Boeing Strike to Continue as Union Members Reject New Offer

24.10.2024 - 03:13 / skift.com / Gordon Smith / Julie Su / Kelly Ortberg

A major strike at Boeing will continue after union members rejected a revised deal. The IAM union announced on Wednesday night that 64% of mechanists turned down the offer.

The development is a major blow for the plane maker. Last week IAM bosses reached a tentative deal with the company. It was this package that was rejected in a ballot of members.

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The setback comes on the same day that Boeing reported a third-quarter loss of $6 billion, its largest since the start of the pandemic in 2020. The commercial airplanes unit had a third-quarter loss of over $4 billion, a significant change from the $678 million loss reported last year.

The plane maker offered a 35% raise over four years in its latest proposal. Boeing maintained annual bonuses, which it had eliminated in its initial offer, with employees also due to receive $7,000 ratification bonuses. 

However, the new offer didn’t restore pensions, which was a key demand from many union members.

The failed offer was negotiated with the help of acting Labor Secretary Julie Su, who met with both sides to seek a solution to an increasingly heated dispute.

The IAM union represents around 33,000 Boeing staff in the Pacific Northwest. The sites currently on strike produce the 737 Max single-aisle plane as well as the larger 777 aircraft.

Staff downed tools at midnight on September 13, sparking the first major labor dispute between the parties since 2008. On that occasion, drawn out negotiations resulted in a 57-day strike that crippled output and cost Boeing around tens of millions of dollars a day.

The current strike is costing Boeing roughly $1 billion a month, according to estimates from S&P Global. Boeing CEO Kelly Ortberg recently told staff that the company will lay off 10% of its workforce and delay the first deliveries of the 777X to 2026.

On October 11, Boeing withdrew an earlier pay offer, alleging that the IAM failed to “seriously consider our proposals.” The union responded with claims that Boeing was “hell-bent on standing on the non-negotiated offer.”

Skift has contacted Boeing and the IAM for comment. 

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