Salary increase proposal met with strong resistance. Boeing Company (BA.US) CEO warns that a strike will jeopardize the recovery.
Boeing (BA.US) CEO Kelly Ortberg urged members of the company's largest union not to go on strike, warning that a strike would damage the efforts of the aircraft manufacturer to turn around its factory operations after years of turmoil.
Boeing Company's CEO Kelly Ortberg is urging members of the company's largest union not to go on strike, warning that a strike would damage the efforts of the aircraft manufacturer to turn around its factory operations after years of turmoil.
In a letter to all Boeing Company employees in Washington and Oregon, Ortberg said, "I hope you will choose a bright future, but I also know that some employees are considering another path - one that has no winners."
The 33,000 members of the International Association of Machinists and Aerospace Workers (IAM) are set to vote on Boeing Company's proposed pay raise on Thursday, and decide whether to strike when the current contract expires at midnight. A strike could lead to the closure of Boeing Company's factories in the Pacific Northwest region, including the final assembly line for the 737 Max.
Emotions are running high among Boeing Company employees in the region, with protests and the sounding of whistles and horns to express anger over Boeing Company's proposal to guarantee a 25% wage increase over four years while simultaneously canceling annual bonuses. IAM has reportedly been pushing for raises of over 40%.
Labor disputes are becoming a key challenge for Ortberg, who took on the role of CEO in August. In January, a door panel fell off a Boeing Company plane, exposing quality defects in its products.
Ortberg emphasized to union leaders and senior management that he intends to change the culture of Boeing Company, starting with rebuilding relationships with employees.
In a memo, Ortberg said he understands the "strong" reaction of IAM members, acknowledging that Boeing Company's current difficulties are "partly due to our past mistakes."
Ortberg said, "Through collective effort, I know we can get back on track." However, he added, "A strike will jeopardize our shared recovery, further erode trust with our customers, and damage our ability to collectively determine the future."
Boeing Company's stock price has fallen by over 38% so far this year.
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