Boeing and its largest union, the International Association of Machinists and Aerospace Workers (IAM), have reached an agreement after a 53-day strike. This agreement includes a 38% pay rise over four years, a one-off $12,000 bonus, and enhancements to retirement options. The union members voted in favor of the deal, marking the end of a damaging walkout that impacted production of Boeing’s popular planes.
While the resolution of the strike is good news for Boeing and its airline customers, the planemaker’s problems will not disappear overnight. Boeing’s chief executive, Kelly Ortberg, stressed that the work to rebuild the company’s reputation and profitability has just begun. It may take time for Boeing’s factories and supply chains to regain momentum after the extended stoppage, with Ryanair CEO Michael O’Leary describing Boeing delivery delays as a “pain in the backside.”
Senior representatives from the Department of Labor played a role in mediating the dispute between Boeing and the IAM. Acting Secretary of Labor Julie Su described the agreement as historic and emphasized the importance of collective bargaining. The IAM represents around 33,000 workers in Washington State, a critical production center for Boeing’s best-selling models. The strike, which was the first major labor dispute between Boeing and the IAM since 2008, cost Boeing roughly $1 billion a month.
As part of efforts to shore up its finances, Boeing CEO Kelly Ortberg announced that the company will lay off 10% of its workforce. Additionally, deliveries of the flagship 777X commercial airliner will be pushed back to 2026. The resolution of the strike will allow Boeing and its machinists to build and strengthen their partnership, which will be crucial to Boeing’s success moving forward.
The Skift Travel 200 (ST200) index includes companies publicly traded across global markets in the airline sector. It combines the financial performance of nearly 200 travel companies worth more than a trillion dollars into a single number. The performance of airline sector stocks within the index provides insight into the overall financial health of the industry. The resolution of the strike between Boeing and the IAM is expected to have a positive impact on the airline sector moving forward.
