Kerry Lynch stepped into the role of editor of the&nbsp;Aviation International News&nbsp;monthly magazine in May 2022 after serving with&nbsp;AIN&nbsp;for eight years. She joined&nbsp;AIN&nbsp;in December 2014 as a senior editor covering Washington and business aviation news. She has also served on Convention News teams, including as editor of&nbsp;HAI Convention News. Lynch previously spent 25 years with Aviation Week. During her time there, she reported for and later steered&nbsp;The Weekly of Business Aviation, oversaw business aviation content on the&nbsp;Aviation Week Intelligence Network, served on the&nbsp;Show News&nbsp;staff, and held roles as the Washington columnist for&nbsp;Business &amp; Commercial Aviation&nbsp;and&nbsp;Overhaul &amp; Maintenance&nbsp;monthly magazines. In 2021 she was honored with the National Business Aviation Association Platinum Wing Award for lifetime achievement in journalism and was the 2004 recipient of the National Air Transportation Association’s Aviation Journalism Excellence Award. She also has been a recipient of an Aerospace Media Award for business aviation (2022) and NBAA Gold Wing Award (2003, 2024). Lynch graduated from The Ohio State University with a bachelor of arts in journalism.

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Kerry Lynch

Bombardier manufactures a variety of business aircraft models, provides engineering, and aircraft maintenance services.

Despite the robustness of order books, strong pricing, and flying that still outpaces pre-pandemic levels, the business aviation industry and perhaps the larger aviation industry have navigated into choppy waters. During JetNet’s recent iQ Summit, iQ survey founder and head of Rolland Vincent Associates Rolland Vincent noted that “We’re in a bit of a strange” place with geopolitical tensions, inflation, interest rate changes, and presidential election uncertainties. The result? Industry net optimism has reached its lowest point since the initial Covid surge in 2020, with many believing that the current business cycle has yet to hit bottom.
Adding to all of this is a supply chain system that has remained stubbornly fragile and rising labor disputes that hit NetJets earlier this year through various pickets and other campaigns, Bombardier through a brief strike in July, and most recently Textron Aviation, which now has 5,000 workers on strike. Of course, the Boeing strike, affecting 33,000 workers, may eclipse all of that.
Each one of those labor issues is unique. In NetJets' case, there was a mid-contract dispute as pilots eyed significant increases of their contemporaries at the likes of American, United, and Delta Air Lines. Rhetoric ratcheted up between the two sides, with the pilots’ union calling into question training and maintenance culture and the fractional provider ultimately suing for defamation. However, the union agreed to a $1.6 billion (or 52.5%) increase in compensation from 2024 through 2029.
With the OEMs, contracts were coming due at a time when workers have grappled with temporary work stoppages in some cases during Covid, and perhaps more importantly high costs of living in most cases, given the rampant inflation that set in amidst Covid. And while inflation has moderated, many prices still exceed their pre-pandemic levels while workers continued under earlier contracts.
All of this provides leverage on the workers' behalf, but as Brian Foley, of Brian Foley Associates, said, “It’s a little more heartfelt” this time. “There's definitely something beyond just trying to get some concessions and wage increases.”
Workers are trying to adjust their standards of living that perhaps have not recovered since the pandemic. In Boeing’s case, the discord runs deep and for a long time.
Most recently, talks have stumbled after Boeing offered a 30% increase over four years, up from the 25% it initially offered. The International Association of Machinists and Aerospace Workers (IAM) earlier had recommended acceptance of the contract, but on September 12, union members rejected it. Ultimately, the union wants a 40% increase. Striking union members, numbering around 33,000, are doing so now without their healthcare benefits. Analysts worry that the Boeing strike could be protracted and costly.
However, Bombardier was able to quickly resolve its dispute, perhaps with the realization of its workers of the company’s long—and continuing—climb out&nbsp;of debt. Bombardier workers agreed to a 12.5% increase over a three-year contract after striking for 18 days.
With Textron Aviation in Wichita, analysts are seeing pragmatism on all sides and predicting that it might last maybe a month. Workers there rejected a 26% increase over four years.
For companies, this comes against a backdrop where many are trying to play catch-up after dealing with the supply chain that has tempered production rates despite near-unprecedented books to bill. One analyst predicted that the strike at Textron Aviation could delay 15 aircraft deliveries at a cost of $300 million. At Boeing, the strike could be crippling for a company that has faced a series of setbacks, including some self-inflicted wounds.
Vincent told AIN that if Textron Aviation doesn’t settle shortly, “We're taking our [business jet] forecast down… we're getting close to taking the forecast down right now because Textron is 25% to 30% of the output in the industry in terms of units and massive, and 40% of the fleet out there.”
Should OEMs prepare for this as more contracts come up in the future? Bombardier still must negotiate in Montreal, likely beginning next year, for instance.
Meanwhile, they also need to balance against a supply chain that may now be the new normal. “It’s just a normal course of business now,” Foley said. “You have to bake that into your strategy.”
Labor shortage has been a primary issue surrounding supply chain hiccups. And now labor disputes are factoring in as well.
Foley said of the delivery outlooks: “I've been anticipating a catch-up time for the last two or three years, and it just never seems to materialize.”

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In this article

NetJets

Boeing

Textron Aviation

Bombardier

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