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Investing.com -- Boeing was hit by a strike on Monday as roughly 3,200 machinists from IAM District 837 began taking action after rejecting the company’s second contract offer.
Jefferies said in a note that the strike, which began at 12 a.m. CT on August 4, affects around 2% of Boeing’s total workforce.
They explained that it involves employees who manufacture fighter jets, including the F-15 and F/A-18, as well as other defense products.
IAM 837’s rejection follows a seven-day cooling-off period that began July 27 after the union turned down Boeing’s first proposal.
In a statement, union leader Tom Boelling said members “have spoken loud and clear, they deserve a contract that reflects their skill, dedication, and the critical role they play in our nation’s defense.”
Jefferies said Boeing’s latest offer included a 20% general wage increase over four years, with 8% in year one and 4% each in subsequent years.
They added that the proposal also offered a $5,000 ratification bonus, more time off, and pension enhancements. The deal would have brought average annual pay from $75,000 to $102,600, costing Boeing (NYSE:BA) about $70 million, including bonuses.
The latest offer also included a $0.50 per hour attendance bonus and eliminated controversial alternative workweek schedules.
The strike marks the second in less than a year for Boeing after Local 751 machinists walked out in September 2024. That dispute ended with a fourth offer in November, which included a 38% wage hike and a $12,000 bonus.
Shares of Boeing edged lower Monday, currently down around 1.3%, as investors assessed the potential impact of the disruption on defense production.