Boeing says it’s cutting 10% of its workforce, or about 17,000 employees

Boeing on Friday said it’s cutting 10% of its workforce, or about 17,000 employees.

In a in a memo Friday, CEO Kelly Ortberg announced the layoffs, writing that the aerospace giant must make “tough decisions” to stay competitive. Ortberg added that the company is also delaying its program to develop the 777X airplane and halting production of the 767 aircraft after it delivers the remaining 767 planes that have been ordered by customers. 

The layoffs and production changes come amid a labor dispute at Boeing, with 33,000 machinists going on strike last month after failing to agree on a contract. The aerospace giant’s finances and reputation have also taken a hit this year due to manufacturing problems and multiple federal investigations, following a mid-air panel blowout in January. 

“Our business is in a difficult position, and it is hard to overstate the challenges we face together,” said Ortberg in the memo. “Beyond navigating our current environment, restoring our company requires tough decisions and we will have to make structural changes to ensure we can stay competitive and deliver for our customers over the long term.”

Ortberg, the former head of aerospace company Rockwell Collins, joined Boeing as CEO in August, replacing outgoing CEO Dave Calhoun in the wake of increased regulatory scrutiny sparked by production problems at the storied company.

In his Friday memo, Ortberg said the layoffs will include executives, managers and employees, and take place within the “coming months.”