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Boeing, Machinists Reach New Tentative Deal

Credit: Sean Broderick/AWST

Striking International Association of Machinists (IAM) members head to the polls Nov. 4 to vote on a union-recommended tentative agreement with Boeing that, if ratified, would see workers starting to return to idled production facilities as soon as Nov. 6.

The new proposed deal, reached with assistance from U.S. Labor Secretary Julie Su and announced Oct. 31, would boost workers’ general wages 38% over four years: 13% in the first year, 9% each in the next two years and 7% in the agreement’s final year, summaries shared by Boeing and the union show. The agreement also includes a $12,000 ratification bonus, increased 401(k) plan contributions and a company commitment to build any new aircraft announced during the contract period in the Puget Sound region of Washington state.

It does not include restoration of pensions that union workers gave up in a 2014 vote, but those hired before Jan. 3, 2014, who still have pensions will see higher annual service increases.

“This contract builds on everything achieved in the Sept. 12, 2024, agreement, with the additional gains you achieved by going on strike,” IAM District 751 said in a statement. “Your union is endorsing and recommending the latest IAM/Boeing contract proposal. It is time for our members to lock in these gains and confidently declare victory. We believe asking members to stay on strike longer wouldn’t be right as we have achieved so much success.”

Word of the deal came on Day 49 of a strike that saw 33,000 IAM District 751 and W24 workers walk out following an overwhelming rejection of the Sept. 12 offer that included a 25% pay hike. An improved offer featuring a 35% pay increase was rejected by 64% of voting members on Oct. 23.

The union’s initial requests included a 40% pay raise and restoration of pensions. The new agreement falls short of the wage demand but includes a ratification bonus equal to 10% of the average machinist’s salary at the end of the proposed contract, figures shared by Boeing show.

“We encourage all of our employees to learn more about the improved offer and vote on Monday, Nov. 4,” Boeing said in a statement.

While a “yes” vote would see workers begin to return within two days, restarting operations on the dormant 737, 767 and 777 lines and in other affected Puget Sound-area facilities is expected to be a “bumpy” process, CEO Kelly Ortberg cautioned on the company’s most recent earnings call.

“It will probably be a couple of weeks” before the workers are back in full force, he added, emphasizing that a smooth restart is more important than a rapid one. “It’s critical—absolutely critical—that we do this right,” Ortberg said.

While Boeing recently bolstered its cash on hand by raising $21 billion in stock, word of a possible end to the strike comes at a key time for many suppliers. Spirit AeroSystems recently began a 21-day furlough for 700 employees on 767 and 777 programs. Others were told by Boeing to stop shipments as soon as the strike started.

“Although [Spirit] has not materially slowed supplier orders, we believe there is growing risk of a material supply-chain slowdown and decreased confidence as the strike continues,” RBC Capital Markets analyst Ken Herbert wrote in an Oct. 29 investor update. “We have heard from many suppliers that they are exploring additional cost-saving measures (staff reductions, lower production rates) while confidence in the latest [Boeing] master production schedule remains very low.”

Uncertainty around the strike and a larger challenge to demonstrate stability and consistency to the FAA in the aftermath of January’s Alaska Airlines 737-9 door-plug blowout—linked to production problems—has left Boeing unable to project timing of 737 rate increases. RBC’s “best-case scenario” sees Boeing reaching 38 per month—the current FAA-imposed limit—in the second half of 2025, Herbert wrote.

Sean Broderick

Senior Air Transport & Safety Editor Sean Broderick covers aviation safety, MRO, and the airline business from Aviation Week Network's Washington, D.C. office.