The Boeing Company (BA) Morgan Stanley‘s 12th Annual Laguna Conference 2024 summary

Labor relations and strike impact

• Union members rejected the contract with a 96% vote, leading to a strike and production halt.

• Leadership is actively engaging with employees to address concerns and aims to restore trust and reach a new agreement.

• The strike's duration will dictate financial and operational impacts, with immediate focus on cash conservation.

• Communication with customers, suppliers, and regulators is ongoing during the work stoppage.

• The company intends to return to negotiations to resolve the dispute.

Leadership priorities and strategic direction

• New CEO's top priorities are commercial business recovery, defense business stability, and maintaining investment-grade credit.

• Emphasis on leadership presence at the factory floor to foster closer engagement with employees.

• The CEO's approach is seen as a positive shift in company culture.

Production, deliveries, and regulatory environment

• Progress was made toward stabilizing 737 MAX production, with deliveries ramping up before the strike.

• FAA oversight and safety metrics are central to increasing production rates, but the strike delays progress.

• August saw three consecutive months of 737 MAX deliveries in the thirties, with significant inventory reduction.