While Raytheon Technologies Corp. CEO Greg Hayes announced the elimination of 15,000 jobs during an investors’ call last week, he also said that the defense part of the business has never been stronger.
He said the company has a backlog of $73 billion in orders for defense-related products, such as missiles. The Andover location on Lowell Street is a missile and defense facility and is known for its contributions to the Patriot Missile program, among many other types of defense technology.
“On the defense side, we continue to grow,” Hayes said, adding that the company is actually hiring 8,200 people in its defense division in the coming year to keep up with the demand.
Last Wednesday he announced that the company would be eliminating 15,000 jobs at its corporate offices, jet engine-maker Pratt & Whitney and aviation and military equipment manufacturer Collins Aerospace amid the downturn in the airline industry resulting from the COVID-19 pandemic.
The company, which has 195,000 employees and sales of $74 billion in 2019, is divided into four, main groups, including Pratt & Whitney and Collins Aerospace, both of which make products for commercial aviation. The other two divisions focus on outer space and missiles and defense.
Both of those divisions are showing tremendous growth, Hayes said.
However, if layoffs are made in corporate offices, as suggested, that could mean job losses in Waltham, the location of the company’s corporate headquarters.
A spokesman for Raytheon, Chris Johnson, said the company was not releasing any information on how the layoffs could affect specific locations.
The job cuts are nearly double the total the company initially announced in July.
Hayes, speaking during a Morgan Stanley analysts conference via webcast, said the cuts amount to administrative cost reductions of about 20% at Pratt & Whitney, based in East Hartford, Connecticut, and about 12% at Collins Aerospace, based in Charlotte, North Carolina.
Pratt & Whitney has seen shop visits decline 60% since the second quarter, and Collins Aerospace saw a 65% drop in commercial spare parts orders, Hayes said, noting global commercial air traffic is currently down about 45%, after an 80% drop in March.
Hayes also noted that the company was reviewing its “high-cost locations” and in the coming months would be studying “which factories make sense long-term” in an attempt to reduce costs.
Hayes said revenues from defense contracts was a “bright spot in the business” and now account for about two-thirds of sales.
Patriot Missiles, and Raytheon’s Andover facility, gained fame and notoriety during the first Gulf War in 1990 when the company was asked to manufacture the missiles at an accelerated pace because they were needed to shoot down Iraq’s Scud missiles in mid-air. The Patriot missiles soon became known as “Scud-busters.”
One media report noted that the Andover facility was working 24 hours a day and seven days a week to build as many Patriot missiles as possible to send to the Persian Gulf to protect military and civilian assets from the Scud missiles.
Hughes also said the company’s space division was also growing and “proving to be very profitable.”
Material from the Associated Press was used in this article.