Machinists at Boeing Walk Off the Job

About 950 Boeing Co. machinists who test and launch Delta rockets in Southern California and Florida walked off their jobs Wednesday after contract talks ended in an impasse.

The job action by local members of the International Assn. of Machinists and Aerospace Workers comes a month after 18,300 machinists in the Seattle area returned to work after a monthlong strike that forced the delay of 30 commercial aircraft deliveries and reduced Boeing’s revenue by $1.5 billion.

Analysts said the labor dispute wasn’t expected to harm Boeing financially, because the commercial market for rockets to launch satellites into orbit had slowed to a trickle and there was a limited demand for military rocket launches.

Last week, Boeing halted pre-launch processing for three rockets after the union voted to strike.

“I don’t think it will have a noticeable impact,” said Paul H. Nisbet, an aerospace analyst for JSA Research Inc. “It’s a small part of Boeing, and it hasn’t been profitable. Also, satellite launches are so infrequent that a slippage of a couple of months won’t mean much.”

The union’s rank and file voted to strike after rejecting Boeing’s final offer.

The contract covers 365 machinists who test Delta rocket components in Huntington Beach, 382 workers who prepare the rocket for launches in Cape Canaveral, Fla., and Vandenberg Air Force Base and 103 machinists who work on military intelligence equipment in Torrance. An additional 104 machinists work on components for Boeing’s C-17 military cargo planes in Long Beach and Huntington Beach.

Boeing offered the workers an extra $3,000 lump-sum payment in the first year, a 2% wage increase in the second and a 2.5% hike in the third. But the proposed three-year contract also increased workers’ out-of-pocket medical expenses and called for the elimination of retiree medical benefits for new hires.

Gary Quick, chairman of the union’s negotiating committee, said the wage increases were “less than we expected and less than deserved, but they would have been acceptable.”

However, the union members could not accept raises in healthcare costs and the elimination of the retiree medical benefits, he said.

Boeing spokesman Dan Beck said Wednesday that the company offered what it felt was an “outstanding and generous offer,” but that it remained willing to discuss any new proposal the union might have.

Boeing shares slipped 35 cents to $64.70.