(VOR News) – Boeing’s Chief Financial Officer, Brian West, recognised that the worker strike, which started just after midnight on Friday, will negatively impact aircraft deliveries and “put the recovery of the company in jeopardy.”
This state of affairs resulted from the industrial workers’ massive walkout and rejection of a new labour contract that the corporation was offering.
Resuming talks in order to “reach an agreement that is good for our people, their families, and our community” is Boeing’s primary goal at the moment, according to West. This is the main goal that wants to accomplish.
Boeing’s stock fell by nearly four percent on Friday after the company announced that it would be going on strike.
Fitch Ratings has warned that an extended strike may increase the likelihood of a downgrade, which could raise the cost of borrowing money. Moody’s has placed all of Boeing’s credit ratings under review for the possibility of a downgrade. Every one of Boeing’s credit ratings is being reviewed by Moody’s.
Boeing’s debt is rising and will get worse.
Regarding Boeing’s ability to meet its goal of producing 38 737 Max aircraft per month by the end of the year, West did not provide any confirmation. West withheld any information pertaining to this attempt. According to Sheila Kahyaoglu, an aerospace analyst at Jefferies, Boeing might lose up to 1.5 billion dollars in the event of a thirty-day strike.
A tentative labour deal was put out by Boeing and the International Association of Machinists and Aerospace Workers as a possible fix. A twenty-five percent pay raise spread over four years is also part of the agreement, along with adjustments to healthcare and retirement benefits.
Conversely, employees demanded a forty percent salary rise, claiming the offer was inadequate in light of the rising cost of living. They were also asking for an increase in the offer.
Ninety-six percent of workers supported the strike, which started on Friday just after midnight, while ninety-four point six percent of workers opposed the idea.
The production of Boeing’s 737 Max aircraft, which are produced in Renton, Washington, and are sold to a wide range of consumers, is anticipated to be impacted by the strike.
“The strike will have an impact on production and deliveries as well as our operations, and it will put our recovery in jeopardy,” West declared in a statement. West wrote his statement in reaction to the walkout.
Boeing’s future goal is to cut cash outflows, he said.
The objective that will be pursued is this. Additionally, Kelly Ortberg, the newly appointed Chief Executive Officer of Boeing, will work hard to mend the company’s relationship with the union.
Boeing, which has already been coping with a number of production problems and safety concerns, is anticipated to encounter more difficulties as a result of the strike.
The Federal Aviation Administration (FAA) decided in January to stop from increasing the production of its Max aircraft due to a door plug leak that occurred on a virtually new Boeing 737 Max 9.
Additionally, Boeing had to work to raise its quality and safety standards since the Federal Aviation Administration (FAA) increased the number of inspections conducted at its operations.
Inspectors would stay at installations for the duration of the strike, the Federal Aviation Administration (FAA) said on Friday. The most recent strike by machinists took place in 2008, and it caused a work halt that lasted about two months.
SOURCE: BPM
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