Boeing faces strike in St. Louis area as defense machinists reject contract

Boeing (NYSE:BA) is confronting a fresh labor disruption as about 3,200 unionized workers at its defense facilities in the St. Louis region walked off the job after rejecting the company’s latest contract offer. The strike began at midnight following a Sunday vote by members of the International Association of Machinists and Aerospace Workers.

The work stoppage deals a blow to Boeing’s (NYSE:BA) efforts to stabilize its business, particularly in its defense segment, which has recently shown signs of recovery. The dispute centers on unresolved issues over scheduling and employee benefits. Workers had remained on the job without a contract for a week while negotiations continued.

Although smaller in scale than last year’s high-profile strike by more than 33,000 workers in Boeing’s (BA) commercial operations in the Pacific Northwest, which halted 737 Max production and ended with a 38% pay raise, this latest walkout could still affect critical defense programs.

The affected facilities in Missouri and Illinois produce key military aircraft including the F-15 and F/A-18, as well as components tied to the broader munitions supply chain. Boeing (BA) recently reported stable results for its defense, space, and security unit in the second quarter amid heightened demand from the Pentagon and allied governments for advanced weaponry.

After grappling with delays and cost overruns in previous years, including setbacks in its Starliner spacecraft program that left astronauts stranded, the company has seen recent momentum. A new satellite contract from the Pentagon and a major award to help develop the Air Force’s next-generation fighter jet have buoyed its outlook.

“Members have spoken loud and clear” for a “contract that reflects their skill, dedication, and the critical role they play in our nation’s defense,” Tom Boelling, a spokesperson for the union, said in a statement.