The Machinists, who rejected a similar contract offer by a two-to-one margin in November, will vote on the revised offer on Friday. And Boeing is making sure their employees know the stakes of the vote: Company officials told local lawmakers earlier this week that failure to ratify the contract will force Boeing to move production of at least some elements of the new 777X airliner to another location.
“If this contract is ratified, it would secure 777X final production and wing build in the Puget Sound [region],” Doug Alder Jr., a Boeing spokesman, said in an e-mail. “This is the last opportunity for the union to vote prior to Boeing making a final decision on the 777X site.”
On Monday, Boeing Commercial Airplanes CEO Ray Conner delivered that message to elected officials gathered in Everett, where the company has a major assembly facility. But if the union rejects the contract, the wing would certainly be constructed elsewhere.
“They made it very, very clear,” Snohomish County Executive John Lovick (D), who attended the meeting on Monday, said in an interview. If the contract passes, Lovick said, “they can guarantee they will build the composite wing, they will build a 1.2 million square foot building.”
The union’s vote in November to reject Boeing’s initial contract offer spurred the company to begin soliciting bids from other states. Nearly two dozen states responded to the company’s request for proposals, several with packages of tax credits worth billions of dollars to the company over several decades.
Some states, like North Carolina and Pennsylvania, have already been dropped from consideration, the Associated Press reported Tuesday. But others, including Alabama, South Carolina, Utah and Missouri — all states where Boeing already has a major presence — remain in the hunt.
Washington state lawmakers passed their own package of tax incentives, valued at $8.7 billion over nearly three decades. It was the largest package of corporate tax incentives ever passed by a state legislature, though the breaks are contingent on Boeing keeping the 777X line in Washington state.
“This is going to be an issue about the long-term welfare of this metropolitan area that depends on the Boeing Company and the businesses it contracts with to grow out this century,” said Ron Sims, a former King County executive. “This is the future of the region.”
Union officials, nervous over the prospect of losing so many jobs, have been pushing to increase turnout for Friday’s vote. The union will take the unusual step of allowing members to vote by absentee ballot, given that so many members are likely to be on vacation during the holiday week.
Boeing’s initial contract offer angered Machinists by changing the union’s wage structure and altering the retirement benefits package. The new version keeps the changes to the retirement plan but restores the wage structure. If the new version is approved, Boeing Machinists would get a $10,000 signing bonus offered in the initial version, an additional $5,000 bonus to be paid in 2020 and better dental coverage, Alder said.
The union’s vote, and the company’s subsequent decision, have major implications for the Seattle area. Bob Drewel, a former Snohomish County executive, said Monday that the 777X line would be worth $20 billion and account for 20,000 jobs in the region. Those jobs aren’t just Boeing jobs: Lovick said Snohomish County has 170 aerospace suppliers, all of which depend on Boeing.
“I can’t tell you the number of billions of dollars that Boeing has invested in our county,” Lovick said. “A lot will hinge on what happens with this vote.”
Friday’s vote puts many Washington state Democrats in the difficult position of choosing between the state’s biggest employer and their labor allies. Gov. Jay Inslee (D) came under fire from labor backers in December for urging the Machinists union to allow a vote on a version of the contract; in protest, several union bigwigs rejected invitations to Inslee’s first Christmas party at the governor’s mansion.
“It is a high-wire act, there’s no question,” said Sims, who dealt with the Boeing-labor relationship when he served as executive. But with so many billions on the table, Sims said, walking that wire is all the more essential: “Nobody passes up that kind of economic growth. You just don’t do that.”
This time, Inslee has made clear he isn’t telling anyone how to vote. And members of the state’s Congressional delegation have been notably silent on the new contract.
Lovick, the Snohomish County executive, hastened to add that he is on the Machinists’s side.
“I absolutely support the Machinists. These Machinists are our neighbors, many of them are our friends, and they build the best airplanes in the world,” he said. “But we also want these jobs to stay right here in the state of Washington.”