Boeing's Cost-Cutting Strategies Allegedly Harm Supply Chain, Reveals Union President

The International Association of Machinists and Aerospace Workers' President Jon Holden accuses Boeing of damaging its supply chain by persistently pressuring suppliers to reduce costs since 2012. This strategy, intended to boost efficiency, led to the sale of factories and cuts in quality assurance, contributing to current production issues with 737 MAX, 787 Dreamliner, and 777 jets. Boeing is working to improve quality control and regain FAA confidence following recent emergencies.

Boeing, the leading aerospace manufacturer, has been under scrutiny for its turbulent supply chain, with the International Association of Machinists and Aerospace Workers (IAM) accusing the company of damaging relationships with suppliers by relentlessly pressuring them to reduce costs since 2012 [1]. This cost-cutting strategy, intended to enhance efficiency, resulted in the sale of factories and the elimination of quality assurance teams, contributing significantly to the current production issues plaguing the 737 MAX, 787 Dreamliner, and 777 jets [2].

The IAM, led by its President Jon Holden, has been vocal about the need for Boeing to prioritize its workforce and refocus on the importance of maintaining a strong supply chain. Holden contends that Boeing's emphasis on stock buybacks, profit, and outsourcing work from the Puget Sound region has alienated many employees and eroded the integrity of the manufacturing process [1].

According to Holden, the union will demand more quality inspectors and union input into quality control processes during the upcoming contract negotiations to ensure the maintenance of manufacturing integrity and health [1]. Additionally, the union will urge Boeing to adopt a corporate culture shift, moving away from outsourcing and the pressure to build planes elsewhere [1].

Boeing faces a significant challenge in regaining Federal Aviation Administration (FAA) confidence and improving its quality control following recent emergencies. To address these issues, the company must work closely with its suppliers and prioritize the well-being of its workforce [2].

Sources:

[1] Seattle Times. (2023, March 31). As watershed contract talks with Boeing open, machinists think big. https://www.seattletimes.com/business/boeing-aerospace/as-watershed-contract-talks-with-boeing-open-machinists-think-big/
[2] Reuters. (2023, April 1). Boeing working to improve quality control, regain FAA confidence after 737 MAX, 787 emergencies. https://www.reuters.com/business/aerospace-defense/boeing-working-to-improve-quality-control-regain-faa-confidence-after-737-max-787-emergencies-2023-04-01/