Boeing tries to avert the maxi strike next Friday, with a last-minute deal proposal that includes a wage increase and job security. It would be the first deal in 16 years for the American aircraft manufacturer and aims to avoid a strike by 32,000 employeesannounced by theInternational Association of Machinists and Aerospace Workers (IAM) for the September 13th. It would be quite a coup for Boeing’s new CEO, Kelly Ortberg, who took over last month with a goal of improving the quality of the planes the American company produces.
The proposed conditions
Boeing has put a four-year contractwhich includes a 25% wage increase and one employment guaranteewhich includes a commitment to build the next aircraft model at the current facilities in Seattle and Portlandin Oregon.
The proposed agreement also includes improved pension conditions and a higher contribution to the safety and to the quality of the production system.
The dispute was opened by IAM union who was asking wage increases of at least 40% over the next 3-4 years, the restoration of pension plans that Boeing eliminated in 2014, lower health care costs, safety improvements, reduction of mandatory overtime and job security.
The search for quality
For some years now, Boeing has been struggling with a quality crisis for its aircraft. Apart from the very unfortunate 737 MAX 8 model, which caused very serious accidents, such as the one in Ethiopian Airlines and, even before the accident in Indonesia, it is worth mentioning the more recent tailgate accident Alaska Airlines happened to a Boeing 737 MAX 9 earlier this year.
For this reason, the new Group CEO is focusing everything on quality of the new aircraft, which will arrive in the 30s, to replace the current models being marketed.
What to expect now
The attempted agreement, which the union described as the best in recent years in terms of quality, will have to be approved on Thursday next from majority of workers Boeing in the two American plants, otherwise a strike will begin.
If ratified by union members, the deal would commit Boeing to building the next aircraft in North America, after previously talking about moving production elsewhere to save costs.
Red accounts and competition
Boeing’s loss of appeal is also being reflected in its accounts: the American manufacturer announced in July that it had closed the second quarter with a net loss of 1.44 billion of dollars, equal to a loss per share of $2.33. Revenue fell to $16.9 billion from $19.8 billion a year ago due to continued delays in deliveries.
The main competitor Airbus has a full order book for the entire decade and cannot compensate for Boeing’s delays, which are representing a bottleneck for the airline industry. Recently, Bank of America and Wells Fargo cut their delivery forecasts, believing that the American manufacturer will fail to meet its target for the end of the year.
