Boeing's U.S. factory workers on strike after rejecting pay increases of 25% over 4 years

Workers at Boeing’s U.S. West Coast factory walked off the job early Friday after 96 percent voted in favor of a strike, halting production of the company's best-selling aircraft as it grapples with ongoing production delays and increasing debt.

This marks the first strike by Boeing workers since 2008 and comes just weeks after new CEO Kelly Ortberg took over in August to restore confidence in the company, following an incident in January where a door panel blew off a nearly new 737 MAX jet mid-flight.

Approximately 30,000 members of the International Association of Machinists and Aerospace Workers (IAM) in Seattle and Portland, who work on Boeing’s 737 MAX and other jets, voted overwhelmingly to strike after rejecting the company’s proposed contract — the first full contract offered in 16 years.

“This is about respect, about addressing the past, and about fighting for our future,” said Jon Holden, who led the negotiations for Boeing’s largest union, before announcing the strike vote on Thursday evening. He declared, "We strike at midnight," prompting cheers of "Strike! Strike! Strike!" from union members.

Boeing acknowledged the vote on Thursday, saying it clearly showed the proposed deal was not acceptable to the workers. “We remain committed to resetting our relationship with our employees and the union, and we are ready to return to the table to reach a new agreement,” the company said.

The rejected contract offered a 25 percent wage increase, a $3,000 signing bonus, and a commitment to build Boeing’s next commercial jet in Seattle if the program launched within the four-year contract period. Despite IAM leadership urging members to accept the deal, many workers were upset, demanding the originally proposed 40 percent pay raise and lamenting the loss of an annual bonus.

“We’ll get back to the table as soon as possible,” Holden told reporters, without specifying how long the strike might last. “This is something we will take one day, one week at a time.”

Boeing shares closed 0.9 percent higher on Thursday before the strike vote results were revealed but have fallen 36 percent this year due to concerns over safety, production delays, and a $60 billion debt load.

The strike presents Boeing with several challenges. The company must decide how to respond during negotiations, having already said it offered the best possible deal. It also needs to secure factories filled with valuable, partially assembled planes without its union workforce.

In a letter to workers on Wednesday, CEO Ortberg warned, “A strike would jeopardize our shared recovery, further erode customer trust, and damage our ability to shape our future together.”

If prolonged, the strike could significantly impact Boeing's financial health, as well as airlines that rely on its jets and suppliers that produce components for its aircraft.

Air India CEO Campbell Wilson said on Friday that Boeing’s 737 MAX deliveries to his airline were already "delayed a little bit" due to regulatory scrutiny following the Alaska Airlines incident and broader supply chain issues. “Nothing official yet, but the expectation is that it will be a little later,” he said in an interview from Sydney.

A note from TD Cowen before the vote estimated that a 50-day strike could cost Boeing between $3 billion and $3.5 billion in cash flow. The last Boeing strike in 2008 lasted 52 days, costing the company an estimated $100 million in daily revenue.