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Boeing faces possible strike as workers prepare to hold key vote on contract deal

Published 09/12/2024, 05:22 AM
© Reuters
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Investing.com -- Boeing (NYSE:BA) could be facing a strike as soon as Friday should more than 30,000 of the planemaker's workers in the US Pacific Northwest vote to begin a work stoppage and reject a tentative labor deal.

The company had previously reached a tentative agreement for a 25% pay bump and a $3,000 signing bonus, along with a commitment to building a new plane in the Pacific Northwest, better retirement benefits and an increase to the union's input into jet quality.

However, the employees in the states of Washington and Oregon, who are represented by the International Association of Machinists District 751, are likely to reject the deal on Thursday, according to media reports. Workers are reportedly asking for bigger wage increases and other improvements to the agreement.

Speaking to Reuters, the head of negotiations for the union, Jon Holden, said that workers are "angry" over "many of the issues that they care deeply about."

If they choose to vote against the deal, the workers would then hold a second ballot to decide whether to go on strike.

A labor action would ratchet up scrutiny on new Boeing Chief Executive Kelly Ortberg, who is currently attempting to improve Boeing's finances and rebuild its reputation after dangerous mid-air door plug breach in January. Ortberg has warned workers that a strike would put that recovery "in jeopardy," according to a staff message quoted by several media sources.

"I ask you not to sacrifice the opportunity to secure our future together, because of the frustrations of the past," Ortberg added, the reports said.

A 50-day strike could dent Boeing's cash flow by $3 billion to $3.5 billion, according to analysts at TD Cowen. A prior strike in 2008 led to revenue losses worth an estimated $100 million per day.

Reuters contributed to this report.

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