The Boeing union will vote on a possible contract to end the strike

Boeings (B.A+2.77%) The future could depend on Wednesday's vote to ratify the union. Over the weekend, the International Association of Machinists and Aerospace Workers (IAM) told its members Companies involved in the walkout say they will decide this week whether to accept an agreement put forward by the company that includes a 35% wage increase.

“The future of this contract is in your hands,” the union told members. “Thank you for your continued input and support throughout this process.”

The aircraft maker's long, slow recovery from years of scandals could take even longer and become more expensive if striking machinists reject the company's latest contract offer.

The offer is better than what Boeing should offer.best and final offer” a 30% increase, likely the result of incumbent Labor Secretary Julie Su come into town. Still, it's less than the 40% increase workers were seeking. In addition, the offer does not include restoration of the previous pension A sticking point in the negotiations.

The strike has been going on for more than a month, the point some observers believe Boeing is at fault A cash outflow of $50 million per day will be particularly difficult for the company. After early dismissal of employeesBoeing has since excluded the striking workers from the company's health insurance plans and announced plans to do so Laid off 10% of its workforce.

However, the manufacturer announced plans to raise up to $35 billion in new cash (on top of the $10 billion it had raised). Earlier this year), uncertainty about the state of labor relations at Boeing could further complicate the situation a very complicated maneuver.

After two fatal plane crashes In 2018 and 2019, Boeing struggled to restore public confidence, production and revenue. Then, in January, a piece of hull fell out of a plane Just as the company was about to start its comeback run after the COVID-19 pandemic. After the Federal Aviation Administration (FAA) imposed this a rolling production rate cap To allow Boeing to address the quality control issues, Chief Financial Officer Brian West said the company would ship it Billions of dollars in cash get out the door for a while without any loss of income.

Then the strike halted production of most of the aircraft that made up Boeing's backlog. The company's much-needed investment grade credit rating hangs by a threadand a loss would make the road to recovery steeper and more expensive if Boeing had to borrow more money along the way. Fitch Ratings said last week that Boeing's fundraising efforts “support liquidity amid ongoing operational challenges” – but with a caveat.

To get back on track, Fitch said, Boeing would need to resolve its strike by the end of the year so it can focus on building up its production capacity for the key 737 Max model, which was difficult to build because of the FAA's speed limit even before the work stoppage of machinists introduced. No contract would throw a big question mark into the equation.

“Fitch continues to assess the company's ability to maintain our negative rating sensitivity,” the ratings agency said.