Boeing strike continues as workers reject wage deal

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Boeing strike continues as workers reject wage deal

Boeing factory workers voted Wednesday to reject a contract offer and continue a more than five-week strike, a blow to new CEO Kelly Ortberg’s plan to shore up the struggling planemaker’s finances.

The vote was 64% against the deal, which included a 35% pay rise over four years, a major setback for Ortberg who rose to the top job in August by pledging to work more closely with factory workers than his predecessors.

The rejection of Boeing’s offer, which comes after 95% of workers voted against a first contract last month, reflects years of resentment from workers who felt cheated by the company during negotiations there. is ten years old and worsens a financial crisis.

After the vote, union leaders said they were ready to immediately resume negotiations with Boeing in the first major negotiation since 2014, when the company threatened to move production of the new version of the 777 out of the region to pass an agreement that put an end to traditional pensions.

The union is demanding a 40% salary increase and the return of the defined benefit pension.

Boeing factory workers were also expressing frustration after a decade where their wages lagged behind inflation and critics complained that the planemaker spent tens of billions of dollars on buybacks. shares and paid record bonuses to its executives.

“These members have been through a lot…they have deep wounds,” Jon Holden, the union’s lead contract negotiator, told reporters after the vote.

“I want to come back to the table. Boeing needs to come to the table as well. I hope we can have fruitful discussions with the company and with Mr. Ortberg, to try to resolve this issue.”

Boeing declined to comment on the vote.

Some 33,000 machinists downed tools at Boeing factories on the West Coast on September 13. production stoppage of the best-selling programs for the 737 MAX as well as the 767 and 777 wide-body aircraft.

Time is running out for Boeing, historically America’s largest exporter and its largest union, to reach a deal before the busy political period surrounding the Nov. 5 presidential election.

While Boeing and IAM were at an impasse earlier this month, Acting U.S. Labor Secretary Julie Su helped secure the latest offer put on the ballot after attending in-person talks with both parties in Seattle last week.

Holden said after the union vote that he would contact the White House to see if the union could get more help in negotiations with Boeing.

“After the first contract offer was rejected, the honeymoon was over with the workforce reset. This further validates that,” said Scott Hamilton, an aviation consultant.

“This is bad news for everyone: Boeing, workers, suppliers, customers and even the national economy.”

Boeing is the largest customer in a U.S. aerospace supply chain already facing critical financial pressure.

Fuselage supplier Spirit AeroSystems has warned that if the strike continues beyond the end of November, there will be even more drastic layoffs and furloughs.

The company, in the process of being bought by Boeing, has already announced a 21-day leave for 700 employees.

“Defining moment”

Boeing has announced its intention to cut 17,000 jobs and is moving closer to a plan to raise up to $15 billion investors to help it preserve its investment-grade credit rating, while some airlines have had to cut schedules due to aircraft delivery delays.

Ortberg warned Wednesday that there was no silver bullet for the struggling aircraft maker.

In a quarterly results callBoeing projects it will burn cash through 2025. Jefferies analyst Sheila Kahyaoglu said after the vote that the decision to extend the strike could worsen the expected cash drain.

The specter of a quality crisis following the explosion of an in-flight panel in January looms over Boeing.

Richard Aboulafia, chief executive of AeroDynamic Advisory, said it was now the “defining moment” of Ortberg’s short tenure and he needed to get a deal done quickly.

“There’s a feeling he didn’t handle this as well as he could have,” Aboulafia said. “They (Boeing) have to get there, and they are in a weak position.”

The workers’ rejection Wednesday was the second in a formal vote after rejecting the offer of a 25% pay rise over four years last month, leading to the strike.

Many comments on social media and from workers outside polling stations cast doubt on the deal.

“We are ready to resume the strike until we get a better deal,” Irina Briones, 25, said after the vote.

“They took a bunch of numbers and moved them around to make it look like they were giving us more than they were,” said Josh Hajek, 42, who worked six years at Boeing on wing assembly.

Voting figures show the two sides are moving closer to an agreement, but still have a solid majority in favor of extending the strike.

Before the vote, Terrin Spotwood, a 20-year machinist working in 737 wing assembly, said he planned to approve the contract because the offer was “good, but not great.” He said several colleagues had planned the same thing because they “can’t really afford to say no to this contract. They need to get back to work.”

Despite this, many workers are still angry about the last agreement signed a decade ago.

“We’re going to get what we want this time. We’ve got better legs than Boeing this time,” said Donovan Evans, 30, who works at the 767 plane factory near Seattle.

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