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    • No end for Boeing labor strike as workers reject latest contract proposal

    Bartley Stokes Sr., who has worked for Boeing for 46 years, encourages other employees on strike to vote no on a new contract offer from the company Wednesday, Oct. 23, 2024, at a voting location in the Angel of the Winds Arena in Everett, Wash. (AP Photo/Lindsey Wasson) Bartley Stokes Sr., who has worked for Boeing for 46 years, encourages other employees on strike to vote no on a new contract offer from the company Wednesday, Oct. 23, 2024, at a voting location in the Angel of the Winds Arena in Everett, Wash. (AP Photo/Lindsey Wasson)
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    Boeing factory workers voted against the company鈥檚 latest contract offer and remain on the picket lines six weeks into a strike that has stopped production of the aerospace giant鈥檚 bestselling jetliners.

    Local union leaders in Seattle said 64 per cent of members of the International Association of Machinists and Aerospace Workers who cast ballots Wednesday voted against accepting the contract offer.

    鈥淎fter 10 years of sacrifices, we still have ground to make up, and we鈥檙e hopeful to do so by resuming negotiations promptly,鈥 Jon Holden, the head of the IAM District 751 union, said in a statement Wednesday evening. 鈥淭his is workplace democracy 鈥 and also clear evidence that there are consequences when a company mistreats its workers year after year."

    A spokesperson for Boeing said officials didn鈥檛 have a comment on the vote.

    The labour standoff comes during an already challenging year for Boeing, which became the focus of multiple federal investigations after a door panel blew off a 737 Max plane during an Alaska Airlines flight in January.

    The strike has deprived the company of much-needed cash that it gets from delivering new planes to airlines. On Wednesday, the company reported a third-quarter loss of more than US$6 billion.

    Union machinists assemble the 737 Max, Boeing鈥檚 best-selling airliner, along with the 777 or 鈥渢riple-seven鈥 jet and the 767 cargo plane at factories in Renton and Everett, Washington.

    The latest rejected offer included pay raises of 35 per cent over four years. The version that union members rejected when they voted to strike last month featured a 25 per cent increase over four years.

    The union, which initially demanded 40 per cent pay boosts over three years, said the annual raises in the revised offer would total 39.8 per cent, when compounded.

    Boeing has said that average annual pay for machinists is currently US$75,608.

    Boeing workers told Associated Press reporters that a sticking point was the company鈥檚 refusal to restore a traditional pension plan that was frozen a decade ago.

    鈥淭he pension should have been the top priority. We all said that was our top priority, along with wage,鈥 Larry Best, a customer-quality coordinator with 38 years at Boeing, said on a picket line outside a Boeing factory in Everett, Washington. 鈥淣ow is the prime opportunity in a prime time to get our pension back, and we all need to stay out and dig our heels in.鈥

    Theresa Pound, a 16-year Boeing veteran, also voted against the deal. She said the health plan has gotten more expensive and her expected pension benefits would not be enough, even when combined with a 401(k) retirement account.

    鈥淚 have put more time in this place than I was ever required to. I have literally blood, sweat and tears from working at this company,鈥 the 37-year-old said. 鈥淚鈥檓 looking at working until I鈥檓 70 because I have this possibility that I might not get to retire based on what鈥檚 happening in the market.鈥

    The strike started Sept. 13 and has served as an early test for Boeing CEO Kelly Ortberg, who became chief executive in August.

    In his first remarks to investors, Ortberg said earlier Wednesday that Boeing needs 鈥渁 fundamental culture change,鈥 and he laid out his plan to revive the aerospace giant after years of heavy losses and damage to its reputation.

    Ortberg repeated in a message to employees and on the earnings call that he wants to 鈥渞eset鈥 management鈥檚 relationship with labour 鈥渟o we don鈥檛 become so disconnected in the future.鈥 He said company leaders need to spend more time on factory floors to know what is going on and 鈥減revent the festering of issues and work better together to identify, fix, and understand root cause.鈥

    Ortberg, a Boeing outsider who previously ran Rockwell Collins, a maker of avionics and flight controls for airline and military planes, said Boeing is at a crossroads.

    鈥淭he trust in our company has eroded. We鈥檙e saddled with too much debt. We鈥檝e had serious lapses in our performance across the company, which have disappointed many of our customers,鈥 he said.

    But Ortberg also highlighted the company鈥檚 strengths, including a backlog of airplane orders valued at a half-trillion dollars.

    鈥淚t will take time to return Boeing to its former legacy, but with the right focus and culture, we can be an iconic company and aerospace leader once again,鈥 he said.

    In recent weeks, Ortberg announced large-scale layoffs 鈥 about 17,000 people 鈥 and a plan to raise enough cash to avoid a bankruptcy filing.

    Boeing hasn鈥檛 had a profitable year since 2018, and Wednesday鈥檚 numbers represented the second-worst quarter in the manufacturer鈥檚 history. Boeing lost US$6.17 billion in the period ended Sept. 30, with an adjusted loss of US$10.44 per share. Analysts polled by Zacks Investment Research had expected a loss of US$10.34 per share.

    Revenue totaled US$17.84 billion, matching Wall Street estimates.

    The company burned nearly US$2 billion in cash, in the quarter, weakening its balance sheet, which is loaded down with US$58 billion in debt. Chief Financial Officer Brian West said the company will not generate positive cash flow until the second half of next year.

    Boeing鈥檚 fortunes soured after two of its 737 Max jetliners crashed in October 2018 and March 2019, killing 346 people. Safety concerns were renewed this January, when a panel blew off a Max during an Alaska Airlines flight.

    Ortberg needs to convince federal regulators that Boeing is fixing its safety culture and is ready to boost production of the 737 Max 鈥 a crucial step to bring in much-needed cash. That can鈥檛 happen, however, until the striking workers return to their jobs.

    Early in the strike, Boeing made what it termed its 鈥渂est and final鈥 offer. The proposal included pay raises of 30 per cent over four years, and angered union leaders because the company announced it to the striking workers through the media and set a short ratification deadline.

    Boeing backed down and gave the union more time. However, many workers maintained the offer still wasn鈥檛 good enough. The company withdrew the proposed contract on Oct. 9 after negotiations broke down, and the two sides announced the latest proposal on Saturday.

    Charles Fromong, a mechanic who has worked at Boeing for 38 years, said Wednesday night after the results were announced that the company needs to take care of its workers.

    鈥淚 feel sorry for the young people,鈥 he said. 鈥淚鈥檝e spent my life here and I鈥檓 getting ready to go, but they deserve a pension and I deserve an increase.鈥

    The last Boeing strike, in 2008, lasted eight weeks and cost the company about US$100 million daily in deferred revenue. A 1995 strike lasted 10 weeks.

    Koenig reported from Dallas. Lindsey Wasson in Everett, Washington, contributed to this report.

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