Seattle: Boeing's commercial plane manufacturing factories will come back to life with the return of around 27,000 workers who struck work almost eight weeks ago. The strike has had more than just a minimal impact on Boeing's financials and delivery schedules.
Members of the striking International Association of Machinists voted overwhelmingly to end the strike that had brought work at Boeing to a grinding halt, clipped profits, stalled deliveries, and also created a ripple effect across the industry felt by most of the company's suppliers across the world.
The workers who have been on strike since early September, are now expected to return to their workstations and assembly lines on Sunday night.
Boeing's factories have been closed since 6 September, when machinists walked out after failing to resolve a number differences with the company, including outsourcing of work and job security. The strike is estimated to have cost Boeing around $100 million per day in terms of deferred revenue and production delays and has also pushed back deliveries of the already-delayed Boeing 787 Dreamliner.
Union members inked a new deal with Boeing after voting to bring the strike to an end. Around 74 per cent of the 27,000 workers at plants in Washington State, Oregon and Kansas voted in favor of the new agreement, which was reached after five days of discussions in Washington.
A union statement said the new deal would give workers at Boeing an ''opportunity to share in the extraordinary success this company has achieved over the past several years." It also said the deal recognises the need to act with foresight to protect the next generation of aerospace jobs, and that ''these members helped make Boeing the company it is today, and they have every right to be a part of its future."
The union says that the new contract with Boeing protects more than 5,000 factory jobs, prevents the outsourcing of certain positions and preserves health care benefits. The contract will also allow pay increases to be spread over four years in place of three, which had been offered previously.
This was the union's fourth strike against Boeing overthe last 20 years, and is also the longest since 1995. The machinists' union has staged strikes against Boeing for 24 days in 2005, 69 days in 1995 and 48 days in 1989.
In its own statement, Boeing's president and chief executive for the company's commercial airplane division, Scott Carson said that the company was looking forward to having its team back together and ''resume the work of building airplanes for our customers." He said that the new contract addresses ''the union's job security issues while enabling Boeing to retain the flexibility needed to run the business'', saying that it would allow Boeing to remain competitive.
Job security and the use of suppliers were key issues in the strike that began on 6 September, 2008. Among the other issues resolved in the latest round of bargaining were wage rates, health care benefits for current and future employees, pension improvements and work rule changes designed to improve productivity. Also, for the first three years workers get the 11 per cent pay hike Boeing had offered, with a four per cent raise in the fourth year. The IAM had proposed 13 per cent for the first three years.
Shares of Boeing's suppliers, who had been impacted by the strike, too buoyed after news of the breakthrough in talks came out. Shares of Spirit AeroSystems Holdings Inc, a former unit of Boeing that manufactures fuselage and wing parts rose six per cent, while those of carbon-composite provider Hexcel Corp gained 19 per cent. The stock of titanium producer RTI International Metals Inc went up 29 per cent.
Recent signs from both the union and the company were that of bringing the strike to an end. Reports quoted unnamed Wall Street analysts as estimating that Boeing was bleeding $100 million in revenue for each day of plant closures, while simultaneously striking workers were losing their usual health-care benefits after one month on strike, are were getting a frugal sustenance of $150 per week as strike pay from the union.
Boeing's next challenge at hand is to avoid a similar scenario with the the Society of Professional Engineering Employees in Aerospace (SPEEA), which represents over 20,000 white-collar engineering workers. On its website, SPEEA said that negotiations would start with Boeing on Wednesday.