Boeing machinists to strike as contract talks fail
Bill Rig And Laura MyersNEW YORK/EVERETT, Washington (Reuters) - BoeingCo's 27,000-strong machinists' union declared it willstrike at midnight Pacific time Friday, as the plane makerfailed to improve its contract offer after two days ofemergency talks.
"Despite meeting late into the night and throughout theday, continued contract talks with the Boeing Company did notaddress our issues," Tom Wroblewski, the IAM's Seattle-areapresident, said in a letter to members. "The strike is on."
The vast majority of the International Association ofMachinists and Aerospace Workers' (IAM) 27,000 members voted toreject Boeing's "best and final" offer Wednesday, butpostponed a strike for 48 hours to give negotiators more time.
Boeing and IAM teams, along with federal mediators, weremeeting at Walt Disney Co's Coronado Springs resortnear Orlando, Florida, where the IAM is set to have itsconvention, held every four years, starting Sunday.
"Over the past two days, Boeing, the union and the federalmediator worked hard in pursuing ... options that could lead toan agreement. Unfortunately the differences were too great toclose," said Scott Carson, CEO of Boeing Commercial Airplanes,in a statement.
Boeing's machinists were already preparing to strike beforetalks over the last three-year contract were called off.
Union volunteers rolled out 52-gallon oil drums -- known as"burn barrels" -- and readied coffee and soup to keep expectedpicketers warm at the company's Everett, Washington plant,despite the balmy 65 degree weather.
Boeing has proposed shifting more health care costs ontoworkers, one of the major sticking points in negotiations.
"We're not at it for the money, we're at it for themedical, which they (Boeing) are freaking crushing," saidJoseph Young, a 48-year-old insulation installer who has workedat Boeing for 21 years.
Workers outside the gates said colleagues inside werereporting only about 25 percent attendance by mechanics at theplant.
Boeing declined to comment on activity at its factories.
MIDNIGHT DEADLINE
The strike begins for most of the union members at midnightSeattle time, which is when the current three-year contractexpires. The bulk of Boeing's machinists work at plants aroundthe Puget Sound area.
A strike would bring Boeing's massive plants at Everett andRenton, Washington to a standstill, halting production of its737, 747, 767, 777 and 787 planes.
Boeing, which made a $4.1 billion profit last year and hasa record $275 billion worth of commercial plane orders in itsbooks, could financially survive a short strike, but it wouldfurther complicate its efforts to get the already-delayed 787Dreamliner into the air.
If the strike prevents plane deliveries, it would costBoeing about $100 million in revenue per day and knock about 1cent per day off earnings per share, according to Wall Streetanalysts.
A walk-out by the IAM would be the fourth at Boeing in 20years. The union struck for 48 days in 1989, 69 days in 1995and 28 days in 2005. In 2002, a contract was adopted bydefault, as it was rejected by workers but fewer thantwo-thirds approved a strike.
BEST AND FINAL
Boeing's "best and final" contract offer this time aroundwas delivered to union members a week ago, proposing an 11percent wage increase over the three-year life of the contract,a one-time lump sum and ratification bonus, and otherincentives that the company said would add about $34,000 to thepay of the average machinist, who now makes about $65,000 ayear including overtime.
That failed to meet union demands for a 13 percent wageincrease, no change to health care contributions and theroll-back of provisions allowing Boeing to outsource work.
"I'd use this contract for toilet paper, but there's toomany holes in it," said Randy Carroll, a 52-year old mechanicat Boeing's plant in Auburn, Washington, who traveled toEverett in support of a likely strike.
Boeing shares fell 14 cents to close at $62.89 on the NewYork Stock Exchange. (Reporting by Bill Rigby in New York and Laura Myers inEverett, Washington and Daisuke Wakabayashi in Seattle; editingby Carol Bishopric, Richard Chang)