Boeing Workers' Vote on New Labor Contract

Boeing workers are voting on a new labor contract on Thursday, setting the stage for a potential strike that could cripple the struggling aircraft maker. The company's CEO, Kelly Ortberg, has warned that a strike would jeopardize Boeing's recovery.

• The tentative agreement, reached on Sunday, includes a 25% wage increase over four years and improved healthcare and retirement benefits.
• The International Association of Machinists and Aerospace Workers (IAM) and Boeing have been negotiating for months.
• Some workers are unhappy with the tentative agreement and are seeking bigger wage increases, citing the high cost of living in the Seattle area.

Boeing's CEO Addresses Workers

Ortberg, who took over as CEO in August, has been trying to reassure workers that a strike would be detrimental to the company's future.

• He has visited Boeing's factories in Renton and Everett, Washington, to discuss the contract with employees.
• Ortberg has emphasized the importance of reaching a deal that will help Boeing recover from recent challenges, including safety lapses and quality flaws.

Impact of a Potential Strike

A strike by Boeing workers could have a significant impact on the company and the aerospace industry.

• Jefferies aerospace analyst Sheila Kahyaoglu estimates that a 30-day strike could cost Boeing $1.5 billion.
• A strike could also disrupt Boeing's supply chain and lead to delays in aircraft production.

Union's Demands and Boeing's Response

The IAM, which represents about 33,000 Boeing workers, had initially sought a 40% pay increase.

• The 25% increase in the tentative agreement is in line with recent union-negotiated pay increases in other industries.
• Boeing has argued that the proposed wage increases are fair and sustainable.

Details of the Tentative Agreement

The tentative agreement includes several provisions that aim to improve workers' compensation and benefits.

• The agreement includes a 25% wage increase over four years, with an average annual pay increase of 6.25%.
• The agreement also includes improved healthcare and retirement benefits.
• Boeing has also committed to building its next aircraft in the Seattle area, after it moved production of the 787 Dreamliner to a non-union factory in South Carolina.

Previous Strikes and the Current Negotiation

This is the first time Boeing workers have voted on a new contract since 2008.

• The IAM and Boeing have had a long history of labor negotiations, including several strikes in the past.
• The current negotiations are taking place against the backdrop of Boeing's efforts to recover from recent challenges and the ongoing labor unrest in other industries.

Potential Consequences of the Vote

The outcome of the vote will have significant implications for Boeing, its workers, and the aerospace industry.

• If the tentative agreement is rejected, and two-thirds of workers vote in favor of a strike, a work stoppage would begin after midnight on Friday.
• If less than two-thirds of workers vote to strike after the contract is rejected, the contract would automatically go into effect.

Boeing's Future and the Importance of a Deal

Ortberg has said that a strike would jeopardize Boeing's recovery and hurt its ability to compete in the global aerospace market.

• Boeing has been struggling to recover from recent challenges, including production delays, safety issues, and the grounding of its 737 Max aircraft.
• A strike would further damage Boeing's reputation and could lead to more delays in aircraft production.
• Both Boeing and its workers have a vested interest in reaching a fair and sustainable agreement.