Boeing Strike Update: Tentative Deal Reached

After more than a month of halted production and mounting pressure, Boeing and the International Association of Machinists and Aerospace Workers Local 751 have finally reached a tentative agreement. This could mark the beginning of the end of the strike that has stalled operations for over 33,000 unionized workers on the West Coast since September 13. The strike has effectively shut down production of Boeing’s critical 737 MAX, as well as its 767 and 777 widebody aircraft, worsening the financial strain the company has been dealing with for some time.

The new deal, set for a vote by union members on Wednesday, offers significant concessions from Boeing. It includes a $7,000 ratification bonus, a reinstated incentive plan, and a one-time $5,000 contribution to workers’ 401(k) plans, with the potential for up to 12% in employer contributions moving forward. This proposal comes after Boeing pulled an earlier offer, which included a 30% wage increase over four years, following a breakdown in negotiations despite federal mediators stepping in.

However, there’s no guarantee the workers will approve this offer. The union has been very clear: the future of this contract is entirely in their hands. In fact it was a big HELL NO during the last talks… Workers overwhelmingly rejected a previous deal in September that offered a 25% pay raise over four years. Now, with the industry’s suppliers like Spirit AeroSystems already announcing furloughs, and outside pressure mounting from groups like the U.S. Chamber of Commerce, all eyes are on Wednesday’s vote to see if this deal will finally bring an end to the strike.

At the center of these tense negotiations is Boeing’s relatively new CEO, Kelly Ortberg, who took over earlier this year. Ortberg, known for his long history in aerospace, particularly with Rockwell Collins, has been working to bring some much-needed stability to Boeing after years of turbulence. His focus has been on improving operational efficiency and tightening financial discipline, key elements in Boeing’s plan to remain competitive. But Ortberg also knows that none of this will matter if the company’s relationship with its unionized workforce continues to fray.

Under his leadership, Boeing is trying to navigate several challenges at once: ramping up production of the 737 MAX, a crucial revenue driver, while addressing supply chain disruptions and dealing with the residual impact of the pandemic. The strike has thrown yet another obstacle in the path of these efforts, and now Ortberg is tasked with more than just solving production issues. He needs to show that Boeing values its workforce, especially after years of tough negotiations and rising tensions.

The latest proposal is Boeing’s attempt to do just that, but it stops short of meeting all the union’s demands—particularly around the reinstatement of defined-benefit pensions, which older workers have been pushing for. While some union leaders are optimistic that this deal will pass, others expect pushback from workers who feel these demands have not been fully addressed.

Regardless of the outcome, this is a pivotal week for Boeing. If the deal is approved, production could resume quickly, easing financial and operational pressure on the company. If it’s rejected, Boeing could be looking at prolonged disruption, and its already delicate financial situation could deteriorate further.

For now, everything hangs on Wednesday’s vote. The outcome will set the tone for the company’s next steps—both in terms of its production goals and how it manages its workforce moving forward. This is a defining moment for Kelly Ortberg, his leadership, and Boeing’s future.

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