Boeing workers voted to reject the new deal offered by the company, continuing the months-long strike. This proves a major setback for newly appointed CEO Kelly Ortberg and her plans to improve their struggling finances.
The vote
The latest Boeing deal offered workers a 35% wage increase over 4 years along with a new ratification bonus, reinstated incentive plan, and new retirement plan. The original request from the workers included a 40% wage increase and the reinstatement of the defined-benefit pension. 64% of workers voted against the new deal, further putting pressure on Boeing.
The International Association of Machinists and Aerospace Workers (IAM) union leaders claimed that they are ready to continue negotiations. This will be the first new contract since 2014, when the company ended traditional pensions. Boeing declined to comment on the vote.
Despite the union’s “tremendous gains” during the negotiations, IAM President Jon Holden stated that more work remains to meet their demands.
The demands reflect the workers long-standing dissatisfaction and mistrust of the company. Holden goes on to claim
“This is workplace democracy—and also clear evidence that there are consequences when a company mistreats its workers year after year.”
Impact on Boeing
The strike has been detrimental to Boeing’s financial position as it halted the production of aircraft, including the 777X jets. This has prevented the company from receiving much-needed payments.
Alongside the vote on Wednesday, Boeing revealed its third quarter losses of $6.2 billion.
Kelly Ortberg has publicly stated
“We’re saddled with too much debt. We’ve had serious lapses in our performance across the company, which have disappointed many of our customers.
The company was already experiencing difficulties prior to the strike. It has lost $30 billion since 2019 with multiple scandals, including issues of aircraft safety and quality control.
Ortberg has laid out a plan to turn Boeing around and improve its finances.
He has announced that there will be a 10% reduction in the workforce, along with a plan to raise $15 billion from investors. Ortberg also acknowledges that the plane-maker will need time to recover.
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