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By the Leeham News Team

Analysis

Sept. 16, 2024, © Leeham News -- The lopsided outcome of last week’s vote by the International Association of Machinists District 751 union members to resoundingly reject Boeing’s four-year contract offer caught a lot of observers by surprise, including us.

Not that we didn’t expect the offer would be rejected. That seemed a reasonable bet. But if anyone tells you their Magic 8 ball had predicted a 94.6% vote to reject the contract and a 96% vote to strike, they’re overstating.

Our industry sources tell us that Boeing management was utterly gobsmacked by the result. Even the union staffers and officers we talked to on the night of the vote were surprised.

The result is now that some 33,000 751 members spent the weekend on picket lines surrounding Boeing facilities in Washington state, Oregon, and Edwards Air Force Base in California.

And Boeing management, which had very little leverage going into these contract talks, has approximately zero leverage now.

The problem, for everyone in our industry hoping for a quick resolution of this strike, is that Boeing has been acting since intensive talks started in August like it doesn’t understand how little leverage it has over the union this year. Despite new CEO Kelly Ortberg’s factory floor visits and talk about a “reset” with the unions at Boeing, Boeing acted like it believes it’s still 2014 when it won a bitter fight for a contract amendment granting concessions in exchange for locating the 777X final assembly line in Everett (WA).

Maybe Thursday night’s results will be the moment Boeing’s labor relations strategy needs if it’s ever going to solve its interconnected safety, quality, reputational, and cash-flow problems.

Summary

• What’s the latest
• Why the offer failed
• At the table
• Where we are
• How does this end?