Boeing's recovery on hold as workers strike strains finances

Catch up quick: 64% of union members voted against ratifying a new contract, the International Association of Machinists and Aerospace Workers (IAM) announced last night.

• That's better than the 95% rejection rate of the company's earlier offer that kicked off the strike six weeks ago, but there's more work left to be done before workers return to resume making planes.

The big picture: Boeing shares have already fallen 40% this year, and shed just 2% more after yesterday's news.

• Looming larger now is the possibility of the company losing its crucial investment-grade credit rating. Two of the main ratings agencies, S&P and Moody's, both warned recently that a prolonged strike could trigger a downgrade as Boeing continues to burn through cash.

Zoom in: A fall into junk territory — the category of bonds that have a higher risk of default — would be an ominous signal, a highly symbolic fall from grace that also carries practical consequences: Borrowing would be much more expensive.

The bottom line: Boeing is in the plane making business, and the longer the strike goes, the fewer planes it can deliver.