When workers at Boeing went on strike in September, it was just one of many serious problems the company faced in 2024. Starting in January, a door plug tore off of one of its planes at 16,000 feet, leaving a massive hole and causing an emergency landing. As a result, Boeing pled guilty to criminal fraud charges and must allow federal monitors to oversee future plane construction. At the same time, airlines around the world are impatiently waiting for Boeing to fulfill orders for new planes — especially the 777X widebody jet that the company has been promising since 2013.
So when the International Association of Machinists called a strike, it made the deepening crisis at Boeing even worse. After a nearly two month-long labor action, this week workers voted to accept a new deal with the company and return to their jobs. A new pay raise agreement will give workers an immediate 13 percent increase that grows over time. And instead of bringing back the former pension plan workers wanted, Boeing will give them a ratification bonus of $12,000, which can be invested into their retirement accounts. The collective work stoppage will go down in history as the costliest strike in more than 25 years, costing Boeing $6.5 billion. The overall cost to the U.S. economy is estimated at more than $11 billion.
But even with workers back in factories, it will take more than a year for Boeing to ramp up airplane production to normal levels and start making a profit. “This isn’t something that there’s just a light switch that flips,” said Boeing CEO Kelly Ortberg. “We’re probably going to have a little bumpy return.” Of course, the company is not in any danger of going out of business in spite of the problems it faces. Only Boeing and its rival Airbus produce the full-size commercial jets that are needed by the world’s airline industry. In fact, during the strike when no planes were coming off the production lines, Boeing still received new orders for 63 jets.
Questions:
- What concessions did the International Association of Machinists win from Boeing?
- Why did airlines place orders for new planes from Boeing even as the strike had production shut down?
Sources: Chris Isidore, “Boeing Workers Vote To Accept Deal, End Strike,” CNN, Nov. 5, 2024. Chris Isidore, “Boeing Got The Easy Part Done. Now Comes the Tougher, Existential Problems,” CNN, Nov. 12, 2024.