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Boeing workers vote on wage deal that could end strike

Updated: 05-11-2024, 03.46 AM

By Dan Catchpole and Allison Lampert

SEATTLE (Reuters) -Boeing U.S. West Coast factory workers were voting on an improved contract offer on Monday that could end a seven-week strike and restart most jet production at the troubled planemaker.

Boeing’s latest offer includes a 38% wage increase spread over four years, up from a 35% raise in a proposal that was rejected by around two-thirds of the 33,000 striking machinists in a vote 12 days ago.

Boeing’s fourth offer since a strike started on Sept. 13 comes at a critical moment for the company, which last week announced a $24-billion share issue to shore up its finances after the strike halted production of its cash-cow 737 MAX jet. The company’s shares rose 0.3% on Monday.

The International Association of Machinists and Aerospace Workers said on Sunday that workers can return to their shifts as early as Wednesday if the offer passes, or as late as Nov. 12.

Brandon Bryant, president of IAM District W24, which represents about 1,300 striking workers in Oregon, said the union had a long line of members waiting for polls to open.

“A lot of them that I’ve talked to today, they’re ready to get back to work,” Bryant said in an interview. “They think this is a good contract, they think it’s positive, they think it’s a great step forward. It doesn’t correct all the errors of the past but it’s a great foundation. We’re looking forward to building on that.”

It is not clear how long it will take Boeing to get back to pre-strike production levels, although the strike is widely expected to delay to 2025 a year-end rate target of 38 jets per month.

While Boeing is not regularly disclosing monthly MAX production figures, CFO Brian West has previously said monthly output went from high single digits at the end of the first quarter to roughly 25 in June and July.

The 38% wage increase could add about $1.1 billion over the four-year contract to the workers’ cost base of about $2.5 billion, according to a note from analyst Jefferies.

UNION ENDORSEMENT

The union’s District 751 President Jon Holden, who is negotiating on behalf of most of the workers, has endorsed the latest contract and warned workers that if they reject the deal Boeing’s next offer will be worse.

Voting ends at 7 p.m. U.S. Pacific Time (0300 GMT), with the result expected within hours.

Factory workers Reuters spoke to are divided on the latest contract, with some saying they are ready to return to work while others are willing to hold out for more benefits and the 40% wage increase they originally demanded.

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