Boeing is facing such a shortage of supplies that planes awaiting completion have to be parked in employee parking lots at a factory in Everett, Washington (USA) – Photo: ZUMA PRESS
According to Reuters, on September 13, workers at Boeing factories along the west coast of the United States went on strike, causing the production of the company’s 737 MAX aircraft to seriously stagnate.
This is the first strike the aircraft manufacturer has faced since 2008. The strike stemmed from the negotiations between Boeing’s leadership and union representatives over salary increases that did not go as expected.
Workers are demanding a 40% pay raise. But Kelly Ortberg, who took over as CEO of Boeing a few weeks ago, is proposing a 25% pay raise.
Faced with that situation, about 30,000 union members of the International Association of Machinists and Aerospace Workers (IAM) – the largest union within Boeing – voted on whether to agree with Mr. Ortberg’s proposal or not and whether to strike.
As a result, 94.6% of union members rejected the proposed wage increase and 96% agreed to strike.
“This is a fight for our future,” Jon Holden, who led negotiations for the IAM, said on September 12, just before the vote results were announced.
He also stressed that IAM will return to the negotiating table as soon as possible, but did not specify how long the strike might last.
On the other hand, Boeing also confirmed its readiness to return to the negotiating table. This is considered a sign that the company is ready to negotiate suitable terms for both sides.
“The message is clear that the preliminary agreement we reached with IAM leadership was not accepted by union members. We remain committed to working toward a rapprochement between employees and the union,” a Boeing representative said.
The Biden administration was quickly informed of the strike. White House press secretary Karine Jean Pierre said on September 12 that she had contacted both sides.
“We will encourage both sides to negotiate in good faith and reach a solid agreement,” she affirmed.
World aviation is difficult on top of difficult
Boeing employees at the 737 Max factory in Renton, Washington, March 2019 – Photo: REUTERS
The strike at Boeing broke out just as the corporation was struggling with penalties for reduced production capacity following a series of technical problems on its aircraft since the beginning of the year.
More broadly, the entire global aviation industry is also facing many difficulties due to the shortage of new aircraft. Boeing has had to reduce productivity, while Airbus has not yet escaped the difficulties in the supply chain.
The last time Boeing workers went on strike was in 2008. The strike disrupted Boeing’s production plans for two months and cost an average of $100 million a day in lost revenue.
According to TD Cowen, the 50-day strike cost Boeing $3-3.5 billion.