The Boeing factory strike has been ongoing for a month, with pressure increasing on the new CEO to resolve the dispute.

• Boeing's CEO Kelly Ortberg assumed the top position during a challenging year for the company.
• In the upcoming months, the company intends to reduce its workforce by 10%.
• As the factory strike reached its one-month mark, Boeing CEO Dave Calhoun stated that the company must prioritize its efforts.
• Boeing's CEO, Ortberg, will meet investors for the first time on Oct. 23.

Since the more than 30,000 machinists rejected the tentative contract, tensions and costs have escalated.

Boeing's new CEO, Kelly Ortberg, is facing additional pressure due to the ongoing strike, which is estimated to cost the company more than $1 billion per month. This strike comes at the end of a challenging year that began with a near-catastrophic blowout of a 737 Max door plug and was preceded by the first of two fatal Max crashes, which put the company in a constant state of crisis.

Boeing's airplane production has been halted due to a standoff between the union and the company, resulting in a loss of revenue for Boeing. Last week, Boeing withdrew a revised contract proposal that the union had previously rejected, stating that it was not acceptable.

According to sources, Boeing officials had expressed optimism to airline customers about reaching an agreement in the weeks leading up to the vote.

The initial tentative labor deal was rejected by workers on Sept. 13, with 95% of the vote being against it.

Harry Katz, a professor at Cornell University's School of Industrial and Labor Relations who specializes in collective bargaining, stated that the union's demand for a pension plan is unlikely to be met. He predicted that the strike could continue for two to five more weeks.

The process of ending the strike has become more complicated, as federally mediated talks fell apart mid-week.

The International Association of Machinists and Aerospace Workers union was accused by Boeing of negotiating in bad faith and misrepresenting the plane makers' proposals in an unfair labor practice charge filed with the National Labor Relations Board on Thursday.

On Friday, Jon Holden, president of IAM District 751, urged for negotiations to resume.

"Instead of relying on the same old labor relations tactics to intimidate and crush opposition, CEO Ortberg has an opportunity to do things differently," he stated. "Ultimately, it is our membership that will decide whether any negotiated contract offer is accepted, as they seek a resolution that addresses their specific needs."

Unlike the last Boeing factory strike in 2008, Boeing's unionized machinists are not receiving paychecks and lost their company-backed health insurance at the end of September. However, there are more contract work opportunities in the Seattle area to help workers fill the gaps. A union message board posts job opportunities like driving for food delivery services and warehouse work.

Slashing workforce

Ortberg announced that the company will reduce its global workforce by approximately 10% "in the near future," which will involve layoffs of executives, managers, and employees.

Boeing will cease production of commercial 767 freighters in 2027 when its backlog is fulfilled, and the delivery of its 777X will be postponed until 2026.

Boeing announced that it expects to lose nearly $10 a share in the third quarter and will incur charges of about $5 billion in its commercial and defense units. The manufacturer has not had an annual profit since 2018. Ortberg will present the company's financial results to investors for the first time as CEO on Oct. 23.

"Richard Aboulafia, managing director at AeroDynamic Advisory, stated that once the company achieves 737 production on track, all their financial problems will be resolved. However, they are not willing to compromise to make that happen, which has resulted in them firing employees who could help achieve stable production. It seems like they are unintentionally destroying their own success."

The final assembly of an aircraft accounts for approximately 5% of its cost, according to Aboulafia's estimate.

Boeing's shares have fallen 42% this year, marking the steepest decline since 2008. Now, Ortberg must focus on raising funds and stopping the financial bleeding at the company.

Ortberg advised staff to concentrate on core areas and allocate resources accordingly, rather than spreading themselves too thin and risking underperformance and underinvestment.

Boeing is facing a potential downgrade to junk status from S&P Global Ratings due to the halted production of its best-selling 737 Max and other aircraft models, which is costing the company over $1 billion per month. This estimate includes previously announced cost-cutting measures such as temporary furloughs, a hiring freeze, and a halt of most purchase orders for affected aircraft.

According to Bank of America aerospace analyst Ron Epstein, Boeing is facing challenges in quality, labor relations, program execution, and cash burn, which have created a vicious cycle. He believes that Boeing's early financial release on Friday indicates that an equity raise of up to $15 billion may be in the works.

After hiring and training new machinists and other specialists, Boeing and the aerospace supply chain announced job cuts.

Boeing's 737 fuselage maker is considering furloughing workers as part of its cost-cutting contingency plans, a spokesman said, adding that it hasn't made any decisions yet. Boeing is in the process of acquiring that company.

"Aboulafia remarked that Boeing's latest cost cuts are likely a story about how cost savings are helping them endure. He questioned, "When has something not working stopped them from trying it again?""