After Boeing’s commitment to reorganization plans, Airbus has now announced layoffs. The European aerospace group announced job cuts in the Defense and Space division. The Airbus job cuts will affect 2,500 employees who represent around 7% of the workforce in its second-largest division and 1.7% of its workforce overall. The organization has decided not to pursue immediate restructuring plans and will execute these cuts over time, extending midway through 2026.
The Airbus defense job cuts announced in 2024 have been linked to a “complex business environment” due to high costs and rapid changes in warfare. Despite the growing demand for defense equipment, industry stalwart Airbus has been faced with stiff competition from new companies.
Image: Airbus
Airbus Layoffs Announced—2,500 Jobs in the Defence Space Will Be Affected
Airbus’ job cuts are not the first sign of distress at the organization. Earlier in the year, the organization admitted that it would not meet production targets and readjusted the number of planes it could make in the next two years.
According to a Reuters report from earlier this year, Airbus’ OneSat family of commercial telecom satellites had been swept up in financial charges at its Space business. The company had racked up over 600 million euros in charges by February this year, facing multiple challenges in fully following through with its plans. Chief Financial Officer Thomas Toepfer explained that 200 million euros were related to 2023 with the rest attributed to previous or future years.
CNN reports that Mike Schoellhorn, chief executive of Airbus Defense and Space, indicated that the sector has encountered “a fast-changing and very challenging business context with disrupted supply chains, rapid changes in warfare, and increasing cost pressure due to budgetary constraints.” He further elaborated that the Airbus layoff would help their unit become “faster, leaner and more competitive.”
Airbus Job Cuts in the Defense Division Will Not Occur Immediately
The Airbus job cuts have been put on hold for now as the organization assesses the financial repercussions of the cuts. In a webcast posted to the company page, investor relations head Helene Le Gorgeu said, “We are currently in the early-stage assessment of the potential financial impact and a restructuring provision is expected to be recognized once necessary conditions are fulfilled.”
Airbus operates in multiple locations such as Germany, Britain, and Spain, with its central operations in France. The company now has to engage in talks with the unions and host nations in order to discuss where the layoffs will take place and how the cuts will proceed. Reaching a solution is likely to take a few months at the earliest while the company scans through its operations and narrows down on the best way to get the business back under control.
Restructuring efforts are fairly common but such large-scale changes are occurring more commonly across industries. Airplane maker Boeing has also reported layoffs at its organization after it faced multiple hiccups in production and repeated regulatory scrutiny.
Over 33,000 Boeing workers went on strike last month after the organization failed to offer a satisfactory contract with them, but amidst all the reports of negotiations, Boeing announced that it was laying off around 17,000 employees.
For both Boeing and Airbus, the next few months could be critical in reshaping the business and ensuring that retain the scale of clients they have been familiar with over the years.
