United Continental Holdings (UAL - option chain) shares are rising today after Continental Airlines announced its fleet service employees ratified their collective bargaining agreement with the company. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on UAL.

UAL opened this morning at $23.60. So far today the stock has hit a low of $23.50 and a high of $23.99. As of 12:15, UAL is trading at $23.86 up 0.40 (1.7%). The chart for UAL looks bullish and S&P gives UAL a positive 4 STARS (out of 5) buy ranking.

Continue reading United Continental Lifted by Union Agreement

United Continental Lifted by Union Agreement originally appeared on BloggingStocks on Thu, 30 Dec 2010 13:00:00 EST. Please see our terms for use of feeds.

Continue reading Southwest Airlines (LUV) reaches tentative contract with union

Southwest Airlines (LUV) reaches tentative contract with union originally appeared on BloggingStocks on Mon, 02 Mar 2009 11:00:00 EST. Please see our terms for use of feeds.

There are 200 workers sitting-in at a Chicago factory that they claim has stiffed them. And President-elect Obama supports their goals. This raises many questions: Is the sit-in illegal? If so, is Obama supporting an illegal action? More importantly, is Obama inadvertently encouraging workers around the country to pursue similar tactics?

At issue here is Republic Windows and Doors, a Chicago manufacturer that laid off its 200 workers last week and has failed to assure them that it will pay them the severance and vacation money they earned. The workers have responded by sitting-in on the factory floor. Obama said, "The workers who are asking for the benefits and payments that they have earned, I think they're absolutely right and understand that what's happening to them is reflective of what's happening across this economy," according to AP.

I have no legal training, however, it looks to me like a sit-in is a form of trespassing -- assuming that the workers are no longer employees of the company. (A VP of the worker's union said "We expected to go to jail.") My reading of Obama's comment suggests that he supports the workers' goals -- which is to get the money to which they're legally entitled -- while taking no position on the legality of their sit-in. The question is whether other aggrieved workers will miss this subtlety and view Obama's statement as an implicit endorsement of the workers' tactics.

Continue reading Will President-elect Obama start a wave of labor unrest?

Will President-elect Obama start a wave of labor unrest? originally appeared on BloggingStocks on Mon, 08 Dec 2008 08:35:00 EST. Please see our terms for use of feeds.

Boeing Co. (NYSE: BA) and its engineering union have come to terms on a contract. This is good news for Boeing and its workers. Boeing can continue designing aircraft and its engineers can enjoy a raise. Considering the economic climate in which this contract was negotiated, it is a testimony to Boeing's financial prospects that it was able to increase their pay. With a $276 billion backlog, Boeing could be among the healthiest companies around.

What are the terms of the deal? Boeing employs 20,500 Society of Professional Engineering Employees in Aerospace (SPEEA) workers who are well paid already: 13,900 Boeing engineers average $88,000 annually and 6,600 technical workers make $67,000. The new contract offers 5% annual raises, higher pension payments and overtime rates, and gives workers more input concerning outsourcing decisions. But SPEEA members will pay $200 a year more for improved health care.

While this contract settlement is good news, it is less critical to Boeing's operations than the 52-day strike it settled last month with Boeing's machinists that cost $10 million a day. That's because the machinists were building aircraft before they went on strike, whereas the engineers are largely designing future ones. Nevertheless, both SPEEA and the machinists agreed to four year contracts -- a year longer than usual. This means that Boeing can now get back to work satisfying the prodigious demand for its products.

Continue reading Boeing averts engineering strike

Boeing averts engineering strike originally appeared on BloggingStocks on Tue, 02 Dec 2008 08:48:00 EST. Please see our terms for use of feeds.

The Boeing Company (NYSE: BA) just reached a tentative agreement with its 20,500-member engineering union, the Society of Professional Engineers in Aerospace (SPEEA). This puts to rest the labor woes that cast a shadow over the company beginning in September. On November 1, Boeing settled a 54 day strike with its 27,000 member machinists union. And today, Boeing looks like it will avert a strike with SPEEA if the parties sign a contract by December 1.

In the negotiations, SPEEA wanted a specific limit on subcontracting engineering work and Boeing wanted to make sure that contract improvements would be affordable if there was a slowdown and that it would have outsourcing flexibility to stay competitive. Boeing initially asked engineers to pay more of their health care costs and for new engineers to accept a 401(k)-style retirement plan rather than the current defined-benefit pension program.

