Boeing 737 MAX Assembly Halted Amidst Major Labor Strike
Boeing is currently facing its most significant production crisis in years, as over 33,000 machinists associated with the International Association of Machinists and Aerospace Workers (IAM) initiated a strike on September 13, bringing the assembly of the 737 MAX to a complete standstill.
This strike, marking the first major labor action at Boeing in 16 years, has impacted key production facilities in Renton and Everett, Washington. These facilities are where the company assembles its best-selling 737 MAX, along with the 767, 777, and KC-46 aircraft. The workers have overwhelmingly rejected a proposed contract that offered a 25% wage increase over four years, with a staggering 96% voting in favor of strike action.
In response to the strike, Boeing CFO Brian West expressed concern, stating that the strike “jeopardizes our recovery in a significant way.” This has forced the company to implement cost-cutting measures, which include a hiring freeze, suspended raises and promotions, and potential temporary furloughs. Prior to the strike, the aerospace giant was aiming for a production rate of 38 aircraft per month, a target that was already reduced due to quality issues following the Alaska Airlines door plug incident in January.
The timing of the strike is particularly critical for Boeing, a company already under financial stress and regulatory scrutiny. Analysts are predicting that the work stoppage could last for several weeks, potentially costing the company billions in delayed deliveries and lost revenue.
Source: CNN Business