Bloomberg Audio Studios, podcasts, radio news. Boeing the worst performer in the Dow Industrials. Moody says, it's putting the playmaker on review for a possible downgrade to junk status. And of course this is as thirty three thousand workers in the Seattle area rejected the latest labor deal and voted to strike. They walked off the job this morning.
Yeah, the International Association of Machinists and Aerospace Workers walking off the job here. Kind of a blow here for a new CEO that's really been on the job for less than two months. Here we do talk about that strike and what the effect is on Boeing, and we're going to continue that story right now with the head of their union. We welcome in right now our Bloomberg audiences across all of our platforms, a discussion here about those thirty three thousand workers walking off the job.
We're joined right now.
By the lead negotiator of those talks on the labor union side, John Holden. He's president of IAM District seven five one. John, Thanks for being here on the day we were looking at a twenty plus percent pay raise down the lad line for workers that was rejected their original plan or the original proposal that had come out of the labor union side. What was that percentage and do you think you're going to get there?
You know, thank you for having me.
You know, our members have worked hard over the last ten years to place themselves in a position of leverage.
It's been a long road.
We haven't renegotiated our full contract since two thousand and eight, so there's a lot to address. We've certainly, you know, had some tough times when our membership was threatened with job loss and moving jobs away from our production facilities here in Washington, and so there are some pretty deep wounds that our members had to work through. We proposed over forty percent wage increases, and you know, our members certainly deserved those those wages, but there's many other things
as well. We have also lost our defined benefit pension, there was a mass cost shift on healthcare, and there's many other issues that our members are looking to address, and we're going to work hard to do that.
They're confident, they're ready.
They've put themselves in the strongest leverage position possible at the right time.
So that's where we're at.
What's the relationship right now? Like John, with management at Boeen, particularly at the executive side, do they seem meanable to maybe compromising on some of these issues.
Well, we'll see, we'll see.
I know they're going through their own issues, but I will tell you that I'm focused solely on what our members need, what their priorities are, and we need more and we're going to definitely push that forward.
John.
We know the White House has been in touch with both Boeing and the union. Is that helpful to you? Have they been able to move the needle in any way?
You know, we'll see. That remains to be seen, I hope so. But at this point, you know, we're going to talk with our members. We just are getting our picket lines up and running. It will be a little chaotic for the first few days here as we get into a well oiled machine sending a strong message.
Our members united, a massive rejection.
Of the contract and a massive vote to go on strike at ninety six percent. So you know, our members are united across all of our demographics, whether they've worked here for a few months or for forty five years, everyone's united, and we intend to go after the items that our members deserve.
So I would like you to be able to outline for us at the next steps for you from where you say, do you plan to head back to the bargaining table this weekend?
FMCS is involved in is calling both sides to come back to the table. So we're working through some of those items. We will certainly get back to the table as quickly as we can. We also have to talk to our members since the strike was called last night at midnight, we still have some engagement we need to do so that when we go back to the table we can propose the items that we feel we can make headway on to get a deal done. So we have a little bit of time and hopefully early next week.
Are you in a position, meaning the union, are you in a position right now to provide support for work or should this strike be prolonged.
Yeah, we have a very strong strike fund and our members will be eligible for that.
There's a lot of opportunity for our members.
We've spent the last five years talking about saving for this, you know, putting into your individual strike fund, preparing so that we could stand on principle and make sure that financial decisions aren't what will you know, make people decide whether they can accept an agreement or not, but standing on principle so that we can all move ourselves forward.
I'm wondering if you could go back in time for me, John, to the line as contract, the last negotiations, and why you feel now that that maybe came up short. I know that you have the benefit of hindsight of being able to judge what was done then, but what could have been done differently that maybe would have put or maybe made you feel a little bit better about the contract situation today.
Well, a lot of.
This is coming from an extension that happened in twenty thirteen fourteen, and in that extension, you know, our members did lose their defined benefit pension. They were threatened that, you know, a major portion of their work would be sent somewhere else for thousands of our members, you know, threatening thousands of their families. In our community, we had a massive cost shift on healthcare, and we also had stagnated wages over the last eight years, eight to ten years.
And that was on the heels of being threatened that the seven three seven Max aircraft would also be built somewhere else unless we agree to an extension and a car shift of healthcare at the time, so there's some deep wounds that we're trying to kal.
And I believe this agreement had it been off of.
A previous agreement from three years ago or something, might have been perceived different. But this was just a bridge too far, and our members are fighting for what they deserve, and there's many issues that we're trying to address. It's hard to pick just one, but that's what kind of led to this overwhelming vote to strike.
Thank you for providing the context there. I understand that the union has requested mediation for the negotiations. How does this process change with a mediator from the NLRB leading the discussions. Does it, I don't know, prevent or rule out the chance of a quick resolution the way that we saw at the Boeing supplier Spirit Aerosystems.
Well company reached out to FMCS Federal Mediation and Conciliatory Services, and so we want to get back to the table as well. That's our job is to reach an agreement that provides a better agreement for our members. I think there are benefits to having mediation, and hopefully those can work, but it doesn't deter us from addressing the needs that
our members have set, they have spoken loudly. They are standing shoulder to shoulder, speaking with one voice, and we are determined to make the demands to make the improvements that they're demanding.
So, as you know, Bloomberg Television speaks to or we. Our audience is analysts, whether it's equity analysts or credit analysts, and investors, bond investors and equity investors. What is your message from the union to this audience. What do you want them to know?
It's not usually a group of folks that I talk to a lot, so kind of the message that I gave the company I might give to them. You can either meet the demands of our membership now, it can cost more later. I think it's important that we resolve this as quickly as we can if they take seriously our proposals, it's what our members have earned and deserved, and I think that's the best way to resolve this quickly.
And just real quickly. Here too, there's been a lot of talk anytime you have these big labor strikes, it's not always just about the workers at that particular company, particularly with an ecosystem like making airplanes. Here, this is going to have reverberations for other companies, even restaurants and other things in the area.
Here.
Have you had any discussions at all with other workers and those lines of work, other business leaders and those areas small business leaders about how they're going to get through this should this extend for some period of.
Time, Well, we've had discussions with the community at.
Large for the last couple of years.
In fact, you know, our efforts to fight for job security are fighting for certainly our members to have jobs long into the future, but that also brings jobs for everyone else, the other Boeing employees that aren't represented by the IM, those in the community that are in the aerospace supply chain, that have committed their lives to you know, be in aerospace and help aerospace thrive, and in everyone else that's benefited from these good jobs in the community.
So it's been a it's been a fight not just for ourselves but for everyone else to ensure that we have long term jobs long into the future.
John Holden, President of IAM Districts seventy five to one, thank you so much for spending some time with us and explaining your side