Wall Street Breakfast Podcast: Boeing Aims For Union Deal

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Boeing (BA) reaches deal to end machinist strike. (00:27) Aurora (AUR) to delay commercial launch of driverless truck until April 2025. (01:28) Abbott (ABT) jumps as jury says company, Reckitt (OTCPK:RBGPF) not liable in infant formula case. (02:17)

This is an abridged transcript of the podcast.

Boeing (NYSE:BA) has reached a deal with leaders of its machinists union.

The company offered a 38% wage increase over four years in its latest proposal, up from last week’s offer of 35% and an original offer of 25%. Both were overwhelmingly rejected.

The latest offer does not bring back pensions, a key demand of many members. Instead, Boeing (BA) would increase company 401(k) contributions.

The company also would keep paying yearly bonuses, which had been eliminated as part of the initial offer. A $12,000 ratification bonus is also included.

The company and its biggest labor union announced the deal Thursday. The union plans to vote on the deal Monday.

The strike has cost the company an estimated $1 billion a month, pushing management this week to raise more than $20 billion in a sale of new shares.

Shares of Aurora (NASDAQ:AUR) fell 21% on Thursday after disclosing a four-month delay in the commercial launch of its self-driving truck.

In explaining the reason for the delay, CEO Chris Urmson said during the company’s Q3 earnings call that additional safety measures need to be completed before he feels comfortable launching the vehicle.

Aurora (AUR) plans to launch the Aurora Drive with a “crawl, walk, run” approach, by deploying up to 10 driverless trucks in commercial operations during the launch, beginning with just one driverless truck before transitioning the balance to all driverless.

In the second half of 2025, Aurora’s (AUR) focus will be expanding product capabilities, adding new lanes, and increasing capacity to tens of trucks by the end of the year.

The company expects to earn a profit by 2026.

Abbott Laboratories (NYSE:ABT) is up 5% in premarket action after a jury found the company and a Reckitt Benckiser (OTCPK:RBGPF) unit are not liable over claims the companies’ baby formula caused a potentially deadly illness.

The jury reached the verdict on Thursday in a St Louis court, according to a Bloomberg report.

The latest jury verdict comes after a jury in St. Louis in late July awarded a plaintiff $495 million in compensatory and punitive damages over claims the company’s baby formula caused a potentially deadly bowel disease.

Abbott Labs (ABT) and competitor Reckitt Benckiser’s (OTCPK:RBGPF) Mead Johnson business are facing more than 1,000 lawsuits that allege that the companies failed to warn parents about the NEC risks with cow’s-milk-based products.

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Catalyst watch:

• Chinese electric vehicle makers NIO (NIO), Li Auto (LI), and XPeng (XPEV) will update on monthly deliveries. Investors will also monitor the monthly Macau gross gaming revenue report, the monthly update on Class 8 truck orders, firearm background check data from the FBI, and discount broker DARTs reports.

• Kellanova (K) shareholders will vote on the acquisition offer from Mars.

• The three-day GENAI SUMMIT Silicon Valley 2024 will begin. Microsoft (MSFT) and Amazon (AMZN) are two of the notable companies that will participate.

• Construction services provider Everus (ECG) will begin trading after being spun off from MDU Resources (MDU). For 2024, Everus expects revenue to be in the range of $2.65 billion to $2.85 billion and EBITDA to be in the range of $220 million to $240 million.

Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are in the green. Crude oil is up 2.7% at $71/barrel. Bitcoin is down 3.8% at $69,000.

In the world markets, the FTSE 100 is up 0.5% and the DAX is up 0.4%. The market in India is closed today for a holiday.

The biggest movers for the day premarket: BJ Restaurants (BJRI) shares plummeted over 6% as higher operating costs, including increased wages and benefits, led the company to a Q3 loss after posting a profit in the prior quarter.

On today’s economic calendar:

• 8:30 am The October Jobs Report will be released. Economists forecast 120K jobs were added during the month, and for the unemployment rate to hold steady at 4.1%.

• 10:00 am Construction Spending

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