Update, 11:30pm PST: KIRO TV (CBS Seattle) quotes Boeing spokesman Doug Alder as saying the Boeing offer has not been withdrawn, contradicting the IAM 751’s understanding.
Update, 9:10 PM PST: The Seattle Times reports the IAM 751 membership will get to vote on Boeing’s counter-contract offer after all.
Talks between Boeing and the IAM 751 machinists union failed to reach an agreement when Boeing presented a counter-proposal to the union’s offer that did’t budge on the pension issue, according to The Seattle Times.
KING5 TV (NBC Seattle) has this story.
Boeing’s statement is here.
IAM 751’s statement is below the jump (there isn’t a unique link to it).
The Boeing and IAM 751 statements paint a very different picture of the offers.
Although both sides now have said talks have ended, we fully expect political pressure on both sides to resume talks before Boeing makes a final decision on the 777X assembly site.
Boeing said it will make a decision early next year; our sources suggest this timeline is the end of January.
This leave a small window for a third try, but we’re not optimistic.
We believe that barring an agreement, Boeing Chicago will elect to put the 777X assembly site and wing production somewhere other than Washington.
We believe that those within the IAM membership who believe Boeing is bluffing are mistaken. One need look no further than the events leading to putting 787 Line 2 in Charleston. Members believed Boeing was bluffing then, and it wasn’t.
As we have written many times, while Boeing Commercial Airplanes is understood to want to assembly the 777X in Everett, headquarters in Chicago has a very different view–and in the end, it’s only that view that counts.
One item in the Boeing statement stands out like Braille to us as well:
In addition, a separate agreement committing final assembly of the 737 MAX at the Renton, Wash. site would have been extended through 2024.
For those who think it impossible Boeing wouldn’t start another 737 assembly line elsewhere, we understand from two sources close to Boeing that a study is underway about opening a 737 assembly line in Charleston. Some 737 MAX work has already been assigned there, and Boeing continues to buy land there.
We firmly believe that the industrial logic–and all other logic–demands that the 777X (and the 737 MAX) assembly be in Puget Sound. But Boeing CEO Jim McNerney is clearly intent on moving work away from the unions (and from Washington State) absent dramatic changes in contracts and the cost of doing business.
Boeing offered terms and conditions in the IAM contract that were sure to be rejected.
The PR war of who is responsible will continue for some time to come. But just as we firmly believe the 777X should be built in Washington, we also firmly believe it won’t be without some last minute agreement.
Washington politicians need to step up their effort to look Beyond Boeing for the future of the state’s aerospace industry.
Wroblewski: ‘We were willing to give Boeing labor peace’
SEATTLE – Talks between the Boeing Co. and Machinists Union District 751 have ended after the two sides failed to reach an agreement on a proposed contract extension that would have guaranteed the 777X would be built in Washington state.
“Our members want to build the 777X, and we believe Boeing’s best chance for success for this vital airplane program is for our members to build it here,” said District 751 President Tom Wroblewski.
“However, the price Boeing demanded was too high,” he continued. “Our senior leadership team could not recommend Boeing’s counter-offer.”
“On Wednesday, the union had offered Boeing a preliminary contract proposal that would have guaranteed the company a total of 16 years of labor peace by extending the current contract, which has been in place since 2008, until 2024.
“Boeing’s leadership has said time and again during this process that this was a top priority, and we were wiling to give them that,” Wroblewski said. “We were willing to give them labor peace.”
However, Boeing’s counter-offer on Thursday was mostly unchanged from the proposal that Machinists had rejected by a 2-to-1 margin on Nov. 13, demanding steep concession in retirement and health benefits while limiting future pay increases.
Boeing’s offer Thursday was contingent on union leadership recommending acceptance, Wroblewski said.
“This we could not do,” he said. “Our members had already rejected this.”
Wroblewski said the union will continue to make the case that Washington is the best place for Boeing to build the 777X, which is the latest derivative of Boeing’s best-selling widebody jet.
“Machinists Union pay and benefits make up less than 5 percent of the total cost of building an airplane,” he said. “And for these pennies on the dollar, Boeing gets in return the most-skilled, most-productive aerospace workers in the world
“Any objective analysis will show that Boeing’s best business case is to build the 777X in Washington, utilizing the skills, experience and dedication of our Machinists Union members,” he concluded.
Wroblewski said he does not regret attempting to negotiate a new deal. “Going back to the table was the responsible thing to do,” he said. “We just couldn’t get to an agreement. Again, the price was too high.”