Boeing Workers Vote on Contract as Potential Strike Looms

Workers leave the factory where Boeing 737 Max planes are built in Renton, Wash., on Dec. 17, 2019. Ted S. Warren/AP Photo

Boeing’s West Coast factory workers stood in long lines on Sept. 12 to vote on a scrutinized new contract, with many calling for a strike that could start as early as the following day.

The possible strike would be another blow to Boeing in a year of repeat headaches that began with the Jan. 5 Alaskan Airlines incident, when an unused door panel ripped off a jet moments after takeoff.

The aerospace company has since endured multiple congressional hearings, recently pleaded guilty to conspiracy to defraud the U.S. government, and had to enlist the help of competitor SpaceX to bring its astronauts back to Earth after serious safety issues forced its Starliner capsule to return unmanned. Boeing also welcomed new CEO Kelly Ortberg last month to restore faith in its operations.

On Thursday, roughly 30,000 workers of the International Association of Machinists and Aerospace Workers union are voting on their first new contract in 16 years. These workers construct the company’s 737 Max, 767, and 777 airplanes in the Seattle and Portland areas. Voting will close at 9 p.m. ET, and the union will announce the result later in the evening.

They are voting on a deal that includes a $3,000 signing bonus, a 25 percent general wage increase, and a promise to build the company’s next commercial jet near Seattle if the program is launched within four years of the new contract.

The union recommended signing the deal on Sept. 8, but many workers are furious with the negotiations after originally seeking a 40 percent pay raise while retaining an annual bonus.

Lines for the vote wrapped around the streets outside the union’s Renton offices, the Seattle-area location where Boeing manufactures its popular 737 airplanes. Several of the workers in the streets were holding signs with the word “strike.”

The union’s rules require at least two-thirds of its members to vote to approve a strike. If fewer members vote to strike, the contract will automatically go into effect.

Boeing has seen workers protest throughout the week in its Seattle area factories. The company’s shares are down 36 percent this year after it faced increased scrutiny over failing quality assurance and safety practices that led to the fatal 2018 and 2019 737 Max crashes and the January door panel incident. Family members of the 737 Max crash victims are currently urging a federal judge to reject Boeing’s plea deal with the government.

Boeing also has a $60 million debt burden, which would only be exacerbated by a strike that would increase delays in plane deliveries. Investment banking company TD Cowen estimated that a potential strike could cost Boeing anywhere between $3 billion and $3.5 billion in cash flow without having union workers to finish constructing partially built planes. The last time Boeing’s workers went on strike, in 2008, it closed plants for 52 days and caused the plane maker to lose roughly $100 million each day.

New CEO Ortberg urged the workers to approve the deal in a letter on Sept. 11.

“A strike would put our shared recovery in jeopardy, further eroding trust with our customers and hurting our ability to determine our future together,” he wrote.

Reuters contributed to this report.