While the offer included a pay raise, and signing bonus, it lacked a defined benefit pension, which the “JCs” took away from Boeing machinists 10 years ago.
After the vote, union leaders said they were ready to immediately resume negotiations with Boeing on the first new contract since 2014, when the company used the threat of moving production of the new version of the 777 out of the region to push through a deal that ended traditional pensions.
Boeing factory workers were also venting frustration after a decade when their wages have lagged inflation while the planemaker spent tens of billions of dollars on share buybacks and paid out record executive bonuses.
The Proles get rogered, while the “JCs” are protected, so, after the bailout, the “JCs” can continue looting the company.
A thought occurred to me today. Boeing used to own Spirit Aerosystems. Spirit was spun off some years ago. Now, Boeing is in the process of buying Spirit back. Spirit makes 73 fuselages, as well as other parts, and a lot of structures for Airbus. Once reconsolidated into Boeing, how eager will Airbus be to continue buying from Spirit? The Renton plant, where the 73 is final assembled, is only 1.1M sq ft. Spirit’s facilities are bigger than Renton. So Boeing offers the Seattle area workers a raise, but then closes Renton and moves 73 production entirely to Spirit. Spirit is a union shop, but the cost of living in Seattle is some 60% higher than Wichita, so I bet Spirit’s wage structure is lower.
Meanwhile, the 74 is done. The 76 is close to end of life. 77 orders are running at half the rate of a few years ago. So the Everett plant is running well below capacity. Bet the plan is to close Everett too, and move 77 production to Spirit.
This article implies Airbus had some interest in Spirit. Airbus is paying $1 for some part of Spirit, and is being compensated $559M, so sounds like Spirit’s production slate will be 100% Boeing.
In the long run, Boeing management doesn’t care about the commercial sector. They have already lost half the commercial market share they had a few years ago. Management is clearly intending to make their loot by leaching off of DoD, like Lockheed does. So, consolidate commercial at Spirit, where it can be wound down efficiently.
Interesting. Most of their defense business is in St. Louis from their acquisition of McDonnell-Douglas. That business is profitable. And not on strike.
Now that they are selling off subsidiaries to raise cash it will be interesting to see how it goes. Selling off the defense business might be one possibility. Saleable as it is profitable. But maybe better for mgt an their bonuses to sell off passenger planes and keep defense.
Given that Boeing has moved HQ from Chicago to DC, and does not seem to care about commercial market share, I think their plan going forward is to carve the company down to McDonnell and Vertol, because DoD will tolerate sloth and corruption that a for-profit airline would not.
So consolidate the 77 and 73 at Spirit, which already produces the 73 fuselage, so they can pay the employees less, and wind it down. That still leaves the non-union plant in South Carolina, which does such a sloppy job of building 78s. The SC plant would probably take over the defense business from St Louis and Ridley Park, after the 78 is wound down, so, while they charge DoD a fortune for “development”, they can pay the Proles less.
“The Boeing North American Benefit shall be available solely to participants in the Retirement Income Plan for Certain Salaried Employees (Sub-Plan No. C03 of the Boeing North American Retirement Plan) (the “BNA Plan”) whose date of retirement under the BNA Plan is between December 6, 1996 and June 30, 1999.”
And union employees previously enrolled in their pension plan retained their benefits.
Defined benefit pension plans lost favor because its an uncontrolled earnings variable. Dips in stock market cause a hit to corporate earnings (and executive bonuses).
They prefer defined contribution, ie 401k. Then individual takes market risk rather than employer.