Boeing strike continues as workers reject 35% pay raise proposal

Boeing’s striking workers have voted to reject a revised offer from the aerospace giant, prolonging the walkout that began on September 13.

The proposal, which included a 35% pay rise over four years, was turned down by 64% of members from the International Association of Machinists Aerospace Workers (IAM) union.

Second offer fails to win over striking workers

The latest rejection marks the second time Boeing workers have declined a proposed agreement.

Last month, 95% of union members voted against the company’s initial offer, reinforcing frustrations within the workforce.

More than 30,000 Boeing employees are participating in the strike, which has caused significant production delays across the company’s operations.

In a statement, union representatives emphasized the workers’ dissatisfaction.

“After 10 years of sacrifices, we still have ground to make up, and we're hopeful to do so by resuming negotiations promptly,” the IAM said.

Boeing faces $6 billion losses amid production slowdown

Boeing CEO Kelly Ortberg, who assumed leadership in August, warned the company is at a critical juncture.

Boeing has reported escalating losses, with a total of $6 billion lost across divisions.

Its commercial aircraft business suffered operating losses of $4 billion in the last quarter, while the defense division posted a $2.4 billion loss.

Ortberg acknowledged the company’s struggles during a recent statement, saying,

Operational setbacks and space program challenges

The strike adds to Boeing’s growing challenges, which began earlier this year when a mid-air blowout on a passenger plane highlighted manufacturing issues.

Its space operations also experienced setbacks, as the Starliner spacecraft had to return to Earth prematurely without carrying astronauts, raising concerns about quality and safety.

Ortberg admitted that Boeing's reputation has been damaged and emphasized the need for internal changes.

“We need to prevent the festering of issues and work better together to identify, fix, and understand root causes,” he said.

Workforce reductions and supply chain disruptions

Compounding the difficulties, Boeing announced plans earlier this month to cut approximately 10% of its workforce.

Many other employees are on rolling furloughs as the strike disrupts production.

The company is also working closely with suppliers to manage the impact of the walkout.

Ortberg told investors that once the strike concludes, restarting operations will be challenging.

“It’s much harder to turn this on than it is to turn it off. So it’s critical, absolutely critical, that we do this right,” he said.

The company has a detailed return-to-work plan ready to implement but stressed the importance of careful execution.

Backlog of orders offers Boeing a glimmer of hope

Despite the financial challenges, Boeing holds a significant backlog of approximately 5,400 aircraft orders, which Ortberg believes positions the company well for recovery.

However, analysts warn that the path to stability will not be easy.

“They clearly have a lot to recover from, both operationally and financially,” said Ben Toscanos of S&P Ratings. “

The first step will be to resolve the strike... so we’ll see how that plays out.”

Ortberg has outlined a strategy focused on changing Boeing’s internal culture, emphasizing collaboration and accountability.

“The priority now is to restore trust within our workforce and with our customers,” he said.