Boeing workers voted overwhelmingly to reject the contract and strike
Boeing machinists voted to strike after rejecting a 25% wage increase over four years
Workers at Boeing voted Thursday to go on strike, setting back the planemaker whose reputation and finances have been battered and now facing the shutdown of production of its best-selling airliner.
The International Association of Machinists and Aerospace Workers said its members rejected the contract that would have increased wages by 25% over four years, and they voted 94.6% to reject the contract and 96% voted to strike. A two-thirds vote of the 33,000 workers was needed to strike.
“This is about respect, this is about the past, and this is about fighting for our future,” IAM District 751 President Jon Holden said in announcing the vote.
Very little has gone right for Boeing this year, from a panel blowing off and leaving a hole in one of its passenger planes in January to NASA leaving two astronauts in space rather than send them home on a troubled Boeing spacecraft.
As long as the strike continues, it will deprive Boeing of much-needed revenue from delivering new planes to airlines. That will be another challenge for new CEO Kelly Ortberg, who six weeks ago was tasked with turning around a company that has lost more than $25 billion over the past six years and followed European rival Airbus.
Ortberg warned marchers that a strike vote would jeopardize Boeing’s recovery and cast more doubt on the company in the eyes of its airline customers.
The workers were in no mood to listen.
Ortberg made a last-ditch effort to avoid a strike, telling mechanics Wednesday that “no one wins” in the walkout.
“At Boeing, it’s no secret that our business is in difficult times, in part because of our past mistakes,” he said. “By working together, I know we can get back on track, but a strike could jeopardize our recovery together, destroy trust in our customers and disrupt our ability to decide our future together.”
Many members of the union filed complaints about the agreement throughout the week on social media. On Thursday, several blew whistles, beat drums and held up signs calling for a strike as they marched to a union hall near the Boeing 737 Max plant in Renton, Washington.
“As you can see, the unity is there,” said Chase Sparkman, a quality assurance worker. “I expect our brothers and sisters in the union to stand shoulder to shoulder, hold hands, and let our company know that, hey, we deserve more.”
Mechanics make $75,608 a year on average, not counting overtime, and that can rise to $106,350 at the end of a four-year contract, according to Boeing.
However, the agreement fell short of the union’s initial demand for a 40% wage increase over three years. The union also sought to restore traditional pensions that were eliminated a decade ago but ruled out increasing Boeing’s contributions to workers’ 401(k) retirement accounts.
Although the bargaining committee negotiating the contract recommended it be approved, Holden predicted earlier this week that workers would vote to strike.
Boeing employee Adam Vogel called the 25% raise “a heavy burden. We haven’t had a raise in 16 years.
Broderick Conway, another quality assurance worker and 16-year Boeing employee, said the company could afford more.
“Many members were upset with our initial request. We hope that the second request is the one we are looking at,” he said. “If not … we will continue to strike and be independent.”
The head of Boeing’s aviation business, Stephanie Pope, tried earlier this week to dissuade workers from thinking the strike would lead to a better deal.
“We have consulted in full honesty with the IAM team to represent you and your interests,” he said. “Let me be clear: We did not keep our eye on the second vote.”
Voting began at 5 a.m. local time at union halls in Washington state, Portland, Oregon, and breaking into other locations.
The strike will halt production of the 737 Max, the company’s best-selling aircraft, as well as the 777 or “triple-seven” and the 767 freighter at factories in Everett and Renton, Washington, near Seattle. It likely won’t affect Boeing 787 Dreamliners, which are built by non-union workers in South Carolina.
TD Cowen aviation analyst Cai von Rumohr said it is reasonable based on Boeing’s history of strikes to expect the walkout to continue until mid-November, when workers’ $150 weekly payments from the union’s strike fund could be seen as low as the holidays roll in.
A prolonged strike could cost Boeing as much as $3.5 billion in cash flow because the company receives about 60% of the sale price when it delivers the plane to the buyer, von Rumohr said.
Union negotiators unanimously recommended that workers ratify the tentative agreement reached over the weekend.
Boeing has promised to build its next new airplane in the Puget Sound area. That plane — not expected until sometime in the 2030s — will replace the 737 Max. That was an important win for union leaders, who want to avoid a repeat of Boeing’s production of Dreamliners from Everett to South Carolina.
Holden told members Monday that the union had gotten everything it could in negotiations and recommended ratifying the agreement “because we can’t guarantee we can get more out of the strike.”
However, many union members are still unhappy about the pension, health care and wage agreements.
“They are sad. There are many things they want. I think Boeing understands that and wants to satisfy a fair amount of them,” said von Rumohr, an aerospace analyst. “The question is, will they do enough?”
Boeing has seen its reputation damaged since the crashes of two 737 Max planes in 2018 and 2019, killing 346 people. The safety of its products was re-examined after the team exploded the Max during a flight in January.
By David Koenig and Manuel Valdes, Associated Press. Koenig reported from Dallas.
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