European aviation giant Airbus will soon cut nearly 2,500 jobs in its defence and space sector, according to people familiar with the matter, AFP reported on Wednesday.
Airbus, which employs 35,000 people in its defence and space divisions, is taking steps to manage rising costs and delays in defence projects, the report added.
A significant portion of job cuts is expected to impact the space division, which also includes fighter aircraft and cyber security operations, reported Bloomberg, citing sources who requested anonymity as they were not authorised to discuss private deliberations.
Airbus declined to comment on this news. However, Airbus has been incurring expenses of almost €900 million ($980 million) in its space sector programmes as “complex and sophisticated products” have led to development risks, according to a report by Bloomberg.
Therefore, the company is evaluating “all strategic options such as potential restructuring, cooperation models, portfolio review and M&A options,” Bloomberg reported. Airbus is also in discussions with unions regarding the job cuts, it added.
In addition to designing and manufacturing commercial aircraft, Airbus, the aerospace company, also has defence, space and helicopter divisions.
Airbus is in a global duopoly with Boeing.
Boeing’s challenges
On Friday, Airbus’s competitor Boeing also announced plans to cut 10 per cent of its global workforce, amounting to nearly 17,000 positions, after an estimated third-quarter loss, according to a report by AFP.
Recently, Boeing also raised nearly $25 billion to fund operations through a combination of shares and bonds to deal with operational challenges, including a workers’ strike that has halted production for weeks in Seattle, according to a Bloomberg report.
The workers’ strike, driven by union members asking for higher wages and reinstatement of pension, has further strained Boeing’s production schedule.
Additionally, Boeing is also struggling with quality issues related to its popular 737 Max jets, which remain under regulatory observation. Recently, the company also delayed the launch of its much-delayed 777X programme, which has been moved forward to 2026.
