Boeing races to defuse a threat that could ground its comeback

Boeing (BA) started September with a labor problem that could have slowed its recovery.

Its engineers, who approve the jets Boeing needs to certify and deliver, almost went on strike.

However, on Friday, Boeing and its engineering union reached a tentative four-year contract, and investors moved quickly.

Boeing averts a strike that threatened its jet certification timeline

Boeing reached the tentative deal on Friday, September 11, with the Society of Professional Engineering Employees in Aerospace (SPEEA).

The SPEEA covers about 17,000 engineers and technical staff, CNBC reported.

The current contract expires October 6. A rejection could have triggered a strike days later which matters because SPEEA engineers handle the safety analysis and paperwork behind two delayed programs, the 737 MAX 10 and the 777-9 widebody. 

A strike would have affected those programs.

BA shares rose 2.76% to close at $210.45 on the same Friday.

Why Boeing depends on SPEEA engineers to keep building jets

Boeing earns the biggest share of its revenue selling commercial jets to airlines, with two other arms in defense and aftermarket services.

The company needs engineers who design, test, and certify the aircraft.

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SPEEA represents Boeing’s core Northwest professional and technical units, and it had not negotiated a new contract since 2012, according to Reuters. 

Members approved extensions in 2016 and 2020 instead.

SPEEA’s negotiating team called the agreement “a real step forward” for pay and for its relationship with Boeing leadership.

What the new SPEEA contract pays and when the raises land

The revised offer beat the first proposal on guaranteed wages.

Boeing’s earlier offer carried 3% general raises, which many engineers said would not keep up with rising prices. 

Seattle-area prices rose 4.5% compared to last year, Reuters reported, citing the U.S. Bureau of Labor Statistics.

The new pay terms

• A 10% guaranteed raise effective October 16, 2026
• A 4% raise in the March 2027 review
• 6% wage pools in 2028, 2029, and 2030, each with a guaranteed 4% raise
• Revised work-from-home rules and tighter overtime limits

Why higher labor costs still pressure Boeing’s commercial margins

The raises increase Boeing’s fixed expenses while its commercial airplane margins are already thin and free cash flow is still recovering.

Boeing guided free cash flow to a range of $1 billion to $3 billion for 2026. Higher wages make those cash targets harder to hit if there is a delay in deliveries.

The company made a decision to pay more now to keep lines running and certifications on schedule.

How Boeing stock compares with RTX and GE Aerospace in 2026

BA is down about 7.6% year to date, even after Friday’s jump. 

RTX and GE Aerospace both posted double-digit gains in 2026, while the iShares U.S. Aerospace & Defense ETF (ITA) sat in between, according to Yahoo Finance. 

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The reason is their business models. RTX relies on diversified defense revenue, and GE Aerospace on recurring engine servicing. 

Boeing depends on building and certifying jets, which ties its results to production progress.

What still has to happen before Boeing’s comeback holds

The deal is tentative. SPEEA members still have to vote to approve it over the coming days.

If they approve, Boeing’s focus shifts back to execution. The company must build jets faster and finish certifications. 

Boeing is already delivering more jets than at any point since 2018.

What BA investors should watch next

• The ratification vote result
• Progress on 777-9 and 737 MAX 10 certification
• Whether rising labor costs pressure commercial margins
• The defense drag, after a $280 million Air Force One charge hit second-quarter results

For now, Boeing removed a near-term threat. The harder task is to turn that relief into steady cash flow.

Related: Two defense stocks just got a multiyear vote of confidence