From Money Morning Staff Reports
The International Association of Machinists and Aerospace Workers Union will vote this Saturday on whether to end its two-month strike against The Boeing Co. (BA). A tentative agreement to end the strike was reached Monday.
Boeing’s shares soared $6.55 each, or 15.5%, to close at $48.91. They are still down 50% from their 12-month high of $98.71 and are down 45% for the year.
It was the longest strike in 13 years: The union walked out for 28 days in 2005 and 69 days in 1995.
Both sides claimed victory this time around.
The union said that it “won the battle and made some significant gains,” while Boeing claimed it had “retained the flexibility necessary” to manage its business, Reuters reported.
Saturday will be the 57th day of the walkout by unionized machinist workers, who have shut down Boeing’s commercial-jetliner-assembly business since they left their jobs on Sept. 6., in a dispute over contract provisions related to health-care benefits and job security.
The machinists had initially wanted a 13% pay raise over three years and to rewrite certain language in the contract relating to outsourcing. The agreement reached Monday gives workers a 15% raise over the four-year life of the contract and gives the union more scope for challenging Boeing's use of outside contractors.
Boeing originally predicted the strike would last about a month, Money Morning reported. Back in mid-September, Tom Buffenbarger, the union’s national leader, told The Seattle Times that if the strike costs Boeing $100 million a day in lost sales – as many Wall Street analysts estimated – it would take strikers one month and one week to drain Boeing’s $10 billion cash reserve.
The union represents about 25,000 Boeing production workers in and around Seattle, another 1,500 in Gresham, Ore., and 750 in Wichita, Kan, TV station KXMB in Bismark, N.D. reported.
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