On October 15, 2024, a strike was ongoing in Seattle, Washington, USA. Boeing workers from District 751 of the International Association of Machinists and Aerospace Workers participated in a rally held at the union hall.
David Ryder | Reuters
boeing company Mechanics vote against new labor agreement Their union said on Wednesday it included a 35% wage increase over four years, extended by more than five weeks. strike Most of the company’s aircraft production, centered in the Seattle area, has been halted.
The contract was rejected by 64% of voters, another major setback for the company, which warned earlier on Wednesday that it would continue to Burn cash before 2025 It also announced a quarterly loss of US$6 billion, the largest loss since 2020. The contract requires a simple majority vote to pass.
The strike is costing the company about $1 billion a month, according to S&P Global Ratings, and puts Boeing’s investment-grade credit rating at risk, which could push up borrowing costs as it seeks to raise cash.
New CEO Kelly Ortberg has said reaching a deal with mechanics is a top priority in getting the company back on track after years of safety and quality problems.
“My focus is on getting everyone moving forward, getting them back to work and improving that relationship,” Ortberg told CNBC.quack in the street“Earlier in the day, when asked about the strike.
Ortberg laid out his vision for Boeing’s future, which could include downsizing the company and focusing on its core businesses. Earlier this month, he announced that Boeing wouldl 10% layoffs globally 170,000 people.
The Biden administration has stepped in during the shutdown, with acting Labor Secretary Julie Su meeting with Boeing and unions before making the latest proposal last week.
“Both sides need to determine the best way forward,” a Labor Department spokesman said Thursday. “Secretary Sudai has been in contact with the union and the company and is willing to provide support to them.”
Boeing workers from International Association of Machinists and Aerospace Workers District 751 arrive at the union hall to vote on a new contract proposal during an ongoing strike on October 23, 2024 in Renton, Washington, USA.
David Ryder | Reuters
Boeing’s more than 32,000 machinists in the Puget Sound region, Oregon and elsewhere voted overwhelmingly to reject a previously proposed tentative deal for a 25% pay increase and went on strike on September 13. The International Association of Machinists and Aerospace Workers initially sought a 40% wage increase. This is the first strike by mechanics since 2008.
The strike further delayed deliveries for many Boeing customers, who face production delays not only at Boeing but also at rival Airbus.
“I look forward to the day when they are no longer just a distraction.” American Airlines CEO Robert Isom told CNBC “scream box“Thursday. “We’ve been fighting them for the last five years. “
Ortberg met with Isom and other major airline CEOs when he took over in August.
“We need them to deliver quality aircraft on time,” Isom said, adding that American expected to meet its capacity plans for next year. “When Boeing says they’re going to do this, I’ll welcome the call.”
Boeing’s latest proposal, announced on Saturday, includes a 35% pay increase over four years, increased 401(k) contributions, a $7,000 bonus and other improvements.
Workers are demanding higher wages as the cost of living soars in the Puget Sound region. Some mechanics were upset about losing the pension plan under the last contract signed in 2014, but the latest proposal does not provide for pensions.
“If the barrier is reinstating pensions, then refusing increases the risk of a protracted strike,” Ben Sokanos, head of aerospace at S&P Global Ratings, said in a statement, adding that the company was unlikely to agree to pensions. , because of its cost.
Boeing also agreed in the new contract to build its next plane in the Pacific Northwest, which has also become a sticking point for union workers after the company moved all of its 787 Dreamliner production to a non-union factory in South Carolina. .
“We achieved great results in this agreement. However, what we achieved is not sufficient to meet the demands of our members,” IAM District 751 President Jon Holden said at a news conference Wednesday night. He said the union would push for a return to the bargaining table.
Boeing declined to comment on the outcome of the vote.
The labor dispute is the latest in a long list of problems for Boeing. Earlier this year, a door jam on Boeing’s best-selling plane, the 737 Max 9, exploded in mid-air, reigniting regulatory scrutiny of the company.
The strike began as Boeing was working to increase production of its 737 and other aircraft.
The prolonged shutdown is also a challenge for the aerospace supply chain, which has been made vulnerable by the pandemic as the company’s network of suppliers must quickly train new workers.
spirit aerospace systems inc.Boeing is acquiring the company, it said last week will be temporarily on leave There are about 700 workers who could be laid off or otherwise furloughed if the Boeing machinists’ strike continues.
