Last fall, Boeing's 27,000 machinists went on strike for 52 days. Not surprisingly, this put a crimp in Boeing's ability to meet its production schedule. Until today, it was hard to know just how much damage that strike did. Now we know that Boeing's 2008 aircraft deliveries dropped 15% thanks to the strike. But big questions remain for investors.

The numbers are not pretty. Boeing delivered 375 commercial planes in 2008, 15% fewer than the 441 it delivered in 2007. Prior to the strike, in early 2008, expectations for the year ranged from 475 to 480. But Boeing fell far short. Boeing finished 2008 with 662 commercial airplane orders, bringing its total backlog of unfilled orders to over 3,700. But the 2008 figure was less than half 2007's record order amount.

Meanwhile, Boeing's 787 Dreamliner -- which accounts for 900 aircraft in that backlog -- is about two years behind schedule. The 787's delays are taking engineers away from other projects, such as the one to update its 747 jumbo jet, which has now been delayed nine months. Despite all this bad news, we still don't know how much these delays will cost Boeing in lost revenues and profits. And it remains to be seen whether the fourth 787 production delay will be its last.

Continue reading Strike leads to 15% drop in Boeing's 2008 deliveries

Strike leads to 15% drop in Boeing's 2008 deliveries originally appeared on BloggingStocks on Thu, 08 Jan 2009 15:45:00 EST. Please see our terms for use of feeds.

Although Boeing Inc. (NYSE: BA) won a recent victory in its battle to delay the competition for a $35 billion Air Force airborne tanker, it faces a lengthy strike with its machinists -- one that could last as long as two months. If estimates by BusinessWeek prove accurate, the strike could take between "30 and 65 days" to be resolved. That could cost Boeing as much as "$2.3 billion in revenues this quarter," according to Business Week.

The strike could be costly to workers as well. And a 65 day strike would cost its 27,000 International Association of Machinists (IAM) workers as much as $241 million in lost pay. (This assumes that IAM workers get paid nothing the first two weeks and then earn $150 a week for the remaining 7.2 weeks of a 65-day strike compared to the $56,000 annual pay they would have received had they continued working).

It looks like the IAM's primary bone of contention is Boeing's desire to maintain the flexibility to outsource work. But, as I posted, IAM has six specific complaints. And it does not like what it saw as Boeing's efforts to go over the heads of IAM leadership by communicating directly with workers. But ultimately, it appears that for workers it is about whether or not they will have a job in the future.

Continue reading Will Boeing strike last two months?

Will Boeing strike last two months? originally appeared on BloggingStocks on Fri, 12 Sep 2008 12:00:00 EST. Please see our terms for use of feeds.