More Cuts Planned at Douglas Aircraft
McDonnell Douglas is planning substantial layoffs at its Douglas Aircraft unit during 1992, totaling from 500 to 2,100 more workers than earlier anticipated, according to an internal company planning document.
The firm said Friday that it would lay off 2,200 workers by January, 1992, the result of cost-cutting efforts and weak demand for aircraft. It was the first major layoff to affect hourly workers, although the firm has laid off 7,500 administrative workers and engineers in the past 18 months.
The planning document, a forecast of workers required on each of the firm’s three production programs, indicates that Douglas would eliminate 2,100 jobs from January to December of 1992. But at least some of those cutbacks were apparently included in the round of layoffs that occurred last Friday. According to the memo, at least 500 jobs over those announced Friday would be lost.
Company spokeswoman Renee Handler acknowledged that the firm expects to lay off additional employees during 1992, but said the firm would notify its workers before making any public comment on the specific numbers involved.
Handler also said the planning document may be out of date, since it is 2 months old, but she declined to discuss the firm’s more recent estimates. Handler said that changes in production schedules, productivity and attrition make such forecasts long into the future difficult.
The Douglas layoffs are the result of weakening aircraft orders and continuing efforts to cut production costs.
American Airlines, among McDonnell’s largest customers, has cut 11 options for MD-11s, worth an estimated $1.1 billion of future sales, an American spokeswoman said Tuesday.
McDonnell is also trying to cut the number of work hours needed to build its aircraft. “We are still not cost competitive, and unfortunately the company is going to have to continue to make reductions until we are,” Handler said.
The job forecast document did not give a breakdown of where the layoffs would occur, but virtually all of the cutbacks announced last week affected the Long Beach and Torrance plants.
Union officials at United Auto Workers Local 148 said Tuesday that they were braced for a tough year in 1992.
“We fully expect more cuts next year,” said Karl Fees, a Local 148 official. “They are expediting those cuts by shipping jobs out of the state.”
Separately, Sen. Jeff Bingaman (D-N.M.) introduced a resolution Tuesday calling for an examination of the impact on the aerospace industry of McDonnell’s plan to sell 40% of its commercial aircraft business to Taiwan Aerospace. Bingaman also said that the Joint Economic Committee would hold a hearing into the sale on Dec. 3.
