Boeing’s US West Coast factory workers accepted a new contract offer, ending a seven-week strike, according to Reuters.
The union said 59% of members voted in favour of the new contract. The deal includes a 38% pay increase over four years, easing pressure on new Boeing CEO Kelly Ortberg.
While the past few months have been difficult for all of us, we are all part of the same team. There is much work ahead to return to the excellence that made Boeing an iconic company.
The end of the first strike by Boeing’s largest union in 16 years brings welcome relief for the company since a door panel on a nearly new 737 MAX aircraft ripped off in mid-air in January. Some 33,000 machinists working on the best-selling 737 MAX aircraft, as well as the 767 and 777 widebodies, have been on strike since 13 September. They are demanding a 40% pay raise and restoration of the defined-benefit pension they lost a decade ago when they switched to a 401(k) retirement plan.
The old pension would not be restored, but workers would get an increase in the amount of matching company contributions to their 401(k) plans. Boeing also promised to build its next aircraft in the Seattle area.
President Joe Biden and Acting Secretary of Labour Julie Su congratulated the workers and the company on the result. Boeing said Su played an important role in reaching the ratified agreement.
Back to work
The International Association of Machinists and Aerospace Workers (IAM) stated that workers could begin returning to building planes from Wednesday, although Boeing warned that some people would have to be retrained due to the long absence from the plant.
According to various estimates, the strike cost Boeing about $100 million a day in lost revenue, prompting the aircraft maker to raise $24 billion from investors last week in an effort to preserve its investment-grade credit rating.
Ortberg now needs to mend relations with machinists in the Pacific Northwest, who used the strike to vent anger accumulated over a decade. The union said its members had received just four 1% pay rises in the past eight years, lagging behind inflation disastrously.
Boeing said the average annual salary for machinists at the end of the new four-year contract would be $119,309, up from $75,608 previously. The wage increase could add $1.1 billion to Boeing’s payroll over four years, according to Jefferies analysts.
More than 26,000 union members voted, with turnout around 80%.
