The Trial Balance is CFO’s weekly preview of stories, stats and events to help you prepare.
Part 1 — Boeing CFO comments on manufacturing strike
In a press conference on Friday The Seattle Times called “notably conciliatory,” Boeing CFO Brian West spoke after 33,000 machinists walked away from an agreement the union’s president referred to as “the best contract we’ve negotiated in our history.” As a result, the company announced on Monday the implementation of a hiring freeze in order to conserve cash.
During his remarks, West said, “The financial impact of this strike will depend on the length of the strike.” The last strike, which occurred in 2008, lasted 58 days.
West also said he and the other leaders, including the company’s new CEO Kelly Ortberg, want to “reach an agreement that’s good for our people, their families [and] our community.” He also spoke extensively about the company’s losses in defense and space initiatives and supply chain challenges across the company.
“This contract isn’t just words on paper; it’s a testament to your collective voice,” Jon Holden and Brandon Bryant, presidents of International Association of Machinists Districts 751 and W24, respectively, said. Despite their leadership’s encouragement, 96% of workers chose to strike, hoping to push the offer of a 25% wage increase over four years closer to the 40% mark, according to reports.
Boeing gets an estimated $10 million in free cash flow from every 737 MAX it delivers. In August, Boeing delivered 32 of these models, and in March it said its goal was to produce 38 per month by the end of the year. As of Friday, all airplane production at the company has come to a halt.
West and Ortberg, both of whom are personally involved in the initiative to reach an agreement, are on a time crunch to finalize the deal. Not only has production stopped, but their goal of having $10 billion in annual free cash flow by this time next year has already been in question, and the strike could further dampen those efforts.
Boeing’s contract woes are piling on to a growing number of challenges the company has had to overcome this year. This strike comes after multiple near-catastrophic product failures, the resignation of their former CEO Dave Calhoun after public pressure to step down, accusations of whisteblower intimidation and their recent Starliner debacle.
— Adam Zaki
Part 2 — This week
Here’s a list of important market events slated for the week ahead.
Monday, September 16
Tuesday, September 17
- U.S. retail sales, August
- Industrial production, August
- Capacity utilization, August
- Business inventories, July
- Home builder confidence index
Wednesday, September 18
- FOMC interest-rate decision (and subsequent press conference from Fed Chair Jerome Powell)
Thursday, September 19
- Initial jobless claims
- Philadelphia manufacturing survey
- Existing home sales, August
- U.S. leading economic indicators, August
Part 3 — First Horizon CFO, Empire State’s finances and CFO compensation
This week, CFO will publish a column from First Horizon Bank CFO Hope Dmuchowski on her lessons learned from becoming a CFO, data stories on notable findings from the Empire State Manufacturing Survey and findings from the Conference Board’s salary report.
In case you missed it, CFO.com’s virtual event CFO Live: The Future of Finance is available in its entirety here.
