Boeing's Crisis: Labor Strikes, Layoffs, and Looming Downgrades

Julie Su, U.S. Acting Labor Secretary, intervened in Seattle to mediate a machinists strike affecting Boeing. Amidst a turbulent year, Boeing announced plans to cut 17,000 jobs due to strikes. The aerospace giant faces financial strain, delays in 777X deliveries, and potential downgrades, impacting major airline clients.

Acting U.S. Labor Secretary Julie Su traveled to Seattle on Monday to mediate a strike by Boeing machinists that threatens significant layoffs and has alarmed a major airline. With the Labor Department's confirmation, this marks Su's first in-person mediation with affected parties.

The strike by around 33,000 workers began on September 13, with demands for a 40% wage increase and pension restorations. Boeing, grappling with the strike, announced job cuts of 17,000 employees, job reduction plans, and financial strains as it burns cash for a third quarter.

Financial market reactions, along with industry concerns, underscore the crisis, with the company facing imminent credit downgrades. While Boeing managed to maintain $10 billion gross cash, it is expected to raise up to $15 billion by year-end, amidst investor apprehensions about financial risks.

(With inputs from agencies.)