Boeing workers reject contract, strike drags on
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The news: Boeing’s largest machinist union rejected a revised contract proposal, extending their six-week strike and intensifying the aerospace company’s financial struggles.
The numbers: With 64% of union members voting against the deal, Boeing's factories for its key jet models will remain idled, costing the company around USD1 billion a month, according to analysts quoted by The Wall Street Journal.
The rejected contract included a 35% wage increase over four years, a USD7,000 ratification bonus, and increased 401(k) contributions, but failed to restore pensions—a key union demand.
The context: The second rejection comes after machinists resoundingly rejected the company’s first offer of a 25% pay increase. The strike is stopping production of key models like the 737 Max. On the same day the offer was rejected, Boeing reported a USD6.2 billion loss for the third quarter of 2024.
Analysts are warning of a possible credit downgrade to junk status if the strike drags on. CEO Kelly Ortberg acknowledged deep company challenges beyond the strike, as accumulated losses top USD30 billion since 2019 and amid ongoing plans to cut 17,000 jobs. He said Boeing needed a cultural shift to restore its reputation.
What they said: “After 10 years of sacrifices, we still have ground to make up, and we’re hopeful to do so by resuming negotiations promptly. This is workplace democracy – and also clear evidence that there are consequences when a company mistreats its workers year after year,” union leaders said in a statement.
“Ten years of holding workers back unfortunately cannot be undone quickly or easily, but we will continue to negotiate in good faith until we have made gains that workers feel adequately make up for what the company took from them in the past.”
