Boeing, Union Hold ‘Productive’ Talks in Attempt to End Strike
Wednesday, Oct 30, 2024 1:51 am ET
1min read In a significant development, Boeing and the International Association of Machinists (IAM) have engaged in productive talks to resolve the ongoing strike, which has crippled the company's aircraft production for over a month. The strike, involving 33,000 machinists, has brought Boeing's commercial airplane production to a near halt, exacerbating the company's financial woes.
The strike, which began on September 13, has been an early test for Boeing's new CEO, Kelly Ortberg. Ortberg, a Boeing outsider who took the helm in August, has been laser-focused on ending the strike to stabilize the company's business and fix its safety culture. The strike is costing Boeing around $1 billion a month, according to an estimate from Standard & Poor's, on top of its ongoing losses.
Boeing reported a staggering $6.2 billion net loss in the third quarter, largely due to a $3 billion charge related to airline jets and a $2 billion loss for its defense and space programs. The strike has added further uncertainty, costs, and recovery delays, with a 50-day work stoppage projected to cost Boeing $5.5 billion.
The strike has been driven by workers' demands for better wages, job security, and the restoration of a traditional pension plan. The loss of the pension plan, which was frozen a decade ago, has left a deep wound among union members. Despite Boeing's offer of a 35% wage increase over four years, a $7,000 ratification bonus, and improved retirement benefits, the union has held firm on its demand for pension restoration.
The strike has also affected Boeing's competitors, with Airbus likely to benefit from the disruptions in Boeing's production. Analysts expect further concessions on wages to be required for a deal to pass, as financial stress mounts for both Boeing and its workers.
As negotiations continue, both sides remain committed to finding a resolution that works for the company and its employees. The outcome of these talks will not only impact Boeing's financial performance but also influence the broader aerospace industry and labor relations in the sector.
The strike, which began on September 13, has been an early test for Boeing's new CEO, Kelly Ortberg. Ortberg, a Boeing outsider who took the helm in August, has been laser-focused on ending the strike to stabilize the company's business and fix its safety culture. The strike is costing Boeing around $1 billion a month, according to an estimate from Standard & Poor's, on top of its ongoing losses.
Boeing reported a staggering $6.2 billion net loss in the third quarter, largely due to a $3 billion charge related to airline jets and a $2 billion loss for its defense and space programs. The strike has added further uncertainty, costs, and recovery delays, with a 50-day work stoppage projected to cost Boeing $5.5 billion.
The strike has been driven by workers' demands for better wages, job security, and the restoration of a traditional pension plan. The loss of the pension plan, which was frozen a decade ago, has left a deep wound among union members. Despite Boeing's offer of a 35% wage increase over four years, a $7,000 ratification bonus, and improved retirement benefits, the union has held firm on its demand for pension restoration.
The strike has also affected Boeing's competitors, with Airbus likely to benefit from the disruptions in Boeing's production. Analysts expect further concessions on wages to be required for a deal to pass, as financial stress mounts for both Boeing and its workers.
As negotiations continue, both sides remain committed to finding a resolution that works for the company and its employees. The outcome of these talks will not only impact Boeing's financial performance but also influence the broader aerospace industry and labor relations in the sector.
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