The Blubber

Aerospace Boeing, $BA, workers are demanding 40% pay raise, per Bloomberg.


Bloomberg reported on Tuesday that union leaders are pressing the troubled aircraft manufacturer to raise wages by 40% over the next three to four years — and are considering strike action to advance the proposal.

"Our objective is to reach a contract agreement that both our union leadership and members can endorse," stated Jon Holden, president of a Seattle-based branch of the International Association of Machinists and Aerospace Workers (IAM), in comments to the publication. "We don't take the decision to strike lightly, but we are prepared to take that step."

This development unfolds as Boeing grapples with fallout from an incident involving an Alaska Airlines 737 Max aircraft last month.

During a flight on January 5, a door plug covering a deactivated emergency exit became dislodged, necessitating an emergency landing. Boeing reacted by suspending its annual financial forecast and committing to enhance its quality-control procedures.

"Our primary focus is on implementing comprehensive measures to bolster quality at Boeing, which includes soliciting feedback from our 737 employees who perform this work daily," stated CEO Dave Calhoun in a press release on January 31.

The episode has elicited uncommon public criticism of Boeing from airline executives like Scott Kirby of United, its largest customer.

"The grounding of the Max 9 is likely the tipping point for us," he remarked to CNBC. "We will develop an alternate plan that does not involve the Max 10."

Boeing's prior agreement with the IAM, established in 2014, restricted salary increases to an average of less than 1% and terminated pension plans for non-union employees. Negotiations for the new contract are scheduled to commence on March 8.

"The frustration that our members felt during the 2013 and 2014 negotiations is undoubtedly prevalent today," Holden informed Bloomberg. "I hear it whenever I'm in the factory, from employees across the spectrum."

In the preceding year, autoworkers in Detroit and actors and writers in Hollywood went on strike to seek improved wages and working conditions.

Boeing did not immediately respond to a request for comment.