Boeing executives say a prolonged strike could wound the company, which is behind schedule on the fuel-saving Dreamliner 787 and has seen high demand ramp up production by 50 percent this year.

I’m all shits and giggles for Boeing. I know in my heart that they think about their workforce the same as the likes of Kongsberg Automotive and American Axle, not a squat.

When fuel prices soared and profits plummeted, the Executives of Continental Airlines did something different, they decided to forego pay.

The virally anti-union JetBlue’s CEO took a 50% pay cut from August to the end of the year and Airtran’s Bob Fornaro opted for a 15% pay cut. Clearly, these are nothing in comparison to the massive pay cuts taken at Continental by CEO Lawrence Kellner and President Jeff Smisek.

With the recent talk of a bailout of Wall Street and the massive salaries for CEO’s, actions like that of Kellner and Smisek are even more out of the ordinary, they are down right singular. That’s one of the reasons I wonder about the current actions of Boeing and their desire to only compensate workers when what they want is to help make Boeing a better company, more profitable and producing a better product. Boeing has a work force dedicated to the success of Boeing.

The union is using the strike to attack the company's relentless outsourcing. In the 2002 contract Boeing won the ability to use non-union suppliers for more parts. The union wants a six-month window where it could bid on work before it is outsourced.

If the Machinists can come up with a proposal and show that we can do it cheaper, better, that quality work is there, we should be able to keep that work in-house," said Local 751A steward Steve Parsley.

Boeing hasn't shown much interest in letting the union make its case. The company complained the union was trying to tell it how to run the business, and instead touted its proposed 11 percent wage boost over three years. Boeing negotiator Doug Kight reportedly called his proposal "the best contract offer in America this year."

Wage increases are great, especially for the worker coming in making $11 an hour, however, it means nothing if you have to pay higher prices for prescriptions and insurance and oh yeah, this one:

Boeing's proposal, however, would… take away the family's right to a pension if a worker dies.

With Boeing hovering at 5 to 7% labor costs per plane produced and…

Aircraft maker Boeing has been groaning under a $275 million backlog of orders for new airplanes that waste less fuel. The company booked a $4.1 billion profit last year, and its principal union, the Machinists (IAM), says Boeing's profits have soared by 828 percent in recent years.

When your workers make you profitable, why is it they can’t share in the success? When things are bad, they take concessions to keep the company afloat, but when things improve and they have made it possible for the company to bring in $4.1 BILLION in profits in 1 year, then then contract that’s offered, the one that’s put forward should take into consideration the sacrifices made to bring the company to this position. I know American Axle and Kongsberg Automotive don’t understand this concept, but if Continental’s CEO and President can get it and sacrifice themselves, then why can’t Boeing figure this out?

Boeing, let me break it down for you:

When you invest in your people, they’ll invest in you. When you’re good to your people, they’re good to you. When YOU sacrifice for your people, they’ll sacrifice for you. But when you screw them with reduced benefits and offer nominal pay increases in the face of massive profits and current substantial backorders, well, don’t expect anything less than a strike, it’s really the only option left on the table for your workers.

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Continental cuts workforce and more due to fuel costs

DALLAS -- Continental Airlines said Thursday it is cutting 3,000 jobs and reducing capacity by 11 percent, citing record fuel costs that have pushed the industry into its worst crisis since 2001. It also said its two top executives will forgo pay for the rest of the year.

The job cuts represent about 6.5 percent of the company's work force of 45,000.

However, Continental seems to have a conscience:

The company also said Chairman and Chief Executive Lawrence Kellner and President Jeff Smisek will not take salaries or incentive pay for the rest of the year.

Did you catch that, from September until the end of the year, Kellner and Smisek will forego pay. And how much is that exactly? The Post claims:

Last year, Kellner got a salary of $712,500 and total compensation that the company valued at nearly $6 million, down 9.3 percent from the year before, according to an Associated Press analysis of a company filing with the Securities and Exchange Commission.

However, about one-third of Kellner's compensation was in stock and option grants that are now worth far less than they were when granted in February 2007 because of the slump in the company's stock. In a filing Wednesday, the company said 2008 salaries would be $296,875 for Kellner and $240,000 for Smisek.

So this salary issue made me start thinking about Dick E Dauch at American Axle and his entitlement mentality. Not long back, over at Freep (Detroit Free Press), there were all these anti-union folks pointing out that Dauch’s more than $10 mill was fair compensation for him starting the company and making it profitable. That even if they weren’t profitable (they were last year at over $37 mill profits), he still deserved a high salary of over $1mill. I wonder how many of these same people are cheering Kellner’s and Smisek’s decisions to forego pay during the current fuel crisis.

But before anyone gets their panties in to a bunch and quotes me anything about how Americans get paid too much and CEO’s earn their keep or that labor is a commodity and blather on about the market, let me point out this gem from the Post:

The company said that several fare increases have not been enough to offset the rising cost of fuel. Continental estimates it will spend $2.3 billion more this year than last _ a difference of $50,000 per employee. Fuel has surpassed labor as Continental's biggest expense.

My dad’s shop is having a similar problem. The cost of running the presses and hammers is high and he’s trying to get the company to add a fuel surcharge to orders but he hasn’t been successful at this yet. Since my dad gets a profit sharing incentive through work as his bonus, it’s important to him that the company make money and he’s sitting back and watching as his 1 to 2% bonus becomes fuel for running a hammer for a couple of days. Kind of sucks, doesn’t it?

I’m hopeful that Continental will be able to work things out without layoffs, perhaps through buyouts or retirement or attrition, because I really don’t want to see anyone have to figure out how to make it in this economy without a job and no prospect for new employment.

BTW, my dad’s shop is hiring. They’d rather hire seasoned journeymen level press operators, tool and die makers and machinists. So, if you’d like to move to Ohio, East of Cleveland, drop me a line and I’ll send your info to my dad. Ohio’s a great place to grow up, I just wish I were able to suggest something for the Continental employees.

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