:Boeing shares rose 3.9 per cent on Friday, as some analysts expressed optimism that the U.S. planemaker’s latest pay offer to end a damaging strike by about 33,000 workers will muster enough support on Monday.
The proposal boosts wages by 38 per cent over four years, sweetening an earlier 35 per cent offer, and adds a $12,000 ratification bonus, even though Boeing did not meet workers’ demand for a return to a defined-benefit pension. Boeing workers are set to vote on Monday after rejecting two previous offers.
“It looks promising since it is approaching the union’s original target of a 40 per cent wage increase over four years. The fact that the strike has lasted almost two months is also a factor in favor of a deal,” said Ben Tsocanos, aerospace director at S&P Global Ratings.
The seven-week strike has halted production of Boeing’s best-selling 737 MAX jets as well as its 767 and 777 widebodies, leading to a $6 billion loss in the third quarter and complicating CEO Kelly Ortberg’s turnaround efforts.
Wall Street analysts have been scanning Reddit posts and social media reactions to gauge workers’ sentiment, after such sentiment turned out to be a harbinger of the outcome of the previous two votes.
The new proposal has led to mixed reactions from workers who spoke to Reuters. The machinists union has said it has extracted everything it could, while warning that future offers maybe regressive.
“The proposal’s economics are a material improvement for labor. Union leadership’s endorsement, unlike the most recent proposal, should help further bridge the vote towards ratification,” said Dino Kritikos, managing director at Fitch Ratings.
Workers have the option of putting a lump sum of $5,000 from the bonus into their 401(k) retirement account or take cash.
That option, coupled with the possibility that workers could see 20 per cent of their