Boeing engineers are well-paid. 13,000 of them in Washington state, Oregon, Utah and California make an average of $88,000 a year, and its 7,000 technical workers average $67,000. But SPEEA wanted more -- 10% annual raises through 2011, more vacation days, higher overtime rates, a restoration of early retiree medical benefits and changes to the health-care and pension plans.

Continue reading Boeing about to put its labor woes behind it -- for now

Boeing about to put its labor woes behind it -- for now originally appeared on BloggingStocks on Fri, 14 Nov 2008 17:40:00 EST. Please see our terms for use of feeds.

After a 52-day strike, Boeing Co. (NYSE: BA) has reached a tentative deal with its 27,000 member machinists union. Tentative details suggest that workers will get a 15% wage increase over three years, an $8,000 bonus over four years, and a freeze of medical costs at 2005 levels. Furthermore, the new contract limits the amount of work that can be outsourced and will last a year longer than the previous pact. But even though the contract has not been ratified, this is good news for Boeing and its workers.

Limiting outsourcing could be good for Boeing and the workers depending on how it's accomplished. One of the reasons for the delay in delivering its very popular 787 aircraft was that Boeing outsourced the majority of the design and manufacture of the components and later discovered that it was not doing enough to manage those subcontractors. As a result, Boeing suffered unpleasant surprises in its delivery schedule.

If Boeing and its machinists agreed to give the union a chance to bid on work under consideration to be outsourced, then both parties might be better off. That's because if the union offered a competitive price and excellent quality, Boeing would likely find it easier to manage its union workers than those of a subcontractor located half way around the world.

Continue reading Boeing reaches deal with machinists. Is its engineering union next?

Boeing reaches deal with machinists. Is its engineering union next? originally appeared on BloggingStocks on Tue, 28 Oct 2008 10:10:00 EST. Please see our terms for use of feeds.

Boeing (NYSE: BA) settled its seven-week old strike with machinists agreeing to a four-year contract. In the meantime, the company has lost precious time building planes including its Dreamliner, which is already over a year late for its first delivery. World airlines that have ordered the new aircraft are already in a snit.

According to The Wall Street Journal, "During the standoff, both sides dug in over issues such as job security and who had ultimate authority to run the factories, even as the national economy was undergoing a major upheaval." In other words, Boeing undercut the value of its shares when it could have settled on a similar deal a month ago. During most negotiations management knows how far it is willing to go, but holds out hoping labor will back down. In this case, that did not happen.

While Boeing management has been fiddling around, the company's stock has dropped to $42, near a 52-week low, and down from a period high of almost $99. Boeing faces angry customers, many of whom are asking for compensation for planes that will be late.

Boeing let labor shut it down while the economy went to hell in a hand-basket and its rival Airbus took whatever advantage of that it could. Boeing has a huge back-order of planes. Giving into the union would not have cost it much in profits. It has too many sales to fulfill.

Douglas A. McIntyre is an editor at 247wallst.com.

Boeing settles strike too late originally appeared on BloggingStocks on Tue, 28 Oct 2008 07:30:00 EST. Please see our terms for use of feeds.

The fight between Boeing (NYSE: BA) and its machinists may go on a long, long time. While that may be bad for the union, it is much worse for Boeing. Its customers expect prompt delivery of fuel-efficient planes, especially the new Dreamliner. Boeing's management gambled on getting the union to knuckle under and lost.

According to The Wall Street Journal, "As far as our members are concerned, we are in this one for the long haul," said Mark Blondin, aerospace coordinator and lead negotiator for the 26,800 machinists. The statement does not sound conciliatory.

Shareholders are getting the worst of it. Boeing trades at about $57, down from a 52-week high over over $107. With delivery delays, revenue is certain to drop.

Boeing's case with the unions is weak. The company claims it cannot give machinists a good three-year deal because earnings may not be strong that far out. With the company's tremendous backlog, it would be hard to imagine that being true.

Boeing's management will not be remembered well by history. They thought they had leverage in a situation where they had almost none.

Douglas A. McIntyre is an editor at 24/7 Wall St.

Boeing now regretting strike originally appeared on BloggingStocks on Thu, 25 Sep 2008 09:54:00 EST. Please see our terms for use of feeds.

Boeing (NYSE: BA) has been gambling that its machinist union would back down from further wage and benefit demands. Instead, according to The Wall Street Journal, the aircraft company's largest labor union "voted to strike Wednesday night, but the union agreed to postpone a walkout for 48 hours after federal mediators urged both sides to return to the bargaining table."

If the employees walk, the delays in delivering the company's new Dreamliner flagship product could be pushed back again. The launch has already been postponed three times. Airline customers are mad enough that some are asking for compensation because Boeing has not hit its schedules.

