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Key Takeaways
- Boeing shares surged in premarket trading Monday as markets reacted to a tentative agreement between the plane maker and two key labor union partners.
- The International Association of Machinists and Aerospace Workers represents over 30,000 Boeing workers across Washington, Oregon, and California.
- The sides agreed to a deal including raises, revamped retirement benefits, and parental leave, potentially averting a strike.
Boeing (BA) shares jumped in premarket trading Monday, a day after the plane maker announced a tentative agreement with two of its largest labor union partners.
The deal would see roughly 33,000 Boeing employees across Washington, Oregon, and California get raises of 25% over the next four years, along with other benefits like a revamped retirement savings program and parental leave, the company announced Sunday.
4-Year Deal To Be Voted on Thursday
The International Association of Machinists and Aerospace Workers members covered by the deal are set to vote on whether to ratify the four-year contract Thursday, when the current deal is set to expire. A strike could have started once the previous deal expired, halting production at a number of facilities.
In addition to the raises, the deal also includes $3,000 lump-sum payments for every covered employee, improved health-insurance benefits, and lower overtime demands. The company also agreed to commit to building Boeing’s next-generation plane in its Puget Sound facilities.
“The contract offer provides the largest-ever general wage increase, lower medical cost share to make healthcare more affordable, greater company contributions toward your retirement, and improvements for a better work-life balance,” Boeing Commercial Airplanes Chief Executive Officer (CEO) Stephanie Pope said in a message to employees.
Boeing shares were 4.5% higher at $164.69 two hours before the opening bell Monday, but are still down nearly 37% since the start of 2024 amid a series of safety issues and executive changes.