Boeing posted a third-quarter loss exceeding $6 billion while awaiting the outcome of a vote by striking factory workers on a new contract offer. AP News states that the strike which began in mid-September, has halted aircraft production, severely impacting the company’s operations.
Contract offer divides Boeing workers
Union workers from the International Association of Machinists and Aerospace Workers are voting on a proposal that includes a 35% pay raise over four years. While some workers support the offer, others, like Brian Hatcher, are critical of its failure to reinstate pensions that were scrapped a decade ago.
“I voted no,” Hatcher, a 15-year Boeing veteran, said. “We need our pensions back.”
New CEO Kelly Ortberg calls for change
Kelly Ortberg, Boeing’s new CEO, has faced early challenges with the strike. Addressing investors, he emphasized the need for a “fundamental culture change” at Boeing, saying that management must reconnect with factory workers to prevent future labor disputes. Ortberg also acknowledged the company’s mounting debt, performance issues, and the erosion of trust but remains hopeful about the company’s future.
Boeing’s financial struggles continue
Boeing reported a $6.17 billion loss for the quarter ending September 30, marking its second-worst quarter ever. Despite generating $17.84 billion in revenue, the company burned through nearly $2 billion in cash, further straining its $58 billion debt. Ortberg announced plans for large-scale layoffs and financial restructuring to stave off bankruptcy.
Challenges ahead: The need for federal approval and labor resolution
Boeing must secure federal regulatory approval to address safety concerns tied to its 737 Max jet, a crucial step in restarting production and recovering financially. However, this will be impossible until striking workers return. The current contract offer, which includes bonuses and retention of performance rewards, has been met with mixed reactions.
Union leaders plan to announce voting results soon, with the outcome determining whether Boeing can resume operations or face continued disruptions.
