Beijing, October 24 (Xinhua) -- Workers on strike at Boeing Company in the United States voted against a new salary agreement on the 23rd, continuing their nearly six week strike.
Boeing's financial report released earlier that day showed that due to factors such as strikes, the company lost nearly $6.2 billion in the third quarter of this year and has lost nearly $8 billion so far this year. Boeing executives predict that from now until the whole of next year, the company will continue to burn money and see little profit, requiring a fundamental corporate culture change to reverse its decline.
The strike will continue
On the 23rd, Boeing voted on a new salary agreement among striking workers in Washington, Oregon, and California on the West Coast of the United States. The results released late that night showed that 64% of workers opposed the new salary agreement, and therefore the strike will continue.
The new agreement includes a 35% salary increase within 4 years; Restore annual production performance bonuses of approximately thousands of dollars per transaction; Each worker who supports the new agreement can receive a one-time payment of $7000.
According to the Associated Press, the average annual salary for Boeing mechanics is $75600. The workers who participated in the vote expressed their opposition to the new agreement because key issues related to pensions have not been resolved.
The strike was caused by the breakdown of negotiations between labor and management to renew a new contract. Boeing employees voted against the salary plan proposed by management in September, and approximately 33000 employees subsequently went on strike.
According to Reuters, the existing expired contract was signed in 2014, and Boeing threatened to move the production of the new 777 aircraft out of the West Coast region of the United States in exchange for forcibly stopping a traditional pension policy in labor negotiations. The management has repeatedly proposed new salary plans in this round of labor management negotiations, but has not relaxed its stance on restoring pension policies.
The International Federation of Mechanical and Aerospace Workers, the union organization to which the striking employees belong, stated on the 23rd that it is ready to immediately resume labor negotiations after the voting results were announced.
The 'big ship' is difficult to turn around
The Boeing mechanics who participated in the strike mainly produced Boeing's flagship model, the 737 MAX, as well as the 777 passenger plane and 767 freighter. Reuters commented that the ongoing strike has dampened the hopes of investors and Boeing executives to resolve this intense dispute.
Boeing's financial report released earlier on the 23rd showed a loss of $6.17 billion in the third quarter, with revenue of $17.84 billion and cash reserves of $1.96 billion depleted. Currently, the company has liabilities of $58 billion.
Since the beginning of this year, Boeing has accumulated losses of nearly 8 billion US dollars. Boeing Chief Financial Officer Brian West said that the company may not be able to restore positive cash flow until the second half of next year. In fact, Boeing has suffered consecutive losses since 2018, with the third quarter loss being the second worst in the company's history.
The main reason for Boeing's significant losses is the significant asset write downs in both its commercial aircraft and defense products divisions, as well as the impact of the strike leading to the mass production stoppage of Boeing's mainstream aircraft models. Boeing's new CEO, Kelly Altberg, who was appointed in August, told investors on the 23rd that the company needs a "fundamental corporate culture change" to reverse its decline. He plans to "restart" the relationship between senior management and labor, "so that we will no longer be so disconnected in the future.
Ottoberg also emphasized that Boeing is a big ship that needs some time to make a U-turn, and once it completes the U-turn, it has the ability to become great again. The advantages he mentioned include Boeing's existing stock orders worth approximately $500 billion.
Since taking office, Ottoberg has announced multiple measures, including layoffs of 17000 people and a large-scale financing plan. Reuters reported that Boeing may sell equity or equity related securities in the near future to raise funds, with a potential size of up to $15 billion. Ultimately, Boeing may need to sell some of its assets.