A Labor Strike Against Economic Reality
Townhall.com ^ | May 15, 2011 | Steve Chapman
In 1977, Boeing was the target of a strike by the International Association of Machinists and Aerospace Workers, which represents its workers in Puget Sound, Wash. and Portland, Ore. The aircraft manufacturer had another strike in 1989. In 1995, workers went out for 69 days. In 2005, they struck again. In 2008 ... well, you see the pattern.
Strikes are an expensive luxury. The last one, which went on for nearly two months, was estimated to cost Boeing more than $2 billion. "Based on previous strike experience," reported The Seattle Times, "Boeing will not recoup that money for many years."
At some point, a light bulb went on in the heads of those running the company: If we can't avoid union walkouts, we can't make aircraft deliveries. If we can't make aircraft deliveries, we don't get paid, we alienate customers and we endanger our livelihood.
After the 2008 walkout, Virgin Atlantic founder Richard Branson voiced exasperation. "If union leaders and management can't get their act together to avoid strikes," he said, "we're not going to come back here again. We're already thinking, 'Would we ever risk putting another order with Boeing?' It's that serious."
Something had to be done. Boeing tried to address the problem with the machinists, asking for a long-term no-strike agreement, but the union showed no interest, and the idea died.
End of story? Not quite. In 2009, the company had to decide where to open a second production line for its 787 Dreamliner. It could have put it where labor troubles were practically guaranteed. Instead, it built a plant in South Carolina, which is scheduled to go on line this summer with 1,000 non-union workers.
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