Boeing proposes 30% wage hike to striking workers, calls it its ‘final’ offer

By Allison Lampert

(Reuters) -Boeing upped its wage proposal to thousands of striking workers on Monday, offering a 30% general wage increase over four years in what it called its “best and final” offer as the strike drags on.

The U.S. planemaker also offered to reinstate a performance bonus, improve retirement benefits and double a ratification bonus to $6,000, if the workers accept by Friday, according to a letter sent to union officials by the company on Monday.

It is unclear if the new proposal will satisfy the 32,000-plus Seattle-area Boeing (NYSE:BA) workers who went on strike on Sept. 13 for the first time in 16 years after roundly rejecting the planemaker’s previous offer.

A union spokesperson for the International Association of Machinists and Aerospace Workers, which represents the workers who build the planemaker’s best-selling 737 MAX jet and other planes, was not immediately available for comment. Last week, IAM International President Brian Bryant said the workers are “ready to fight this as long as they have to, to get the contract that they deserve.”

Boeing has frozen hiring and started furloughs for thousands of U.S. employees to reduce costs. A prolonged strike could cost several billion dollars, fraying the planemaker’s already strained finances and threatening a downgrade of its credit rating.

The strike, Boeing’s first since 2008, is the latest event in a tumultuous year for the company that began with a January incident when a door panel detached from a new 737 MAX jet mid-air.

The earlier tentative deal between Boeing and the union offered a 25% raise over four years and a commitment that a new plane would be manufactured in the Seattle area if it were launched during the four-year agreement.

Boeing has planned for workers to take one week of furlough every four weeks on a rolling basis for the duration of the strike.

The extensive furloughs show new CEO Kelly Ortberg is preparing the company to weather a prolonged strike that may not be easily resolved given the anger among rank-and-file workers who want 40% higher pay and a performance bonus restored.

Boeing shares were up 2.6% in afternoon trading Monday.