Boeing's new contract agreement proposes a 35% pay raise over four years, but the workers are not convinced.
On Wednesday, October 23rd, Eastern Time, the Boeing union stated that 64% of the workers voted against the agreement and will continue the strike. This decision puts Boeing's production lines in the Seattle area at further risk of halting, affecting the majority of aircraft production.
This无疑是对波音资金链的雪上加霜，该公司在同日早些时候报告称，公司第三季度亏损超过60亿美元，为2020年以来最大亏损。Standard & Poor's Global Ratings said that the strike is costing Boeing about $1 billion per month and putting the company's investment-grade credit rating at risk, which would increase its borrowing costs for Boeing, which is eager to raise funds.
IAM District 751 union president Jon Holden said at a press conference on Wednesday evening, "We have made significant progress in this agreement, but the new contract is not good enough to satisfy the workers, so they will continue to negotiate."
Boeing's new CEO, Kelly Ortberg, said that his top priority is to reach an agreement with the workers to get everyone back to work and improve the company's situation. Ortberg has proposed plans for Boeing's future, including streamlining the company's size to focus on core businesses. Earlier this month, he announced that Boeing would lay off 10% of its 170,000 global employees.
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The strike is set to last for more than five weeks.
This strike, which began on September 13th, is the first strike by Boeing's more than 32,000 workers since 2008, when they were dissatisfied with a proposed 25% pay raise. The reason was the increasing cost of living in the Puget Sound area, and they had hoped for a 40% pay raise.
Despite Boeing and the union reaching a preliminary agreement on a labor agreement last Saturday, offering workers a new contract that includes a 35% pay raise over the next four years, increased contributions to retirement plans, and a $7,000 bonus, among other benefits, some workers are still dissatisfied because the latest proposal does not offer a pension, and some workers are unhappy about losing their pension plan in the previous contract they signed in 2014.
However, Ben Tsocano, director of Standard & Poor's Global Ratings, said that because the workers do not agree with the new contract, the strike could drag on for a long time, and due to the high costs, it is unlikely that the company will agree to provide a pension.The strike is also a headache for Boeing's major customers, as it further delays the delivery times for many of Boeing's clients. The CEO of American Airlines, Robert Isom, said in an interview with CNBC on Thursday that he hopes to reach a day when Boeing's issues are no longer a nuisance, as they have been grappling with these problems for the past five years. We need them to deliver high-quality aircraft on time, and American Airlines expects to achieve its production plan next year; I am looking forward to Boeing calling to say they can do this.
The long-term shutdown is also a challenge for the aerospace supply chain, as the supply chain has not fully recovered after the pandemic, and Boeing's numerous suppliers need to hurry to train new employees. When Boeing's workers began to strike, Boeing was trying to produce more aircraft, busy increasing the production of 737 planes and other models.
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