Ahead of a pivotal vote on a union contract, Boeing Co. workers and supporters gathered outside the Aerospace Machinists Union District 751 Hall in Renton, Washington, on Thursday. More than 30,000 Boeing employees had planned to strike on Friday, following an overwhelming rejection of a new labor contract. This strike will disrupt the production of most Boeing aircraft, a costly setback for a company already battling to scale up production and recover its reputation after safety crises.
The workforce, based in the Seattle area and Oregon, voted 94.6% against the tentative agreement proposed by Boeing and the International Association of Machinists and Aerospace Workers. Additionally, 96% voted in favor of striking, exceeding the two-thirds threshold needed for a work stoppage. IAM District 751 President Jon Holden announced the strike, labeling it an “unfair labor practice strike” and citing issues such as “discriminatory conduct” and “unlawful surveillance” by Boeing. He urged the company to engage in good-faith negotiations.
Boeing has not yet responded to these developments.
The proposed contract offered a 25% wage increase along with better healthcare and retirement benefits. However, the union demanded approximately 40% raises and voiced concerns that the agreement inadequately addressed the rising cost of living. This vote is a significant setback for CEO Kelly Ortberg, who had led the company for just five weeks and urged acceptance of the contract to avoid jeopardizing Boeing’s recovery.
The strike’s financial impact hinges on its duration, with Jefferies aerospace analyst Sheila Kahyaoglu estimating a potential $1.5 billion cash impact if the strike lasts 30 days. Production disruptions could also destabilize suppliers and supply chains. Boeing’s financial struggles include an $8 billion cash burn this year and rising debt, compounded by manufacturing flaws, supply issues, and labor shortages. Additionally, a blowout of a nearly new Boeing 737 Max 9 at the beginning of the year has drawn further federal scrutiny.
Original Story https://www.cnbc.com/2024/09/13/boeing-workers-strike-reject-contract.html
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