Skift Take
Even if the union ratifies the new contract, Boeing still has to confront a slew of issues with its aircraft programs that have led to delays and production slowdowns.
Boeing’s machinist union announced Saturday that it reached a tentative agreement with the company, ending the month-long strike that halted production.
The plane maker is offering a 35% raise over four years in the latest proposal. The union plans to vote on the new agreement October 23. Boeing is also keeping annual bonuses, which it had eliminated in its initial offer. Under the new contract, employees will also receive $7,000 ratification bonuses.
However, the new offer doesn’t restore pensions, which was a key demand from many union members.
Boeing’s chapter of the International Association of Machinists and Aerospace Workers said on Saturday that the agreement was achieved with the help of acting Labor Secretary Julie Su, who met with both sides earlier this week.
“We have received a negotiated proposal and resolution to end the strike, and it warrants presenting to the members and is worthy of your consideration,” IAM District 751 said on Saturday.
Boeing Still Has to Confront Issues With Aircraft Programs
It was previously estimated that Boeing was losing as much as $1 billion a month because of the strike. The company announced Tuesday that it would sell up to $25 billion in stock or debt to shore up its liquidity. It also entered a $10 billion credit agreement with a consortium of banks.
Just weeks before, Boeing CEO Kelly Ortberg told employees that the company would need to delay the launch of the 777X and lay off 10% of its staff, translating into 17,000 employees.
Even if the union ratifies the new contract, Boeing still has to confront a slew of issues with its aircraft programs. Ortberg said the first deliveries of the 777X would be delayed due to issues with development. In August, Boeing found structural flaws in the 777X and had to pause flight testing, according to Reuters.
Boeing is set to report third-quarter earnings October 23.