(Reuters) – Boeing (NYSE:) said layoffs began on Friday for thousands of employees in Washington state and Oregon after more than 32,000 workers went on strike last week, halting production of the U.S. planemaker’s blockbuster 737 MAX and other jets.
Striking workers from the International Association of Machinists and Aerospace Workers received their final paycheck this week, sources said, as talks between Boeing and its largest union have stalled.
With no sign that Boeing and union negotiators would imminently return to the bargaining table on Friday, both sides took early steps to prepare for a prolonged strike.
Boeing CEO Kelly Ortberg informed employees earlier this week that the company would begin furloughs for a large number of U.S.-based employees who are not part of the strike. Boeing has planned for workers to take one week of leave every four weeks on a rolling basis for the duration of the strike.
The lengthy furloughs show Ortberg is preparing the company to weather a prolonged strike that is unlikely to be easily resolved given anger among rank-and-file workers.
A prolonged labor battle could cost Boeing several billion dollars, further straining its finances and threatening its credit rating, analysts said.