New Boeing CEO to give clues about company’s future, while striking workers vote on new contract

Boeing has already braced investors for a rough quarterly report. Now, new CEO Kelly Ortberg has the chance to share his vision for the troubled manufacturer, from a potential strike-ending labor agreement to a slimmed-down future.

When he takes the mic for his first earnings call as Boeing’s CEO on Wednesday, more than 32,000 striking machinists will start voting on a new, sweetened contract proposal. Results of the labor vote are expected Wednesday night.

Analysts are cautiously optimistic that the new proposal, which requires a simple majority of the vote, could pass, putting an end to the more than five-week work stoppage that has halted most of the company’s production of airplanes and added to its cash burn of about $8 billion in the first half of the year. Boeing last posted an annual profit in 2018.

“I think it’s going to be a tight vote,” Jon Holden, president of the International Association of Machinists and Aerospace Workers District 751, told CNBC on Tuesday.

During Boeing’s earnings call, investors, analysts and the public could get clues from Ortberg about what Boeing will look like in the coming years as well as clearer estimates on the company’s production targets for the next year.

Executives at key Boeing suppliers GE Aerospace and RTX told investors on Tuesday that they are looking toward the work stoppage ending with a new agreement.

RTX CFO Neil Mitchill said on an earnings call that in the company’s Collins unit, commercial aircraft component sales to manufacturers will be flat this year, down from mid-single-digit growth it previously forecast.

“This outlook assumes that we’re able to restart some level of shipments to Boeing in the fourth quarter, and we see no change to the long-term structural demand” for products to plane makers, he said.

Narrowing businesses

Ortberg, a longtime aerospace veteran who previously ran Rockwell Collins, took the reins at Boeing in early August. His tall order was to right the ship.

The year began with a terrifying midair door plug blowout on one of Boeing’s new 737 Max planes after it left the factory without key bolts reinstalled. The near-catastrophe occurred just as the company’s leaders were hoping to have regained the trust of regulators years after two deadly crashes killed 346 people, the first of them six years ago this month.

Instead, Boeing’s rebuilding year is getting pushed to 2025, and Ortberg has hinted at big changes ahead, promising employees and the public greater focus at the 108-year-old company. Earlier this month, he said Boeing will slash 10% of its global workforce, about 170,000 people.

“We need to be clear-eyed about the work we face and realistic about the time it will take to achieve key milestones on the path to recovery,” he told employees in an Oct. 11 message. “We also need to focus our resources on performing and innovating in the areas that are core to who we are, rather than spreading ourselves across too many efforts that can often result in underperformance and underinvestment.”

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