Boeing reports quarterly loss of $6 billion ahead of union vote

EVERETT, Wash. (AP) — Boeing factory workers voted Wednesday to approve it a contract offer These include large salary increases but lack a traditional pension plan or the continuation of one Strike that crippled the company's aircraft production for almost six weeks.

The vote began just hours after Boeing announced that it had suffered a loss of $6.2 billion in the third quarter huge write-offs both in the aircraft and defense businesses.

Members of the International Association of Machinists and Aerospace Workers voted at union meetings in Washington state, Oregon and California on a Boeing offer to increase wages by 35% over four years, a one-time ratification bonus of $7,000 pay per worker and restore wages would be annual productivity bonuses worth several thousand dollars each.

Before the doors opened at a hall near the Boeing factory in Renton, Washington, workers lined up outside to receive occasional calls Keep the strike going.

“It will be a split vote,” predicted Brian Hatcher, who has worked at Boeing for 15 years and said he voted to reject the offer largely because this is the case Don't bring pensions back that were frozen a decade ago.

Theresa Pound, a 16-year Boeing veteran, also voted against the deal. She said the health plan has gotten worse, with higher premiums and more out-of-pocket costs, and her expected retirement benefits won't be enough, even when combined with a 401(k) retirement account.

“I put more time into this place than I ever should have. I literally have blood, sweat and tears from working at this company,” said the 37-year-old. “I'm thinking about working until I'm 70 because there's a chance I might not retire due to market trends.”

Frederic Scholter, an airline inspector who worked at Boeing for 48 years and experienced six strikes, voted yes.

“I think if Boeing gives us good money to invest ourselves, it's up to you to plan your retirement that way,” he said. “It wasn’t a good contract at first. I think this contract meets us halfway.”

The union said it expects to announce the results of the vote on Wednesday evening. Union leaders, who were burned last month when they supported an earlier proposal that members rejected by 94.6%, did not support the latest proposal but said it deserves consideration.

If the contract is accepted, the 33,000 striking Boeing employees would return to work between Friday and October 31.

The strike, which began on September 13, served as Boeing CEO Kelly Ortberg's first test became managing director in August.

In his first remarks to investors on Wednesday, Ortberg said Boeing needed “a fundamental culture change” and laid out his plan to revive the aerospace giant after years of heavy losses Damage to reputation.

Ortberg reiterated in a message to employees and on the conference call that he wanted to “redesign” the relationship between management and workers “so that we are no longer so far apart in the future.” He said business leaders need to spend more time on factory floors to know what's going on and “prevent problems from festering and work better together to identify, resolve and understand the root cause.”

Ortberg, a Boeing outsider who previously ran Rockwell Collins, a maker of avionics and flight controls for airline and military aircraft, said Boeing is at a crossroads.

“Confidence in our company has waned. We have too much debt. We have had serious performance deficiencies across the company that have disappointed many of our customers,” he said.

But Ortberg also highlighted the company's strengths, including a backlog of aircraft orders worth half a trillion dollars.

“It will take time to return Boeing to its former heritage, but with the right focus and culture, we can once again be an iconic company and a leader in the aerospace industry,” he said.

In recent weeks, Ortberg announced Mass layoffs – about 17,000 people – and a plan to go with it raise enough money to avoid filing for bankruptcy.

Boeing hasn't had a profitable year since 2018, and Wednesday's numbers marked the second-worst quarter in the manufacturer's history. Boeing lost $6.17 billion in the period ended Sept. 30, an adjusted loss of $10.44 -dollars per share. Analysts surveyed by Zacks Investment Research had expected a loss of $10.34 per share.

Sales totaled $17.84 billion, in line with Wall Street estimates.

The company burned through nearly $2 billion of cash in the quarter, weakening its balance sheet, which is burdened with $58 billion in debt. Chief Financial Officer Brian West said the company would not generate positive cash flow until the second half of next year.

Shares of The Boeing Co. fell 2% in regular trading Wednesday.

Boeing's fortunes deteriorated thereafter two of its 737 Max jetliners crashed in October 2018 and March 2019, killing 346 people. Safety concerns arose again in January of this year when a panel on a Max blew off during an Alaska Airlines flight.

Ortberg must convince federal regulators that Boeing will fix the problem Safety culture and is poised to ramp up production of the 737 Max – a crucial step to raise much-needed cash. However, this cannot happen until the striking workers return to their jobs.

Boeing steadfastly resisted the union's demand to restore a traditional pension plan that was frozen in 2014. However, workers who were covered by that plan would receive a slight increase in their monthly pension payments under the latest offer.

“Pension should have been the top priority. “We all said this was our top priority, along with pay,” Larry Best, a customer quality coordinator with 38 years at Boeing, said on a picket line outside a Boeing factory in Everett, Washington, on Tuesday. “Now is the best opportunity at the best time to get our pension back and we all need to stay out and get involved.”

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Lindsey Wasson in Everett, Washington, contributed to this report. Koenig reported from Dallas.