Despite warnings that production of Boeing's next generation 777 plane could go to another state, machinists in the Northwest voted late Wednesday to reject a contract proposal that would have exchanged concessions for decades of secure jobs.
In response, the Boeing Co. said it would begin a bid process to find a home for its 777X production line.
Members of The International Association of Machinists District 751 rejected the proposal with 67 percent of the votes. Union members who called for a no vote did so in protest of Boeing's push to end a traditional pension plan and increase their health care costs. Workers would have received a $10,000 signing bonus if they approved the deal.
"We preserved something sacred by rejecting the Boeing proposal. We've held on to our pensions and that's big. At a time when financial planners are talking about a 'retirement crisis' in America, we have preserved a tool that will help our members retire with more comfort and dignity," said Tom Wroblewski, District 751 president in a statement.
Boeing had proposed the eight-year contract extension, saying it needs the deal to assemble the new 777X in Washington state. With the threat of those jobs going to another state, lawmakers rushed to approve $8.7 billion in tax breaks last week.
"... Without the terms of this contract extension, we're left with no choice but to open the process competitively and pursue all options for the 777X," Boeing said in a statement.
In a late night press conference, Gov. Jay Inslee said Washington state could have won the production of the plane without competition. The proposal's rejection means that Boeing will look at states, such as Texas, that have Right-To-Work laws, which halt unions.
"This is a tough night for the state of Washington," Inslee said. "We could have had a big win tonight. We could have grabbed the brass ring for this airplane. But I want to say this, what we were unable to finish tonight, means that we are starting a new chapter of competition for this airplane."
Inslee said that Boeing officials assured him that Washington state was still a contender.
Inslee added that the state would still have a strong showing, citing the recent tax incentive package that was quickly passed by the Legislature, a potential transportation package the governor still hopes could be taken up in coming weeks, as well as the "best aerospace workers in the world."
"The fact is this, if you want to build reliably, with the highest quality in the world, on time, the state of Washington is the place to do it," Inslee said.
Throughout Wednesday, the mood was tense at the union hall in Seattle where the votes were tallied.
Dian Lord, a toolmaker at Boeing's facility in Renton who is nearing retirement, said Wednesday morning she believed the company was extorting its workers by pushing a swift contract vote while threatening to place 777X operations elsewhere if machinists don't oblige. Still, Lord said she felt intense pressure to vote for the contract, especially considering that it could impact a variety of other Boeing workers and vendors should the company move elsewhere.
"I'm very conflicted," Lord said.
Political leaders, including many Democrats who are closely aligned with unionized workers, declined in recent days to encourage machinists how to vote but asked them to consider the broader impact on jobs and future generations. IAM leaders issued a similar message, with Wroblewski saying the vote is about 30 years of jobs for the region.
"This is an opportunity we will never see again to secure thousands of good-paying jobs in the State of Washington," Wroblewski wrote in a message to members before the vote.
Ray Conner, CEO of Boeing Commercial Airplanes, said earlier this week that the company was not bluffing in its message that the 777X line could be placed elsewhere. He said the company prefers to stay in the Puget Sound and that a positive vote by the union makes that decision easy.
Along with extending tax breaks to 2040, lawmakers this past weekend also approved millions of dollars for training programs for aerospace workers. Lawmakers have also said that Boeing supports the development of a large transportation package, and the Legislature is still exploring a plan valued at about $10 billion.
Associated Press writers Rachel La Corte in Olympia, Wash., and Manuel Valdes in Seattle contributed to this report.