Boeing shares fall as machinists strike begins

(CercleFinance.com) - Boeing shares suffered the biggest fall of the Dow Jones index on Wall Street on Friday, as the American machinists' union IAM launched a major strike overnight.


After a 94.6% vote rejecting the new contract proposed by the aircraft manufacturer, and a 96% vote approving the principle of a walkout, the 30,000 members of the IAM 751 union decided to stop work.

For analysts, this industrial action makes Boeing's ability to make up for the delays accumulated in recent months due to the emergence of quality and safety problems within its manufacturing chain uncertain.

'The ball is now in Boeing's court, as it will have to find an answer, resolve the situation and avoid further disruptions', say Bank of America teams.

The aeronautics group's management team has declared its readiness to return to the negotiating table to reach an agreement, while emphasizing the advantages linked - in its view - to the new collective agreement.

In a research note, Jefferies analysts recall that a similar strike, voted in 2008, lasted 58 days, resulting in delayed deliveries of over 100 aircraft.

In financial terms, the research firm recalls, the company had to absorb a $1.2 billion impact on net income and a $2.55 billion impact on cash flow.

At around 10:50 a.m. (New York time), Boeing shares were down 0.7%, while the Dow was up 0.7% at the same time.

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