Boeing Co Share Price Surge

Investing.com — Shares of Boeing Co (NYSE:BA) rose 4.6% in pre-open trade on Monday following the announcement of a tentative agreement between the aerospace giant and the International Association of Machinists (IAM) Districts 751 & W24.

The contract offer benefits over 33,000 Boeing employees and includes:
– The largest-ever general wage increase
– Reduced healthcare costs
– Improved retirement contributions

These changes address key employee concerns.

Major Highlights

A significant aspect of the deal is Boeing’s decision to manufacture its next new airplane model in the Puget Sound region, where much of its workforce resides.

Boeing’s Chief Executive, Stephanie Pope, stated, “The contract offer provides the largest-ever general wage increase, lower medical cost share to make healthcare more affordable, greater company contributions toward your retirement, and improvements for a better work-life balance.”

This agreement signifies Boeing’s long-term commitment to the region and the employees who have historically contributed to the company’s commercial airplane production.

Context of the Agreement

The tentative agreement represents the first full negotiation between Boeing and IAM Districts 751 & W24 in 16 years. Since the last full contract was ratified in 2008, employees have approved two extensions, with the current eight-year extension set to expire in 2024.

Once ratified, the new contract would likely stabilize Boeing’s labor relations for years ahead.

Analysts at TD Cowen noted, “While unlikely, if IAM strikes, we think it’s realistic to assume the strike’s duration would be in line with the 51 days of the last four walk-outs….” This could extend to two weeks before Thanksgiving, with workers’ $150/week strike fund running low going into the holidays.