Boeing Co. is bracing for the first strike in nearly three decades at its St. Louis-area defense factories after union members rejected the company's modified contract offer.
About 3,200 machinists are set to walk off the job around midnight after members voted down a deal that would've raised wages by 20% and boosted retirement contributions. The union last went on strike in 1996, with the stoppage lasting 99 days.
"IAM District 837 members have spoken loud and clear, they deserve a contract that reflects their skill, dedication, and the critical role they play in our nation's defense," Tom Boelling, the union local's top official, said in a statement.
An American flag behind F/A-18 Super Hornet fighter aircraft at the Boeing Defense, Space & Security plant in St. Louis, Missouri.
The labor turmoil will increase financial stress on Boeing's defense and space segment, which earns roughly 30% of the company's revenue through the second quarter.
"We are prepared for a strike and have fully implemented our contingency plan to ensure our non-striking workforce can continue supporting our customers," Dan Gillian, a Boeing vice president and senior St. Louis site executive, said in a statement.
Union workers construct combat planes like the F-15, the T-7 trainer jet, missiles and bombs. They also produce parts for Boeing's 777X commercial aircraft.
A recent wave of activism has been sweeping through aerospace manufacturers, with unions gaining negotiating clout in the face of shortages of highly skilled mechanics.
Machinists staged a three-week walkout at Pratt & Whitney this year, which helped drive engine shortages in planemaker Airbus SE. Boeing's commercial plants were closed by striking workers for two months in late 2024.
Boeing Chief Executive Officer Kelly Ortberg played down the risk of a strike's consequences on July 29's earnings call.
"The order of magnitude of this is much, much less than what we saw last fall," Ortberg said, noting that the St. Louis union is about 1/10 the size of the Seattle-based union that struck last fall. "I wouldn't worry too much about the implications of the strike. We'll manage our way through that."
Boeing had designed its newest proposal to meet with the issues raised by members of International Association of Machinists and Aerospace Workers Local 837 when they rejected its original last week, Gillian informed newsmen on July 31.
Both proposals were the most lucrative contracts Boeing has ever offered district members: median salaries would rise to $102,600 from $75,000 for IAM 837 members. Boeing also removed a contentious schedule proposal and reworked its 401(k) terms so that employees receive the full contribution increase immediately rather than over three years.
Boeing warned it would cancel a $5,000 signing bonus and would not reinstate it for employees if the pact is not ratified by 11:59 pm Sunday.
