As the strike by Boeing workers enters its second month, the company and its employees have already faced nearly $5 billion in losses, according to a new analysis by Anderson Economic Group, shared exclusively with CNN.
The strike, which began on September 13, involves 33,000 members of the International Association of Machinists (IAM) and has halted production at Boeing’s Everett, Washington facility. This marks Boeing’s first major labor strike in 16 years. The $5 billion cost underscores the mounting challenges faced by the once-iconic American aircraft manufacturer, which has been hit by a series of crises in recent years, from fatal 737 Max crashes to regulatory scrutiny.
The bulk of the losses — $3.7 billion — have impacted Boeing workers and shareholders. Additionally, Boeing’s suppliers have lost $900 million, non-Boeing Seattle-area workers have suffered $102 million in losses, and the company’s customers, primarily airlines, have faced $285 million in financial impact.
“Suppliers, Seattle-area businesses, and Boeing customers are paying part of the price,” said Patrick Anderson, CEO of Anderson Economic Group. “Our estimates now show significantly larger losses to businesses in the Seattle area, as well as to customers relying on Boeing’s services and parts.”
Boeing’s financial strain has intensified, with the company reportedly burning through cash and considering borrowing or issuing stock to stay afloat during the strike. On Friday, Boeing announced plans to lay off 10% of its workforce, about 17,000 employees, over the next few months. CEO Kelly Ortberg described the company’s position as dire in an email to employees, stating, “It is hard to overstate the challenges we face together.”
Ortberg took over as CEO in August, shortly after Boeing pleaded guilty to defrauding the FAA over a system upgrade failure on its 737 Max fleet, which contributed to two fatal crashes in 2018 and 2019. The company was fined nearly $1 billion as part of a plea deal, which is currently under judicial review.
Negotiations between Boeing and the striking IAM workers broke down last week, despite two days of talks with federal mediators. Boeing’s commercial airplane division CEO Stephanie Pope criticized the union for rejecting what she called “reasonable” proposals, describing their demands as “non-negotiable.”
However, IAM District 751 President John Holden told CNN on Thursday that he remains optimistic about reaching a deal. “There’s a lot on the table, and we believe an agreement can be reached,” Holden said. While confident in the strike fund’s ability to support workers, he acknowledged the wider economic impact. “The longer this goes, the harder it is to restart production and recover the aerospace supply chain,” he added.
