Boeing has raised its pay offer to striking workers, proposing a 38% wage increase over the next four years in hopes of resolving a prolonged dispute that has slowed production.
The International Association of Machinists and Aerospace Workers (IAM), representing over 30,000 workers, announced it will vote on the new offer Monday.
Workers have already rejected two previous offers, with a key sticking point being wage increases; the latest offer improves on Boeing’s previous 35% raise proposal, the BBC reported.
Beyond wages, Boeing’s updated offer includes a $12,000 bonus, increased from an earlier $7,000, if the new terms are accepted.
The union expressed optimism, describing the offer as a chance for workers to “lock in these gains.”
Boeing, facing mounting costs from the strike, echoed the sentiment, encouraging workers to consider the new proposal seriously.
The strike, which began on September 13, has cost Boeing nearly $10 billion according to analysts, significantly impacting its finances.
Last quarter, the company’s commercial division alone reported a $4 billion loss, as the work stoppage affected key projects and production timelines.
Boeing’s stock rose 2.7% after announcing the new offer, reflecting investor hopes for a resolution.
This labor dispute comes at a difficult time for Boeing, which has been grappling with various financial and reputational setbacks. Besides production delays from the strike, the company has faced a potential downgrade to its credit rating, raising concerns about its borrowing costs.
To bolster its finances, Boeing recently launched a $20 billion share sale. Adding to Boeing’s challenges, the firm also plans to lay off approximately 17,000 employees, with the first round of notices expected in mid-November.
This difficult measure highlights the financial pressures Boeing faces amid high labor and production costs from the strike.
With a vote scheduled, both Boeing and the IAM are eager to find a resolution that will end the costly stalemate and stabilize production. As the strike nears the two-month mark, all eyes are on the union’s ballot next week, which could finally bring Boeing back to full operations.
Written with the assistance of artificial intelligence.