Boeing workers end a financially devastating 7-week strike, accepting a new contract that promises over 40% wage increases amid ongoing company troubles.
At a Glance
- Boeing’s largest union approves new contract, ending a 7-week strike
- Contract includes 43% wage increase over four years and $12,000 bonus
- Strike significantly impacted Boeing’s production and financial health
- Agreement comes as Boeing faces regulatory scrutiny and financial losses
- Workers can return as early as Wednesday, November 8
Boeing Workers Approve New Contract, Ending Costly Strike
Boeing’s largest union has voted to approve a new contract, bringing an end to a seven-week strike that has been one of the most financially damaging work stoppages in decades. The International Association of Machinists and Aerospace Workers, representing about 33,000 workers primarily in the Seattle area, endorsed the contract with 59% of voting members in favor. This resolution comes at a crucial time for Boeing, as the company grapples with ongoing financial turbulence and regulatory challenges.
The strike, which began on September 13 after workers rejected Boeing’s initial proposal, had a substantial impact on the company’s production capabilities. It affected the manufacture of key aircraft models, including the 737 MAX, 767, and 777, further exacerbating Boeing’s financial woes. The company reported a staggering $6.1 billion loss in the third quarter and conducted a $21.1 billion stock offering to bolster its cash reserves.
Contract Details and Worker Benefits
The new contract represents a significant improvement over Boeing’s initial offer. It includes a cumulative wage increase of over 43% over four years, a substantial jump from the original proposal of just over 27%. Additionally, workers will receive a $12,000 bonus package. While the old pension plan was not restored, the company agreed to increase contributions to the 401(k) plan.
“You stood strong, you stood tall and you won. This is a victory,” IAM union local president Jon Holden said.
He hailed the agreement as a victory for the workers and emphasized the need to resume production. The contract also includes a commitment from Boeing to build its next aircraft in the Seattle area, a move that could help secure jobs in the region for years to come.
Boeing’s Challenges and Future Outlook
Despite this positive development, Boeing still faces significant challenges. It remains under intense regulatory scrutiny for its manufacturing practices and safety standards following several high-profile incidents – including the grounding of more than 100 Boeing 737 Max 9 aircraft earlier this year after a door blew off a plane during take-off in Oregon.
“There is much work ahead to return to the excellence that made Boeing an iconic company,” Boeing CEO Kelly Ortberg said.
Market Response and Industry Impact
The market responded positively to news of the strike’s end, with Boeing shares rising by 1.9% in pre-market trading. However, the long-term impact of the work stoppage on Boeing’s financial health and market position is not yet clear. The strike affected not only Boeing but also its airline customers, with companies like Ryanair adjusting their growth forecasts due to delays in aircraft deliveries.
President Biden congratulated Boeing workers for the deal and said, “Over the last four years, we’ve shown collective bargaining works. Good contracts benefit workers, businesses, and consumers—and are key to growing the American economy from the middle out and the bottom up.”
