Boeing workers have leverage to make real change
By Thomas Black / Bloomberg Opinion
It’s hard to overstate the damage that a machinists strike could do to Boeing Co. and, more important, to the planemaker’s fragile supply chain.
Suppliers had already been whiplashed by the groundings of the 737 Max and the 787 and then the pandemic. Boeing was just beginning to get back to building planes in an orderly fashion and keeping work steady for its supply base, which is key for their financial health and the production of high-quality parts. The overwhelming support to go on strike — 96 percent of the 33,000 members of the International Association of Machinists and Aerospace Workers in Seattle voted to take to the streets — is an ominous sign for Boeing. This walkout could drag on for weeks, and Boeing will have to pay a high cost it can ill afford to satisfy workers. The company is burning through its $12.6 billion of cash and has a huge $58 billion debt burden, raising concern it could lose its investment-grade ratings. In fact, Moody’s Ratings said on Friday that it had placed the company’s debt rating on review for a potential downgrade to junk.
Unfortunately, Boeing’s new chief executive officer, Kelly Ortberg, is reaping what was sown a decade ago when the company thought it was smart to put the screws to union workers with the threat of moving more production to its nonunion South Carolina facility. That 10-year contract extension reached in 2014 froze pension benefits, among other things, planting the seeds of this thorny conflict.
The union now has the upper hand because Boeing desperately needs to ramp up production of planes to help heal its supply chain and stem its losses. The company offered a general wage increase of 25 percent over four years and a $3,000 bonus for approving a new contract. Workers wanted a 40 percent raise and annual performance bonuses.
https://www.heraldnet.com/opinion/comment-boeing-workers-have-leverage-to-make-real-change/