Boeing workers who are on strike have turned down a new offer from the company, which included a 35% pay increase over four years. The International Association of Machinists and Aerospace Workers (IAM) union stated that 64% of its striking members voted against the proposed deal. Over 30,000 of Boeing’s employees have joined the strike, which began on September 13th after an initial offer was rejected. This decision comes shortly after Boeing CEO Kelly Ortberg warned that the company is facing a critical situation as losses have reached around $6 billion. Union representatives mentioned in a statement that despite 10 years of sacrifices, there is still progress to be made, and they are hopeful to do so by resuming negotiations promptly. Boeing has not yet publicly commented on the rejection of their latest offer. This is the second time the striking workers have refused a proposed deal through a formal vote, with the previous offer being rejected by 95% of workers last month. Kelly Ortberg, who assumed the role of CEO in August, expressed his efforts to stabilize the company and restore its reputation, which has been affected by manufacturing and safety issues. The ongoing crisis at Boeing began in January with a significant mid-air incident involving one of its passenger planes. The strike has worsened the situation, leading to a notable slowdown in production. Ortberg acknowledged that the company has accumulated substantial debt and has disappointed customers with performance shortcomings across the business. Boeing’s commercial aircraft business reported operating losses of $4 billion in the last quarter, while its defense unit suffered losses of nearly $2.4 billion. Analysts suggest that resolving the strike is the first step towards recovery and await its outcome. Ortberg highlighted the company’s strong position with a backlog of approximately 5,400 plane orders but cautioned investors about the challenges of restarting factories once the strike ends. He emphasized the importance of a well-executed return-to-work plan and expressed eagerness to have everyone back and operational. In response to the strike’s impact, Boeing announced plans to reduce its workforce by approximately 10%. Ortberg emphasized the need for a fundamental cultural shift within the company to address issues effectively and collaborate more efficiently to identify and resolve underlying problems.
