On Wednesday, October 23rd, Boeing factory workers voted against the company’s latest wage agreement, prolonging the strike that has been ongoing for nearly six weeks. The strike has resulted in the halt of production for Boeing 737 MAX, 777, and 767 aircraft, exacerbating the financial difficulties for the aviation giant.
Union leaders stated that in Wednesday’s vote by the International Association of Machinists and Aerospace Workers (IAM), 64% of workers cast their ballots against the agreement. Boeing factory workers believe that their wages have lagged behind inflation rates for the past decade, and that the aircraft manufacturer has spent billions of dollars on stock buybacks and paid record high executive bonuses.
Jon Holden, the president of IAM District 751, said in a statement, “After 10 years of sacrifices, we deserve to be compensated, and we hope to achieve our goals through a swift resumption of negotiations.”
“This is democracy in the workplace and it proves that the company will face consequences for mistreating workers year after year,” Holden added.
A spokesperson for Boeing stated that they have no comment on the voting results.
The rejected compensation package included a 35% wage increase over four years, a one-time $7,000 signing bonus, improved retirement benefits, and more. Last month, a proposal with a 25% wage increase over four years was rejected by 95% of workers.
The union insists on a 40% wage increase and the reinstatement of the traditional pension plan frozen ten years ago.
Boeing has faced multiple challenges this year, including an incident in January where a door panel detached and flew off a 737 MAX aircraft operated by Alaska Airlines during a flight, putting Boeing under scrutiny by federal investigations.
The strike action has prevented Boeing from obtaining much-needed cash through aircraft deliveries. This Wednesday, the company reported a loss of over $6 billion in the third quarter.
Boeing workers told the Associated Press that the pension system is the sticking point where labor and management cannot reach a consensus.
“Pensions should be the top priority. We have all said that this is our main goal, along with wages,” said Larry Best, a customer service quality control coordinator who has worked at Boeing for 38 years. “Now is the perfect time for us to reclaim our pensions, and we all need to stand up and give it our all.”
Since September 13th, over 30,000 machinists have been participating in the strike. This poses a significant challenge for Boeing’s newly appointed CEO, Kelly Ortberg, who took office in August.
Ortberg stated in his first address to investors on Wednesday that Boeing needs a “fundamental cultural change” and proposed his plan to revive the airline company after years of significant losses and damaged reputation.
He emphasized that company leaders need to spend more time on the factory floor, understand what is happening, and “prevent problems from worsening, collaborate better to identify, fix, and understand root causes.”
Ortberg said, “Trust in our company has declined. We have taken on too much debt. There have been significant mistakes across our company that have left many of our customers disappointed.”
But he also highlighted the company’s strengths, including a backlog of aircraft orders worth $50 billion.
He said, “Reinstating Boeing’s former glory will take time, but with the right focus and culture, we can once again become an iconic company and a leader in the aviation industry.”
In recent weeks, Ortberg announced plans to lay off 17,000 employees globally and intends to raise enough cash to avoid bankruptcy.
Boeing has been experiencing annual losses since 2018. Chief Financial Officer Brian West stated that Boeing is not expected to generate positive cash flow until the second half of 2025.