Boeing's argument is that it cannot be saddled with high future labor costs. If its business slows down, its margins could be hurt. But the union members can read Boeing press releases. The company has a substantial back order of planes which should feed earnings for the next decade. Boeing is also saying that growth in the Chinese market could help support its business for the next twenty years.

Boeing can afford to pay the union members a bit more. It can't afford a strike.

Douglas A. McIntyre is an editor at 24/7 Wall St.

Boeing union votes to strike -- management's mistake originally appeared on BloggingStocks on Thu, 04 Sep 2008 08:30:00 EST. Please see our terms for use of feeds.

Boeing (NYSE: BA) can't take a strike. It has too much depending on the launch of its new Dreamliner. That launch has been delayed three times and carriers are already asking for compensation for their costs due to the fuel-efficient plane being behind schedule.

Boeing has been going at it with its large machinists union and it looks like the two sides have made no progress. According to Reuters, the company's "largest labor union said on Friday it advised its members to reject the company's final contract proposal and go forward with a strike this week that could cost the plane maker $3 billion a month."

Boeing's logic is that it does not want to face high costs in the future when its revenue may be lower. But that logic is deeply flawed, and the union knows it. Boeing has a heavy delivery schedule that goes out at least five years for the Dreamliner and other planes. The company also says that deliveries over the next two decades will be strong due largely to demand in Asia.

Boeing management is making a tactical error and shareholders will pay for it. The stock is at $65, but the strike will send it to $50.

Douglas A. McIntyre is an editor at 247wallst.com

A strike at Boeing, a mistake by management originally appeared on BloggingStocks on Tue, 02 Sep 2008 09:15:00 EST. Please see our terms for use of feeds.

Boeing (NYSE: BA) has been furiously negotiating with its machinist's union to avoid a strike vote by them that could come as early as September 3. Labor's greatest concerns is that Boeing has made a lot of money over the past several years, and workers have seen very little benefit from that.

According to Bloomberg, "The union says workers haven't had raises, except for cost-of-living increases, since 2004 and deserve to share in Boeing's $10.7 billion in profit since then." Boeing is taking the standard large company position: It cannot afford to sharply increase benefits without putting itself in jeopardy if its business slows.

Boeing might want to sharpen its pencil. A strike could cost it another delay for the launch of its new Dreamliner. It has already pushed back that date three times. Airline customers are so upset that some of them have asked for compensation. More delays could up the request for "damages" from carriers who still need the more fuel-efficient airplane.

The winner in a Boeing strike will probably be Airbus. It has had delays of some of its own products, including its huge A380 jumbo jet. But, most of those issues seem to be behind the European company. If Boeing can't deliver planes, Airbus can pick up market share.

Douglas A. McIntyre is an editor at 247wallst.com.

A strike at Boeing? An advantage for Airbus originally appeared on BloggingStocks on Sat, 23 Aug 2008 11:40:00 EST. Please see our terms for use of feeds.

Airlines may not get the Boeing (NYSE: BA) Dreamliner on its new revised schedule after all. The plane has been delayed three times because of manufacturing and supplier glitches. If Boeing has problems with one of its unions, it might have to push back the launch date again. Some airlines are already asking Boeing for compensation for the late deliveries.

According to The Wall Street Journal, "With its aircraft order books so full that some customers must wait as long as five years for deliveries, Boeing can ill afford a strike -- especially one that could further delay the rollout of its new 787 Dreamliner jet."

At the center of the negotiations are pay and pensions, making them little different from most such talks. But the solution for both sides could involve an incentive.

Boeing does not want to be faced with a strike that could hurt its revenue. The unions want a bigger piece of Boeing's sales pie. Boeing should return to the bargaining table with a simple proposal. If its new jets are delivered on time, wages will go up at a rate close to the union's requests. If not, the increases will be lower.

Boeing could set up a partnership with its labor force driven by the common goal of product launches. That is better than a strike that does neither the union nor Boeing any good.

Douglas A. McIntyre is an editor at 247wallst.com.

A strike may be Boeing's (BA) next problem originally appeared on BloggingStocks on Thu, 21 Aug 2008 08:31:00 EST. Please see our terms for use of feeds.

The Wall Street Journal reports that Wal-Mart Stores (NYSE: WMT) is warning its store managers against an Obama victory in November. Why? because Wal-Mart executives worry that Obama will boost the power of unions and that unionized Wal-Mart stores will lead to higher worker pay -- and higher prices for Wal-Mart customers.

