U.S. Acting Labor Secretary Julie Su met with Union as strike by factory workers at Boeing entered the fifth week, and the company announced plans to cut thousands of jobs and take on $5 billion in charges.
The Labor Department confirmed that for the first time Su will be meeting the Boeing union and workers in person, Reuters reported.
IAM District 751 President Jon Holden updated Su on the talks, "stressing the Union's commitment to a negotiated contract that values our members' skills and dedication."
Holden, as per the Union's official X handle, took a deep dive, explaining the relationship and past struggles with Boeing, which continues to impact these talks in 2024.
"After meeting with Holden, Su spoke with the bargaining team to better understand the negotiation roadblocks. The team made it clear: our members take immense pride in the work they perform and the products they build. We look forward to negotiating a contract that recognizes their worth," the post on X said.
Boeing has announced it will cut 17,000 jobs and to issue 60-day layoff notices next month to thousands of employees in its commercial aviation division. The company plans to implement the layoffs in mid-January.
A spokesperson for the Society of Professional Engineering Employees in Aerospace (SPEEA) said that Boeing informed the union on Monday that 60-day notices for its engineering division will be sent on Nov. 15.
The company plans to issue a second round of notices in December, if further reductions are needed.
Nearly 33,000 Boeing factory workers have been on strike since September 13, demanding a 40% wage increase over the next four years.
Boeing plans to avoid voluntary departures in order to minimize severance costs and safeguard essential skills. Instead, the company will rely on involuntary layoffs.
Last week, Boeing filed an unfair labor practice charge with the National Labor Relations Board accusing International Association of Machinists and Aerospace Workers (IAM) union of negotiating in bad faith and misrepresenting the plane makers' proposals.
The strike has cost Boeing more than $1 billion a month, according to S&P Global Ratings estimates.
The surprise job cuts were announced together with alongside preliminary financial results that revealed huge losses for Boeing. According to Seattle Times report, IAM members will not be included in the 10% of Boeing workers facing layoffs for the time being.
The company expects to lose nearly $10 per share for the third quarter and to incur around $5 billion in charges across its commercial and defense divisions. Boeing hasn't posted an annual profit since 2018. CEO Ortberg will face investors for the first time in his full earnings call on Oct. 23, CNBC reported.
Meanwhile, the delivery of Boeing's 777X, the successor to the 777 mini-jumbo, has been pushed back by another year to 2026 mainly due to issues with certification and testing, which have held up the aircraft's production and approval.
Meanwhile, Boeing currently holds just over $10 billion in gross cash, a figure that analysts believe will help bring down some of its short-term financial pressure. However, they added that the company will still need to raise additional funds by the end of the year.
U.S. Secretary of the Army Christine Wormuth, however, stated that layoff announcements by the company will not affect its programs, which include helicopters and munitions.
Boeing's shares were down by nearly 43% this year through Monday's close, the steepest drop since 2008. They closed Monday's regular trading session at $148.99, down 1.34%.
