The strike, which began after midnight, follows an overwhelming rejection of a tentative labor agreement by members of the International Association of Machinists and Aerospace Workers (IAM), with 94.6% voting against the deal and 96% supporting the work stoppage.
IAM Workers Reject Tentative Deal with Boeing, First Strike Since 2008
The IAM characterized the action as an “unfair labor practice strike,” citing allegations of discriminatory conduct, coercive questioning, and unlawful surveillance by Boeing management.
Workers rejected a tentative four-year contract unveiled on September 8, which offered a 25% wage increase over four years and improved retirement benefits. Union members argued that the proposal failed to adequately address rising living costs, having initially sought raises of about 40%. This marks the first strike by Boeing machinists since 2008, when workers were off the job for nearly two months. The current work stoppage halts production of most Boeing aircraft, including its bestselling 737 Max, and comes at a critical time for the aerospace giant.
Boeing has been striving to increase output and rebuild its reputation following a series of safety crises, including a door plug blowout on a 737 Max 9 in January 2024 that intensified federal scrutiny of its production lines.
Boeing Stock Tumbles in Premarket Trading
The strike’s financial implications for Boeing could be severe. Analysts estimate a potential 30-day cash impact of $1.5 billion, with concerns that prolonged disruption could destabilize suppliers and supply chains. The news sent Boeing’s stock tumbling in premarket trading, with shares down 3.21% to $157.55 as of 8:49 AM EDT on Friday.Boeing’s financial health was already precarious before the strike, with the company having burned through approximately $8 billion so far in 2024 and facing mounting debt. The labor dispute presents yet another challenge for new CEO Kelly Ortberg, who has been at the helm for just five weeks.The strike underscores Boeing’s ongoing struggles, reflected in its stock performance. Year-to-date, Boeing shares have declined 37.55%, significantly underperforming the S&P 500’s 17.32% gain. With a market capitalization of $100.303 billion and a trailing twelve-month EPS of -$5.65, the company faces an uphill battle to regain investor confidence.More By This Author:Stocks To Watch Today: UBER, ADBE, And MSTRModerna Slashes R&D Budget, Stock Plummets Amid Profitability ConcernsWBD And Charter Communications Forge Landmark Deal, Stocks Gain