I can understand why Wal-Mart executives would want to keep President Bush's policies in place for another four years. After all, those low taxes on the top 1% help enrich Wal-Mart brass. I am not suggesting that all Wal-Mart customers are Republicans, not at all, but I do believe that most people who shop at Wal-Mart cannot afford to buy their shoes at Neiman Marcus. And these middle- and lower-income Wal-Mart shoppers are the natural beneficiaries of Democratic policies such as Obama's plan for a middle-class tax cut.

Wal-Mart is clearly trying to be on both sides of this election. The Journal reports that it's reduced its share of contributions to Republican candidates from 98% in 1996 to 52% in 2008 -- giving 48% of its $2.2 million in political contributions to Democrats this year. It also has directors who have been big Clinton supporters, including Hillary Clinton herself who served on its board from 1986 to 1992 and Aida Alvarez, who worked in Bill Clinton's cabinet from 1997 to 2001 and has been a Wal-Mart director since 2006.

Continue reading Wal-Mart's Republican executives at war with its Democratic customers

Wal-Mart's Republican executives at war with its Democratic customers originally appeared on BloggingStocks on Fri, 01 Aug 2008 09:09:00 EST. Please see our terms for use of feeds.

Yes it's true -- just like you and me, the writers want more money, and since they did not get it they are walking out. Actually having some keen familiarity with Hollywood, I would find it hard to believe that after not striking since 1988, writers could actually come to any agreement with producers without one now.

First of all, the world is changing rapidly and whatever agreements they settled on in the past is most assuredly not attuned to the media landscape of today. The writers feel they negotiated a borderline contract before, and do not want to give up any revenue opportunities now.

Producers have made more money from the internet and DVD sales than they have in the past, but they have seen weaker box office attendance and are getting burned badly by DVD pirates burning cheap discs for sale at great discount to the legitimate copies.

The last time there was a strike, we are told the industry lost $500 million. I have no way of verifying the legitimacy of that figure because in Hollywood (as those in the know can attest), the most creative talent is found in the accounting department, not on the screen.

Continue reading Writers strike over more money, searching for equal pain

Writers strike over more money, searching for equal pain originally appeared on BloggingStocks on Mon, 05 Nov 2007 15:30:00 EST. Please see our terms for use of feeds.

Writers strike, poop joke shortage feared originally appeared on BloggingStocks on Mon, 05 Nov 2007 12:35:00 EST. Please see our terms for use of feeds.

Chrysler contract approved by UAW; Ford negotiations loom originally appeared on BloggingStocks on Mon, 29 Oct 2007 11:25:00 EST. Please see our terms for use of feeds.

Now that the UAW contract with Chrysler is all but ratified, the big union gets to sit down with Ford (NYSE: F). In some ways, bargaining with America's second-largest car company may be the toughest negotiation of all. Ford is in worse shape than its peers, and its revenue problems get worse as each month passes.

Ford may be able to afford putting $30 billion into a health-care fund that the union would manage. That would improve the company's earnings in future quarters. But it would also deplete Ford's balance sheet and give it less cash to fund a turnaround of its U.S. operations. Selling off Jaguar or Rover could bring in more capital, but the process to dump the two brands is slow and the current credit environment will not help Ford get a good price.

Ford had hoped that new products would improve its prospects, but its car sales have dropped about 20% in its home market each of the last two months. It is not clear that Ford can ever make a profit if its U.S. sales do not recover from current levels. It needs sharp cuts in its labor costs in addition to a better sales picture.

The UAW can do a great deal of damage to Ford by insisting on modest job cuts. Ford can ill afford a strike now that the other two U.S. car makers have deals and Japanese rivals pick up market share most months. But the union's rank-and-file came close to rejecting the Chrysler contract because it guaranteed too little in terms of jobs and pay in the years ahead.

UAW workers are likely to take the position that it is not their job to keep Ford in business. And that attitude is the most likely one to put Ford's future in harm's way.

Douglas A. McIntyre is an editor at 247wallst.com.

Ford vulnerable heading into UAW negotiations originally appeared on BloggingStocks on Fri, 26 Oct 2007 06:46:00 EST. Please see our terms for use of feeds.

Protectionism politics originally appeared on BloggingStocks on Wed, 10 Oct 2007 15:15:00 EST. Please see our terms for use of feeds.

Chrysler up next for UAW contract talks originally appeared on BloggingStocks on Tue, 09 Oct 2007 11:49:00 EST. Please see our terms for use of feeds.

Ford (F) and Chrysler may not follow UAW-GM deal template after all originally appeared on BloggingStocks on Thu, 04 Oct 2007 13:57:00 EST. Please see our terms for use of feeds.