<\/p>\n
Boeing (BA) started September with a labor problem that could have slowed its recovery.<\/p>\n
Its engineers, who approve the jets Boeing needs to certify and deliver, almost went on strike.<\/p>\n
However, on Friday, Boeing and its engineering union reached a tentative four-year contract, and investors moved quickly.<\/p>\n
Boeing averts a strike that threatened its jet certification timeline<\/p>\n
Boeing reached the tentative deal on Friday, September 11, with the Society of Professional Engineering Employees in Aerospace (SPEEA).<\/p>\n
The SPEEA covers about 17,000 engineers and technical staff, CNBC reported.<\/p>\n
The current contract expires October 6. A rejection could have triggered a strike days later which matters because SPEEA engineers handle the safety analysis and paperwork behind two delayed programs, the 737 MAX 10 and the 777-9 widebody. <\/p>\n
A strike would have affected those programs.<\/p>\n
BA shares rose 2.76% to close at $210.45 on the same Friday.<\/p>\n
Boeing’s engineers hold the certification keys to the 737 MAX 10 and 777-9 programs<\/p>\n
sanfel \/ Getty Images<\/p>\n
Why Boeing depends on SPEEA engineers to keep building jets<\/p>\n
Boeing earns the biggest share of its revenue selling commercial jets to airlines, with two other arms in defense and aftermarket services.<\/p>\n
The company needs engineers who design, test, and certify the aircraft.<\/p>\n
More Aerospace Coverage:<\/p>\n
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SPEEA represents Boeing’s core Northwest professional and technical units, and it had not negotiated a new contract since 2012, according to Reuters. <\/p>\n
Members approved extensions in 2016 and 2020 instead.<\/p>\n
SPEEA’s negotiating team called the agreement “a real step forward” for pay and for its relationship with Boeing leadership.<\/p>\n
What the new SPEEA contract pays and when the raises land<\/p>\n
The revised offer beat the first proposal on guaranteed wages.<\/p>\n
Boeing’s earlier offer carried 3% general raises, which many engineers said would not keep up with rising prices. <\/p>\n
Seattle-area prices rose 4.5% compared to last year, Reuters reported, citing the U.S. Bureau of Labor Statistics.<\/p>\n
The new pay terms<\/p>\n
A 10% guaranteed raise effective October 16, 2026<\/p>\n
A 4% raise in the March 2027 review<\/p>\n
6% wage pools in 2028, 2029, and 2030, each with a guaranteed 4% raise<\/p>\n
Revised work-from-home rules and tighter overtime limits<\/p>\n
Why higher labor costs still pressure Boeing’s commercial margins<\/p>\n
The raises increase Boeing’s fixed expenses while its commercial airplane margins are already thin and free cash flow is still recovering.<\/p>\n
Boeing guided free cash flow to a range of $1 billion to $3 billion for 2026. Higher wages make those cash targets harder to hit if there is a delay in deliveries.<\/p>\n
The company made a decision to pay more now to keep lines running and certifications on schedule.<\/p>\n
How Boeing stock compares with RTX and GE Aerospace in 2026<\/p>\n
BA is down about 7.6% year to date, even after Friday’s jump. <\/p>\n
RTX and GE Aerospace both posted double-digit gains in 2026, while the iShares U.S. Aerospace & Defense ETF (ITA) sat in between, according to Yahoo Finance. <\/p>\n
Related: SpaceX just targeted a key AI supplier: The stock tanked<\/p>\n
The reason is their business models. RTX relies on diversified defense revenue, and GE Aerospace on recurring engine servicing. <\/p>\n
Boeing depends on building and certifying jets, which ties its results to production progress.<\/p>\n
What still has to happen before Boeing’s comeback holds<\/p>\n
The deal is tentative. SPEEA members still have to vote to approve it over the coming days.<\/p>\n
If they approve, Boeing’s focus shifts back to execution. The company must build jets faster and finish certifications. <\/p>\n
Boeing is already delivering more jets than at any point since 2018.<\/p>\n
What BA investors should watch next<\/p>\n
The ratification vote result<\/p>\n
Progress on 777-9 and 737 MAX 10 certification<\/p>\n
Whether rising labor costs pressure commercial margins<\/p>\n
The defense drag, after a $280 million Air Force One charge hit second-quarter results<\/p>\n
For now, Boeing removed a near-term threat. The harder task is to turn that relief into steady cash flow.<\/p>\n
Related: Two defense stocks just got a multiyear vote of confidence<\/p>\n
#Boeing #races #defuse #threat #ground #comeback<\/p>\n","protected":false},"excerpt":{"rendered":"
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