No agreement reached

The mediated talks with the IAM have ended without reaching agreement. Boeing has issued this statement:

“Over the past two days, Boeing, the union and the federal mediator worked hard in pursuing good-faith explorations of options that could lead to an agreement. Unfortunately the differences were too great to close,” said Scott Carson, president and CEO of Boeing Commercial Airplanes.

During the work stoppage, we’ll continue to support our customers, and their airplanes in service. We’ll also deliver airplanes that were completed before the strike, but we don’t intend to assemble airplanes during the strike.

You can follow any updates from Boeing here.

Comments (8)

Hunter Chumbley (Renton, WA):

I am very disappointed that Boeing and the IAM couldn't reach a contract agreement. If Boeing Leadership continues to view and treat IAM members as nothing more than 3rd class citizens, then I don't there will ever be an agreeable end to the continuing conflict between the 2 parties

G (France):

The strike is a very sad story in a dull period of commercial aviation. But you can still see the bright side of it.

The reality is that very few airlines can take delivery of new airplanes. Their financing capability is depleted to almost nil due to the fact that they are not making money and because of the current credit crunch.

It is quite difficult to get a loan these days and when you get one, the interest rate is much higher than it was four years ago. This also applies to airlines.

So, the strike "helps" airlines to defer or cancel deliveries. It also "helps" Boeing to lower production rate without difficult discussions with airlines.

If the current traffic trend continues (see this link) the industry will need to further reduce airplane production output in 2009, with possible layoffs as a consequence.

If capital availability remains difficult, I expect to see white tails blooming in Boeing's and Airbus' facilities next year.

Ted Proske (St Louis, MO USA):

I think the union has made an error in rejecting this contract offer because:

1) it is the best offer in the industry
2) the reason they rejected, as I understand it, is because they want 'job security' in writing. But I don't know how the company can guarantee more than is already in the previous contract; if the company agrees that they will not send any more work overseas, then we won't get any more foreign contracts because part of those contracts is a requirement that a certain % of the work on 'their A/C' will be transferred to their 'in country' companies, and if we refuse to do it, they'll buy 'their A/C' from a company that WILL transfer work and we'll wind up losing more jobs because of no work to do, than we would lose if we got the contracts and sent work overseas.

Chris C (South Africa):

It’s a great disappointment that Boeing and the IAM could not reach a common ground agreement that would’ve avoided this very costly and embarrassing strike! The aviation industry can ill-afford having the world’s largest, most reputable commercial airplane manufacturer, Boeing, embroiled in industrial action against it from 27,000 of its mechanics.

These are critical times for Boeing and the aviation world. The super-efficient 787 Dreamliner should’ve been some four months into commercial airline service already, not still housed firmly within the massive Everett factory still going through pre-gauntlet run checks!!

Indeed, safety is paramount, and only once the 21st century game-changing 787 Dreamliner is ready to fly, then it’ll fly. Apart from the 787, which the aviation world needs now, Boeing can not risk disrupting the 747-8 and 777 programmes! I would’ve thought it would have been of paramount importance that a strike would be avoided at all costs.

Then again, maybe the IAM leaders also need to look at what damage could be done to Boeing, and what rewards IAM and other employees could reap in a year or so from now when the 787 is in service, finally, with the 777F and with the -8F service entry imminent. I think both parties are to blame for this, but really, couldn’t IAM agree somewhat with the current BAFO, and re-negotiate certain other aspects, and call a strike then if necessary, once the 787 was already in testing?!

I can’t understand why IAM rejected the offer from Boeing, if Boeing claims that it is the best in aviation industry! C’mon people, let’s resolve this so you can get back to building the finest commercial airplanes in the world.

Paulo M (Johannesburg, RSA):

It looks like the United States presidential election will be decided by many of the issues faced by these people, issues such as cost of living, living standards, health care, job security - these are issues affecting the entire nation, not just regions where the Boeing Company has a presence. As a matter of fact, these are issues which affect many countries around the world. Of course, maintaining an acceptable standard of living or even improving it slightly is very important.

One of the things I find is that the cost of living in the Seattle-area is probably high for reasons beyond the oil markets. This is a region that has done relatively much better commercially in recent years than, say, the Detroit-area. Continuing to live comfortably in these areas perhaps needs greeter co-operation.

Balancing that and this company's need to stay efficient to be able to compete internationally was always going to be tough.

Norman (Long Beach, California, United States):

It is unfortunate that this strike has taken place,
I hope all opportunity is used on both sides to resolve this dilemma as soon as possible.

TC (Mt. Vernon, WA):

I agree with Paulo M that the issues extend beyond Boeing and it's workers.

It would be nice to see the State of Washinton reward great employers like Boeing who do pay health insurance. Some employers pay no health care costs and by default the state is stuck with the tab. All employees in Washington deserve some of the public health care funds.

Robert Richman (Los Angeles, CA):

Hi Randy,
Given the stoppage, i thought this might help in terms of insight to workplace culture. It's the Bnet video for Tribal Leadership, a book about the stages of employee mindsets.

hope it helps.

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