Boeing factory workers vote to reject contract and continue 6-week strike

SEATTLE (AP) — Boeing factory workers voted Wednesday to reject the company's latest move Contract offer and to continue A six-week strike which halted production of the aerospace industry's best-selling jetliner.

Seattle local union leaders said 64% of International Association of Machinists and Aerospace Workers members who cast ballots voted against adopting the proposal.

“After a 10-year hiatus, we still have ground to build on, and we hope to do so by quickly resuming negotiations,” IAM District 751 union president John Holden said in a statement Wednesday evening. “This is democracy at work – and also clear evidence that there are consequences when a company mistreats its employees for years.”

A Boeing spokeswoman said officials had no comment on the vote.

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

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

Union machinists unite 737 maxBoeing's best-selling aircraft are the 777 or “Triple-Seven” jets and the 767 cargo plane at factories in Renton and Everett, Washington.

The offer rejected on Wednesday included a 35% pay rise over four years. The version that union members rejected when they voted to strike last month is a 25% increase over four years.

The union, which initially demanded a 40% pay rise over three years, said the revised offer would total annual increases of 39.8%, when compounded.

Boeing says the average annual salary for machinists is currently $75,608.

Boeing employees told Associated Press reporters that a sticking point was the company's refusal to do a recall. Traditional pension plan Which was frozen a decade ago.

“Pension should have been the top priority. We all said wages were our top priority,” Larry Best, a customer-quality coordinator at Boeing for 38 years, said on a picket line outside a Boeing factory in Everett, Washington. “Now is the prime opportunity to get our pensions back at a prime time, and we all need to be out and digging in our heels.”

Theresa Pound, a 16-year Boeing veteran, also voted against the deal. He said the health plan has gotten worse, with higher premiums and out-of-pocket costs, and that his expected pension benefits won't be enough even with a 401(k) retirement account.

“I put more time into this place than I needed to. “I literally put blood, sweat and tears into working for this company,” said the 37-year-old. No.”

The strike, which began on September 13, served as a preliminary test for Boeing CEO Kelly Ortberg, who Became Chief Executive in August.

In his first comments to investors, Ortberg said earlier Wednesday that Boeing needed “a fundamental culture change” and outlined plans to revive the aerospace giant after years of heavy losses. Damage to its reputation.

Ortberg reiterated in a message to employees and on the earnings call that he wants to “reset” labor-management relations “so we're not so disconnected in the future.” He said company leaders need to spend more time On the factory floor to know what's going on and “work better together to prevent problems and identify, resolve and understand root causes.”

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

“Confidence in our company has gone down. We are heavily indebted. We have had serious lapses in our performance across the company, which has disappointed many of our customers,” he said.

But Ortberg also highlighted the company's strengths, including a backlog of aircraft orders worth half a trillion dollars.

“It will take time to restore Boeing to its former legacy, but with the right focus and culture, we can once again be an iconic company and leader in the space,” he said.

In recent weeks, Ortberg announced Major layoffs – about 17,000 people – and a plan Raise enough cash Avoid a bankruptcy filing.

Boeing hasn't had a profitable year since 2018, and Wednesday's numbers represent the second-worst quarter in the maker's history. Boeing lost $6.17 billion in the period ended Sept. 30, with an adjusted loss of $10.44 per share. Analysts polled by Zacks Investment Research had expected a loss of $10.34 per share.

Revenue totaled $17.84 billion, matching Wall Street estimates.

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

Boeing Company shares fell 2% in regular trading on Wednesday.

Boeing's fortunes turned sour Its two 737 Max jetliners Crashes occurred in October 2018 and March 2019, killing 346 people. Safety concerns resurfaced this January when a panel blew out a Max during an Alaska Airlines flight.

Ortberg has to convince federal regulators that Boeing is doing it right Safety culture And is set to ramp up production of the 737 Max — an important step to bring in much-needed cash. But that cannot happen until the striking workers return to their jobs.

Early in the strike, Boeing created what it called “Best and Final” offer. The proposal included a 30% pay increase over four years, and angered union leaders because the company announced it to striking workers through the media and set a short approval period.

Boeing back down and Union gave Over time, however, many workers maintained that the offer was still not good enough. The company withdrew the proposed deal on October 9 after talks broke down, and the two sides announced the latest offer on Saturday.

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

“I feel sorry for the young people,” he said. “I've spent my life here and I'm getting ready to go, but they deserve a pension and I deserve a raise.”

The last Boeing strike in 2008 lasted eight weeks and cost the company about $100 million in delayed revenue per day. A 1995 strike lasted 10 weeks.