacturers are also seeing a similar fate as the effects of the strike continue along the supply chain, with Boeing’s Chief Financial Officer Brian West telling employees earlier this month that the manufacturer was stopping issuing the “majority of supplier purchase orders” for its 737, 767 and 777 programmes.
The contract dispute is just the latest issue placing Boeing at the centre of supply chain troubles in the aviation industry as the manufacturer struggles to get its production back in line following a series of damning investigations into its quality control after a door plug blow-out incident on a 737 MAX in January.
The company’s troubles eventually saw it replace its former CEO Dave Calhoun with industry veteran Kelly Ortberg as part of a wider executive shakeup and attempt to regain its once industry-leading reputation.
Spirit also found itself at the centre of regulatory scrutiny for its role in the installation of the door plug involved in the January incident, leading Boeing to announce a $4.7bn agreement for the US manufacturer to buy back the sections of the supplier’s business making parts for its factories in a coordinated deal with Airbus.
