Acting US labour secretary to meet with Boeing and union to end impasse

U.S. Acting Labor Secretary Julie Su traveled to Seattle to meet with Boeing and the union representing approximately 33,000 striking workers in an effort to bring both parties back to the negotiating table, Reuters reported, citing an anonymous source.

Su’s involvement comes as Boeing faces a five-week-long strike that has prompted the company to announce plans to cut 17,000 jobs and absorb a $5 billion hit due to disruptions across its operations. It remains unclear whether Su will also meet with Boeing CEO Kelly Ortberg, the source said.

The U.S. Department of Labor confirmed Su's visit on Monday.

“Acting Secretary Su is meeting with both parties today to assess the situation and encourage progress in the bargaining process,” a spokesperson said.

Boeing and the International Association of Machinists and Aerospace Workers (IAMAW) have not yet commented, and the White House also declined to provide a statement.

Shares of Boeing fell by 3% in early trading following the company’s unexpected announcement after markets closed on Friday. Boeing disclosed a further delay to the 777X jetliner, now set to debut in 2026, and the termination of its civil 767 freighter production.

This week, Boeing will hold internal meetings to outline its workforce reduction plan, which industry sources suggest could include involuntary layoffs to reduce costs while retaining key talent.

“The challenge will be to avoid losing the top 10 percent of workers you need to keep, which is especially critical in today’s post-pandemic skill shortage,” said Nick Cunningham, an analyst at Agency Partners.

Client Frustration

The delay of the 777X, which will now enter service six years behind schedule, has sparked frustration among customers. Emirates Airline President Tim Clark, whose initial order for 150 units was pivotal to the jet’s launch, expressed his discontent.

“Emirates has had to make significant and costly adjustments to our fleet programs due to Boeing’s repeated contractual failures,” Clark said in a rare written statement. “We’ll be having serious discussions with them over the coming months.”

Clark also criticized Boeing’s updated delivery timeline, questioning its credibility given the suspension of a key certification test and the ongoing labor strike. “I don’t see how Boeing can reliably forecast delivery dates,” he remarked.

Emirates, the largest operator of Boeing’s 777 jets, has been heavily affected by delays to the aircraft's successor and the ongoing production issues plaguing Boeing’s 737 program.

Financial Impact

Friday’s announcement also revealed more than $10 billion in gross cash, which analysts say will provide Boeing some relief in the short term. However, the company is still expected to raise additional funds by the end of the year.

JP Morgan analysts noted the cash injection would give Boeing some leverage in its negotiations with the machinists union. Reaching an agreement is critical for Boeing, which relies heavily on 737 production for cash flow.

Credit rating agency S&P has warned that Boeing could lose its investment-grade rating if the situation worsens.

Meanwhile, the union criticized Boeing’s decision to halt 767 freighter production, calling it “troubling” and dismissing the company’s portrayal of the labor negotiations as unfounded.