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About 30,000 workers in Seattle and Portland areas to

strike

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Boeing ( BA ) already wrestling with output delays, high debt

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Strike poses a challenge for its new CEO Kelly Ortberg

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Shares fall 3.4% in pre-market trade

(Adds background, share reaction, details on Boeing's ( BA ) problems

and the strike in paragraphs 2-5, 9, 17, 18)

By Joe Brock and David Shepardson

SEATTLE, Sept 13 (Reuters) - Boeing's ( BA ) U.S. West

Coast factory workers walked off the job early on Friday after

overwhelmingly rejecting a contract deal, halting production of

the planemaker's strongest-selling jet as it wrestles with

severe output delays and heavy debt.

The workers' first strike since 2008 comes as the planemaker

is under heavy scrutiny from U.S. regulators and customers after

a door panel blew off a 737 MAX jet mid-air in January.

The mounting crises battered Boeing's ( BA ) stock and sparked a

leadership upheaval. Boeing ( BA ) shares fell 3.4% in U.S. pre-market

trading on Friday.

New CEO Kelly Ortberg CEO Kelly Ortberg has to confront a

labor-management battle just weeks after he was brought in to

restore faith in the planemaker.

He proposed a deal including a pay rise of 25% over four

years, far lower than the 40% workers had demanded.

Roughly 30,000 International Association of Machinists and

Aerospace Workers (IAM) members who produce Boeing's ( BA ) 737 MAX and

other jets in the Seattle and Portland areas voted on their

first full contract in 16 years, with 96% rejecting it and

favoring a strike in a two-part ballot.

"This is about respect, this is about addressing the past,

and this is about fighting for our future," said Jon Holden, who

headed the negotiations for Boeing's ( BA ) largest union, before

announcing the vote result on Thursday evening.

"We strike at midnight," said the union leader who had

agreed to the just-defeated deal, as members in the union hall

cheered and chanted: "Strike! Strike! Strike!"

BOEING ( BA ) 'READY TO GET BACK TO THE TABLE'

A long strike could badly hit Boeing's ( BA ) finances, which are

already groaning due to a $60 billion debt pile.

Boeing ( BA ) said late on Thursday the vote sent a clear message

that the tentative deal it reached with IAM leadership was not

acceptable to members.

"We remain committed to resetting our relationship with our

employees and the union, and we are ready to get back to the

table to reach a new agreement," the planemaker said.

The proposed deal also included a $3,000 signing bonus and a

pledge to build Boeing's ( BA ) next commercial jet in the Seattle

area, provided the program was launched within the four years of

the contract.

Although IAM leadership recommended last Sunday that its

members accept the contract, many workers had responded angrily,

arguing for the original demand and lamenting the loss of an

annual bonus.

"We're going to get back to the table as quickly as we can,"

Holden told reporters, without saying how long he thought the

strike would last or when talks would resume. "This is something

that we take one day at a time, one week at a time."

MULTIPLE CHALLENGES FOR BOEING

A strike presents Boeing ( BA ) with multiple challenges: it will

need to decide how to respond at the bargaining table, after

saying it had offered everything it could. It also must find a

way to secure factories full of valuable, partially built planes

without union workers to do the job.

Workers have been protesting all week in Boeing ( BA ) factories in

the Seattle area that assemble Boeing's ( BA ) MAX, 777 and 767 jets.

Shortly after midnight, striking workers started to gather

outside the entrances of Boeing ( BA ) factories in the Seattle area.

Many waved placards that read: 'On Strike Against Boeing', and

drivers passing by honked their car horns in support.

"I'm willing to strike for two months or even longer. Let's

go as long as it takes to get what we deserve," said James Mann,

a 26-year-old who works in a wings division at Boeing ( BA ).

If prolonged, a strike would also weigh on airlines that

depend on the planemaker's jets and suppliers who manufacture

parts and components for its aircraft.

Air India CEO Campbell Wilson said on Friday that Boeing's ( BA )

737 MAX deliveries to his airline appeared to be "delayed a

little bit" even before the strike announcement because of

regulatory scrutiny after the Alaska Airlines door incident and

supply chain issues affecting the broader industry.

"There's nothing official yet, but I think the indication

is, or the expectation is that it's going to be a little bit

later," he said in an interview in Sydney.

According to a pre-vote note from TD Cowen, a 50-day strike

could cost Boeing ( BA ) an estimated $3 billion to $3.5 billion of

cash flow.

The Boeing ( BA ) workers' last strike in 2008 shuttered plants for

52 days and hit revenue by an estimated $100 million per day.

S&P Global Ratings said that an extended strike could delay

the planemaker's recovery and hurt its overall rating. Both S&P

and Moody's rate Boeing ( BA ) one notch above junk status.

The White House did not immediately respond to a request for

comment.