Why the Mighty Boeing Bent to Union Demands

And on the 38th day, the union officials said, "Let there be flight!" One of the longest and largest white-collar strikes in American history came to an end Friday when members of the Society of Professional Engineering Employees in Aerospace reached a tentative agreement with aerospace giant Boeing over wages and benefits. The settlement, described by analysts as "generous" to the union, highlights both increasing competition for Boeing from the European aircraft consortium, Airbus, and a general corporate love affair with stock prices that appears to have pushed the issue of corporate costs into the background.

After all, in the early weeks of the 17,000-member strike, which began Feb. 9, Boeing seemed unwilling to budge. Management, in fact, was outwardly unfazed by the 50 percent drop-off in production that angered customers waiting for sorely needed new airplanes. But in this age of stock option-rich execs, it took little more than a nudge from Wall Street to force a deal. The crunch came earlier this week when analysts lowered their earnings forecasts for the firm, sending the stock to a 52-week low. A few years ago such a strike might not have inspired an adjusted forecast, but since Airbus has cut into Boeing's share of global manufacturing by about 25 percent in recent years — wooing away such loyal Boeing customers as El Al and British Airways — Wall Street analysts took the customer complaints seriously.