Boeing workers voted to end a 7-week strike, accepting a new contract that will raise 38%.

Workers at Boeing’s West Coast factory accepted a new contract on Monday, ending a bitter seven-week strike that has halted production of many planes and deepened the embattled planemaker’s financial crisis.

The union said members voted 59 percent in favor of the new contract, which includes a 38 percent wage increase spread over four years, easing pressure on new Boeing CEO Kelly Ortberg after two previous requests were voted down in recent weeks.

“This is a victory. We can hold our heads high,” said Jon Holden, a spokesman for the union, to members after the results were announced. “Now our job is to get back to work.”

However, Boeing refused to meet the strikers’ demand to restore the company’s pension plan that was suspended nearly a decade ago.

The end of the first strike in 16 years by Boeing’s largest union provides welcome relief for a company that has bounced from one situation to another since a door strike knocked the nearly new 737 MAX out of the air in January.

In a message to Boeing employees after the vote, Ortberg said he was pleased the union had accepted the deal.

“Although the past few months have been difficult for all of us, we are part of one team,” he said. “There is much work to be done to return to the excellence that has made Boeing a great company.”

About 33,000 mechanics who work on the best-selling 737 MAX jet, as well as the 767 and 777 wide-bodies, have been on strike since September 13, demanding a 40 percent pay increase and the return of defined benefit pensions. they lost the last decade with a 401(k) retirement plan.

The old pension has not been returned

“I’m ready to get back to work,” said David Lemon, a certified mechanical fitter in Seattle who voted for the contract.

He calculated that the four percent salary increase and bonus — the guaranteed minimum annual pay in the cash back program — added up to the 40 percent increase they were after. “We got there,” he said.

The old pension will not be returned, but employees receive compensation from the company that matches contributions to their 401(k) plans.

Boeing also promised to build the next plane in the Seattle area. “They never gave us a commitment” to the new plane before launch, Holden said.

US President Joe Biden and Acting Secretary of Labor Julie Su, who was in charge of the contract negotiations, congratulated the workers and the company on the outcome. “We’ve shown that collective bargaining works,” Biden said.

Boeing said Su was instrumental in moving both sides to reach a definitive agreement.

Biden has been a strong supporter of unions as president, and the union vote comes a day before Americans go to the polls to choose his successor.

Boeing will now take weeks to ramp up production of the plane and improve cash flow, with 737 MAX output expected to decline by single digits per month for some time, according to two people briefed on the matter, well short of the 38 per month previously targeted. strike.

The strike costs $100M US per day

Workers can begin to return to building airplanes from Wednesday, the International Association of Machinists and Aerospace Workers (IAM) said, although Boeing warned that some people would need to be retrained due to long periods away from the factory floor.

The strike cost Boeing about $100 million a day in lost revenue, analysts said, prompting the planemaker to raise $24 billion from investors last week in an effort to maintain an investment-grade credit rating.

Ortberg now needs to repair relations with Pacific Northwest machinists who have used the strike to vent anger that has built up over a decade when wages have fallen in line with inflation and the cost of living in the Seattle area has risen.

The union said its members have received only four percent of their salaries in the last eight years.

“I’m disappointed to say the least,” said 777 employee Thomas Amilowski, who voted for the contract. He said the leadership of the unions, which supported the proposal in the first vote that was rejected by almost 95 percent of the members, “has a sense of defeat.”

Holden noted that the 59 percent approval rating meant that “there were some who were very unhappy with the vote.” But he added that workers can rebuild relationships with Boeing leadership.

Boeing said the average annual salary for mechanics at the end of the new four-year contract will be $119,309 US, up from $75,608 previously.

The wage increases could add $1.1 billion to Boeing’s payroll over four years, while a $12,000 confirmation bonus for each union member could result in another $396 million in outflows, according to Jefferies analysts.

More than 26,000 union members voted, with a turnout of close to 80%.