DALLAS — At a pivotal moment for Boeing, CEO Kelly Ortberg intervened in negotiations with the machinists union this week, issuing a tough ultimatum.
Assume that union members reject the company’s current contract offer in a future vote. In that case, future offers may be less favorable and may affect the company’s commitment to future projects and the employee’s financial interests.
John Holden, president of Machinists Union District 731, said Boeing’s position is clear: “The next proposal is going to be regressive,” including potential wage increases, medical benefits and cuts to local production plans. It suggests sex.
Boeing’s latest proposal includes a 38% pay increase over four years, including an additional 3% raise on top of its previous proposal. “This is a life-changing wage,” Holden noted, emphasizing the unprecedented nature of this increase.
According to the Seattle Times, the union’s bargaining committee recommended that members accept the offer, calling it a hard-won victory and increasing production of Boeing’s best-selling jets at its Renton and Everett plants. It is said that he urged the end of the 54-day strike that halted the plant.
7 weeks loss
The strike deprived Boeing of the cash it needed to deliver new aircraft, resulting in significant direct economic losses for U.S. manufacturers.
The estimated total cost of the strike reached US$1.4 billion by September 27, 2024, approximately two weeks after the strike began. Of this total, approximately US$1.1 billion was borne by Boeing shareholders. Direct costs to Boeing employees were estimated at approximately $207 million. By mid-October, the direct financial impact of the first month of the strike had reached US$5 billion, of which US$3.26 billion directly affected Boeing.
Boeing’s financial results reflect the severe impact of the strikes.
The company reported a loss of more than $6 billion in the third quarter. This equates to the second-worst quarter in the manufacturer’s history. Boeing burned nearly $2 billion in cash during the quarter.
end of rope
Ortberg’s direct approach underscores the urgent need for a mutual agreement as Boeing’s cash reserves tighten. The union’s bargaining committee also sees last Thursday’s IAM-Boeing contract offer as the best path forward.
Voting will take place on Monday, November 4, 2024, the day before the presidential election takes control of the country.
According to a tweet from IAM Union District 751, there will be one vote to accept or reject the bargaining agreement. A simple majority of voters (50% + 1) determines the outcome.
If the vote passes, members who wish to return as soon as possible will be able to return to work “as early as the first shift on Wednesday, November 6, 2024.”
If all goes well, all striking workers will be back at work by the start of work on Tuesday, November 12, 2024.
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