Boeing has pulled its offer to increase pay as the company and the union reach an impasse.
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Conway Gittens: Fresh record closing highs for the Dow and the S&P 500 on Wednesday. Investors are feeling bullish about artificial intelligence, and tech in general, as Nvidia did a little bit of showing off at its AI summit. Shares of the AI chip leader are trading near all-time highs.
Attention turns to the economy Thursday. The Consumer Price Index for September is due. Meanwhile, Delta Air Lines will release quarterly results and Tesla will finally unveil its long-awaited Robotaxi.
Sticking with corporate news: Talks to end the month-long strike at Boeing have broken down and are not slated to resume at this time.
Boeing seemed especially frustrated with the union representing roughly 33,000 striking machinists. A Boeing executive told employees in a note,“Unfortunately, the union did not seriously consider our proposals.” As a result, Boeing has ripped up an offer it called its “best and final,” that would’ve boosted pay by 30 percent.
The union, however, is not backing down. Union members are holding out for a 40 percent raise as part of a long list of grievances .“They refused to propose any wage increases, vacation/sick leave accrual, progression, ratification bonus, or the 401K Match” the union told Reuters, adding, “They also would not reinstate the defined benefit pension.”
The strike has pushed Boeing deeper into the red. It’s estimated to lose $1 billion a month, according to S&P Global Ratings, on top of the $60 billion debt load it is already carrying. With production shut down, Boeing is being forced to furlough workers. It is also exploring money-raising efforts to remain afloat, while the picket line proves to be an impenetrable force.
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