The Boeing Company (BA.US) proposed a 30% pay raise to appease the strike, but was met with a strong rejection from the union.

Boeing Company (BA.US) is bypassing angry union leaders and directly offering a 30% pay raise to striking workers in an attempt to quell a strike that has severely impacted its operations. The strike has resulted in Boeing Company shutting down aircraft manufacturing facilities in the Pacific Northwest region. The aircraft manufacturer has proposed a 30% pay raise for workers at its Seattle factory over four years, higher than the 25% raise that was rejected earlier this month by 33,000 members of the International Association of Machinists and Aerospace Workers (IAM). Boeing Company stated that these terms are a final offer valid until September 27. IAM District 751 responded strongly on its website a few hours later, stating that the proposal was "thrown at us without any discussion." The union mentioned that Boeing Company has refused to meet with them since negotiations broke down last week, adding that they will not schedule a vote on the latest proposal. IAM stated in their release, "This strategy is a blatant disrespect for you - our members - and the bargaining process." They referred to Boeing Company's "direct dealing strategy" as a "huge mistake." Negotiations have been at a standstill since September 18, with little progress made even after the U.S. federal government conducted two days of mediation. Earlier this month, workers voted overwhelmingly in favor of the strike, while local authorities planned to push for significant pay raises and require Boeing Company to reinstate the fixed benefit pension plan for employees. The dispute between Boeing Company and the union has drawn close attention from Wall Street and the White House ahead of the U.S. presidential election. Prolonging the strike will further strain Boeing Company's already tight financial situation. The company has already spent over $8 billion in cash in the first half of the year to address quality issues exposed by the January aircraft incident. Boeing Company's stock price has dropped by 40% this year, making it the second worst performer among the Dow Jones Industrial Average component stocks. Jefferies Financial Group Inc. analyst Sheila Kahyaoglu stated that the conflict has led to the halt in production of Boeing Company's "cash cow" 737 Max and other jetliners, potentially causing the company to lose an additional $1.3 billion in cash every month. With the risk of losing its investment-grade credit rating, the aircraft manufacturer has started placing employees on leave and taking other measures to preserve cash during the strike. Additionally, machinists at Textron Inc. Aviation went on strike on Monday after rejecting a contract offer with a 26% pay raise over the weekend. A potential strike by dockworkers may further cripple U.S. shipping.