Boeing Co. machinists walked out on strike Saturday after talks with a federal mediator failed to produce an agreement. About 100 union members hoisted their strike signs at 12:01 a.m. outside the Boeing plant in this city north of Seattle, cheering and blasting air horns at passing cars, many of which honked back. "It's been about lack of respect," said Steve Morrison, 42, a tester at the Everett plant. "They always tell us we're valued much but labor is the first out the door, the first to be outsourced."

This is the machinists' second strike in as many contract negotiations with Boeing. They struck for 24 days in 2005.

The machinists assemble Boeing's commercial planes and some key components. Key strike issues include pay, outsourcing, retirement and health care benefits.

The company said it would not try to assemble planes during the strike.

Boeing spokesman Tim Healy said the company is open to further discussion, but both sides were too far apart to reach an agreement. No additional talks were scheduled.

Union members voted to strike on Wednesday, but both sides agreed to a 48-hour contract extension - requested by Washington Gov. Chris Gregoire and a federal mediator. However, negotiations failed Friday and the strike was on.

The union bargains for about 25,000 workers in the Puget Sound area, 1,500 in the Portland, Ore. area and about 750 in Wichita, Kan.

"We're not greedy, we just want a piece of the pie," said Scott Daniels as he helped make picket signs late Friday. "They offer us bonuses. We don't want bonuses." Machinists want an improved 401k and improved vacation, he said.

Analysts have said a strike could cost Boeing about $100 million per day in deferred revenue. During the last strike, Boeing was unable to deliver more than two dozen airplanes on schedule.

Boeing's commercial airplane manufacturing operation, based in the Seattle area, has led a resurgence by the company over the past two years amid heavy orders for its much-awaited and increasingly delayed 787 Dreamliner aircraft.

Overall, the company reported in July a backlog of airplane orders worth $346 billion.

Asked why he thought a strike would be effective, Eras Gattshall, a 47-year-old aerospace mechanic in Everett, replied, "Boeing is its best financial shape in years. All we're asking is a fair wage."

Gattshall has been with Boeing for 12 years but has been laid off twice.

Tom Wroblewski, president of Machinists District Lodge 751, declared in a statement Friday that Boeing had "disrespected the finest aerospace workers anywhere on the planet" by failing to meet machinists' expectations.

In a last-ditch attempt to avoid a paralyzing strike, negotiators for the aerospace giant and the union had jetted off to a Disney resort in Florida, in part so Tom Buffenbarger, International Association of Machinists international president, could participate. He was at the resort for an IAM convention.

"Over the past two days, Boeing, the union and the federal mediator worked hard in pursuing good-faith explorations of options that could lead to an agreement," Scott Carson, president and CEO of Boeing Commercial Airplanes, said Friday in a statement. "Unfortunately the differences were too great to close."

Boeing operations in Washington, Oregon and Kansas will remain open, Carson said. Employees, such as engineers, who are not represented by the Machinists are expected to report for work as usual, he added.

Boeing's "best and final" three-year contract offer included bonuses totaling at least $5,000 and averaging $6,400, raises averaging 11 percent, pension increases and a 3 percent cost-of-living adjustment - $34,000 in average pay and benefit gains per employee, according to the company.

The average Boeing machinist earns $27 an hour, or about $56,000 a year, before overtime and incentives.

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On the Net:

http://www.boeing.com/2008negotiations/

http://www.iam751.org/contract08.htm