Wednesday is shaping up to be one of The most important day in a volatile year for BoeingWhich is expected to report a huge loss in the third quarter, introduce its new CEO on his first earnings call, and learn whether the machinists will end a strike that has disrupted the company’s aircraft production for more than a month.
The strike is an early test for Kelly Ortberg, a Boeing outsider who became CEO in August.
Ortberg has already done Mass layoffs announced And a plan to raise enough cash to avoid a bankruptcy filing.
They need to convince federal regulators that Boeing is fixing its safety culture and is ready to boost production of the 737 Max — a key step to bring in much-needed cash.
However, Boeing cannot produce any new 737s until it ends a five-week-old strike by 33,000 machinists that has closed assembly plants in the Seattle area.
Ortberg “has a lot to say, but he’s probably focused on getting this conversation done.”
He’s the closest crocodile to the boat,” said Tony Bancroft, portfolio manager at Boeing investor Gabelli Funds.
Boeing hasn’t had a profitable year since 2018 and things are about to get worse before they get better.
Analysts expect Boeing to announce Wednesday that it lost nearly $6 billion in the third quarter, including a $3 billion charge related to airline jets and a $2 billion loss for its defense and space programs.
Investors will be looking for Ortberg to show calm, determination and urgency as he presides over an earnings call for the first time after spending the last decade running Rockwell Collins, a company that makes avionics and flight controls for airline and military aircraft.
However, the biggest news of the day is likely to come on Wednesday evening, when the International Association of Machinists and Aerospace Workers will reveal whether striking workers are set to go back to their jobs.
They will vote on a Boeing proposal at union halls in the Seattle area and elsewhere that includes a 35% pay increase over four years, a $7,000 ratification bonus and maintaining the performance bonuses that Boeing had wanted to eliminate.
Boeing has persevered oppose union demands To restore the traditional pension scheme which was stalled for a decade.
However, older workers will get a slight increase in their monthly pension payments.
On a picket line outside Boeing’s factory in Everett, Washington, some machinists encourage coworkers to vote no on the proposal.
“Pension should have been the top priority. We all said this was our top priority along with salaries,” said Larry Best, head of customer-quality Coordinator with 38 years at Boeing,
“Now is the best chance we have to get our pensions back in prime time, and we all need to stay out there and work hard at it.”
Best also believes pay increases need to be 40% over three years to compensate for the long-term stagnant wages now combined with high inflation.
“You can see we had a very good turnout today. I’m pretty sure they don’t like the contract because that’s why I’m here,” said another picketer, Bartley Stokes Sr., who started working at Boeing in 1978.
“We are here in force, and we are going to show our solidarity and stand with our union brothers and sisters and vote this thing out because they can do better.”
