Boeing machinists went on strike after refusing a 25% pay raise, shutting down the manufacturing plant.
Here are the key points from Boeing’s CFO statement:
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Impact of the strikeThe strike would jeopardize the recovery process, and affect production and deliveries.
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save money:Strong focus on measures to preserve money
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Union negotiationsI want to go back to the table and reach an agreement.
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Production goals:Reaching 38/month by the end of the year will take longer.
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Stock levelsAbout 70 aircraft remain in stock at the Shadow Factory.
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supply chain constraintsWidespread impact on the industry, affecting deliveries
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Specific effects on production:
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Defense UnitQ3 margins will be negative
The last strike lasted 58 days.
Fitch has now stated that if the strike is extended, it could impact Boeing’s ratings (downgrading them to junk status).
Shares were down 3.1% at $157.80. For the fiscal year, shares are down about 40% on the year.
Boeing’s negative headlines are far from Intel’s. Its shares are down about 61% on the year. The third-worst performing Dow stock is Nike, down -27.6% in 2024.
Note: Moody’s has now joined Fitch in keeping the rating on negative watch.