Boeing shipped 30 jetliners in July, down from an average 37 per month for the first six months of the year. The company has delivered 273 jets out of the planned 380 for 2002. If Boeing's to reach its delivery goal this year, it will have to ship between 26 and 27 jetliners a month between now and the end of the year.
Meeting that goal could be difficult if the company doesn't avert a possible strike from its 25,000 machinists. The March 2000 low point of jetliner delivery for Boeing, when just 15 planes were delivered, was a result of the 40-day strike by Boeing's engineers' union.
Now Boeing is trying to convince its machinists' union to accept what the company calls its "best and final" offer. The machinists' current contract expired this past Sunday night at midnight. Workers did report for work yesterday, in advance of Boeing and union officials' meeting today with federal labor negotiators. Boeing is adamant that it will not renegotiate the contract; union leaders are equally adamant that they won't accept Boeing's offer.
At stake here, from the machinists' point of view, is job security. The union wants Boeing to guarantee jobs tied to a production schedule, revenues, or some other measure. Between a quarter and a third of the union's members have been laid off this year, and it wants to protect the rest. The contract offered by Boeing included pay raises and bonuses, but the company refused to change language concerning job security. Given the state of the commercial airline industry, Boeing likely wants to leave itself room to lay off more workers, if necessary.
A strike from its machinists would certainly hurt Boeing's production for the year, if the company sticks to its goal of 380 jetliners. But given the ill health of the airline industry, the company may not have the demand needed for its goal. Should demand for jetliners further drop this year, a workers' strike may not greatly concern Boeing.
No company welcomes a strike, but for Boeing, the real problem right now is the ailing airline industry, not the workers.