Negotiations have broken down again! Boeing (BA.US) withdraws 30% pay raise proposal: Further negotiations are pointless at this point

Boeing's (BA.US) negotiations with the International Association of Machinists and Aerospace Workers to end the strike have again broken down, indicating that the strike, which has lasted nearly a month, will continue and that key manufacturing plants for the company's commercial aircraft on the West Coast of the U.S. will remain closed. The talks broke down on Tuesday and Wednesday, with Boeing and IAM blaming each other for the impasse, according to people familiar with the matter. Boeing said it had withdrawn the proposal and that there was no point in further negotiations. "Our team has been sincere in our negotiations and has presented new and improved proposals in an effort to reach an agreement, including increased base pay and retirement," Stephanie Pope, head of Boeing's commercial aircraft unit, said. "Unfortunately, the union has not seriously considered our proposals. The union's demands are non-negotiable and far beyond what is acceptable to maintain the company's competitiveness." However, IAM said its negotiating committee was ready to continue mediation or direct negotiations with Boeing. The union is seeking a 40% pay raise over four years and the reinstatement of a defined-benefit pension plan, which was eliminated in the last contract, according to people familiar with the matter. More than 90% of workers voted against a 25% pay raise over four years proposed by Boeing before the strike began. Boeing then offered a 30% pay raise over four years, along with the reinstatement of performance-based bonus plans, but the union rejected the offer. About 33,000 workers at Boeing's West Coast factories began striking early on Sept. 13, the first major strike at the company in 16 years. The strike has already hurt the company's financial condition, according to estimates from investment bank TD Cowen, which said Boeing's daily revenue loss could be as high as $1 billion. In addition, the company is on the verge of losing its prized investment-grade credit rating and has implemented temporary furloughs for thousands of salaried employees. Earlier on Tuesday, it was reported that Boeing was considering issuing at least $10 billion in new shares as it struggles to deal with the financial impact of the strike.