A strike by Boeing factory workers shows no signs of ending after its first week
A strike at Boeing Friday showed no signs of ending as the strike by 33,000 union machinists entered the eighth day and the company began rolling leaves of non-union workers to save money.
Federal mediators joined talks this week between Boeing and the International Association of Machinists and Aerospace Workers, but company and union officials said little progress was made during the first two sessions.
“While we are disappointed that the discussions did not result in greater progress, we remain committed to reaching an agreement as soon as possible that recognizes the hard work of our employees and ends the work stoppage in the Pacific Northwest,” Boeing CEO Kelly Ortberg said in a message to employees.
The union said no further talks are planned.
The strike began on September 13, when members of a regional district of the IAM union 96% voted in favor of a strike after rejecting a proposed contract that would have increased their salaries by 25 percent over four years. Workers say they want a 40 percent raise and a restoration of traditional pension benefits that were cut about a decade ago.
Union leaders, who recommended approving the contract offer, quickly pivoted and surveyed union members to find out what they wanted from a new contract.
The Federal Mediation and Conciliation Service met with both parties on Tuesday and Wednesday, but the mediation ended without a solution.
“While we are open to further discussions, either directly or through mediation, no additional dates are scheduled at this time,” IAM District 751 officials said.
The strike mainly affects workers at factories in the Puget Sound area of Washington state, and will quickly affect Boeing’s balance sheet. The company gets a large portion of its money when it delivers new planes. The strike has production stopped of the 737s, 777s and 767s that Boeing delivered at a rate of nearly one per day.
Ortberg, who became CEO of the aerospace giant earlier last month, announced this week that the company money saving steps would also include managers and other non-union members who are temporarily not affiliated with a union.
Terry Muriekes, a 38-year Boeing employee, protested outside the Everett, Washington, assembly plant where the 777s and 767s are built, pointing to the ongoing furloughs.
“I’ve never seen Boeing do that before. They’re maybe feeling the pinch, feeling the pain a little bit, you know — trying to save some money after spending so much money on four CEOs in 10 years who all walked away with multiple golden handshakes,” said Muriekes, who has been through four previous strikes at Boeing, including the last one, in 2008. “The company is doing what it has to do, I think.”
Nearby, Bill Studerus, a 39-year Boeing veteran, carried a “Strike” sign and an American flag.
“When you strike, you have no income, so that’s what’s challenging for all of us, regardless of your age,” Studerus said. “My heart tells me that hopefully this will be over soon. I mean, we all want to get back to work and we all want to be the Boeing family that we’ve always been.”
Boeing’s cost-cutting measures, which include a hiring freeze, travel restrictions and a 25% pay cut for top executives, affect the company’s aircraft manufacturing, defense and space operations, and global services.
Tens of thousands of non-union workers will be forced to take an unpaid week off every four weeks under the furlough plan. Ortberg said safety, quality and customer service activities would continue, as would production of the 787 Dreamliner, a large aircraft built by non-union workers in South Carolina.
The Society of Professional Engineering Employees in Aerospace said its board rejected a request by the company to include the 19,000 Boeing workers it represents in the furloughs. President John Dimas said the union — Boeing’s second-largest after the IAM — saw no compelling reason to change the contract, which prohibits furloughs.
“To restore balance, Boeing must make the striking engineers an offer that ends the current dispute and puts them back to work,” Dimas said.
Concerns about a cash shortage are prompting credit rating agencies to consider downgrading Boeing’s credit rating to non-investment or junk status, a move that would embarrass Boeing and increase borrowing costs.
Boeing had $58 billion in debt and $11 billion in cash as of June 30, according to a regulatory filing. Chief Financial Officer Brian West said the company burned through $4.3 billion in the second quarter. The company delivered 83 commercial jets in July and August, nearly as many as it delivered in the entire second quarter, but that accelerated pace will stall if the strike lasts much longer.
___
Manuel Valdes in Everett, Washington, contributed to this report.