Business

<< Previous   of   Next >> (click to enlarge) A Boeing job fair drew a number of applicants to the WorkSource office in Everett in July. (click to enlarge) Boeing rolled out the first Dreamliner on schedule July 8. (click to enlarge) A Boeing Dreamlifter delivers a part for the first 787 in April. (click to enlarge) Mike Bair (left), who was replaced as head of the Dreamliner program in October, joins Kunio Shimizu, a Japan Airlines vice president, as they announced the 500th 787 order in April. (click to enlarge) Boeing drew on many of the Dreamliner's design concept for the new 747 Intercontinental, a passenger version of its hot-selling Freighter. (click to enlarge) Boeing employees (from left) Grace Holland, Mayo Powell, Jesse Cote II and Joe Crockett show their support for the KC 767 tanker program at an August rally for the project at the Boeing assembly facility in Everett.   ADVERTISEMENT   Related Stories • Boeing confirms new delay in 787's first flight, delivery 1/16/08 • Boeing edges Airbus on orders in 2007 1/16/08 • Northrop calls its tanker less risky than Boeing’s 1/15/08 • Boeing may again delay Dreamliner's first flight 1/15/08   CONTACT THE HERALD Mike Benbow, Business Editor benbow@heraldnet.com   Published: Monday, December 24, 2007 Boeing challenges spill over into 2008 Keeping the the Dreamliner on track ... Competing for a lucrative tanker deal ... Keeping an eye on rival Airbus ... Boeing's strong 2007 means one thing: The jetmaker has its work cut out in the new year. By Michelle Dunlop Herald Writer This year ushered in a number of major happenings in aerospace of importance to Snohomish County residents. The Boeing Co. began the year riding the high of besting rival Airbus in commercial jet sales in 2006 -- the first time since 2000. Both companies continued to rake in major jet orders in 2007. The two aircraft makers each experienced major accomplishments and saw setbacks. With more than 20,000 aerospace workers in Snohomish County, the area certainly feels the highs and lows of the industry. Here's a list of some of the top aerospace stories for Snohomish County in 2007: The celebration of the year When Boeing rolled out its new 787 Dreamliner on 07/08/07, the company drew worldwide attention. Airline executives flew in from Singapore, India, Australia and China to watch as Boeing revealed its first new jet in more than a decade. The aerospace company also invited representatives from its 787 partner locations in Italy, Japan, South Carolina and Kansas, to attend the ceremony, which was broadcast on cable television and Webcast around the world. The governor addressed a crowd of Boeing employees gathered at Qwest Field. And the Future of Flight Aviation Center hosted a viewing party from its observation deck in Mukilteo. Even Airbus extended its congratulations on the emergence of Boeing's fast-selling, carbon-fiber 787 Dreamliner. Boeing's celebration for its new jet included a three-day fanfare for media and guests, including a daylong briefing in Seattle, tours of Snohomish County and a "Parade of Planes." Boeing spent more than a year planning the hoopla, relying on more than 350 volunteers and public relations officers for the events. The rollout gave Boeing's stock a boost, sending it well over $100. Quote: "We want this new plane bad." -- Jeff Misner, chief financial officer, Continental Airlines. Biggest story that didn't happen in 2007 The saga of the U.S. Air Force tanker contract saw its share of peaks and valleys in 2007. First of all, the agency planned to announce the winner of this multi-billion dollar deal in the fall. It since has pushed back the award date to the end of the first quarter in 2008. At the beginning of the year, Boeing hadn't made its choice between a 777- or a 767-based tanker. Rival competitor, duo Northrop Grumman and EADS, suggested it might not even submit a bid if it determined the Air Force already favored Boeing. And analysts generally assumed Boeing would walk away the winner. By March, Northrop-EADS seized every opportunity imaginable to emphasize their KC-30 tanker as "American-made." The pair's tanker, based on Airbus's A330 jet, will be assembled in Alabama, and will create as many as 25,000 U.S. jobs, the companies say. By mid-year, analysts began discussing in earnest the possibility of the Air Force splitting the contract. Boeing recruited Washington state's Congressional delegation to talk up the benefits of a Boeing win. Months later, Boeing officials emphasized their experienced work force in Everett, where its KC-767 will be assembled, and insinuated Northrop workers in Alabama lacked the know-how needed to build tankers. Northrop pointed out that Boeing was late in delivering tankers to Japan and Italy. As the year closes, the Air Force said it would stick to a sole winner. And observers once again deduced that winner will be Boeing. Quote: "If it's built in Alabama, it's built in America." -- Wes Bush, Northrop president, in March. Aerospace employment soars in the state The strong demand for Boeing jets has created a seemingly endless need for aerospace workers in the Puget Sound region. Over the course of 2007, Boeing has added more than 5,000 workers in Washington state. Through November, Snohomish County increased its aerospace workers by 4,700. Potential employees stood in a line that wrapped around Everett Station during a job fair that Boeing held in July. Boeing has held hiring events frequently around the region in 2007. Boeing's Machinists union even recently lent a hand in recruiting new workers. The aerospace company has hired more than 12,000 Machinists in less than four years. To be considered, Boeing requires job candidates to complete several weeks of training -- some of it unpaid -- once the job seeker passes a skills assessment. Quote: "We feel fortunate that Boeing is still considered an employer of choice in the Puget Sound region." -- Rich Hartnett, who oversees hiring for the company. Record jet orders, but Airbus is right there, too Both Boeing and competitor Airbus have booked more than 1,000 orders each in 2007. By the end of November, Boeing had beat its own sales record and hit the 1,000-order mark for the third consecutive year. With one week left in 2007, Boeing listed 1,213 net orders on its orders and deliveries Web site. The company has won nearly 800 orders for its fuel-efficient Dreamliner since the jet's launch. Despite an announced 787 setback, the jet picked up more than 300 orders in 2007, its best to date. Airbus also looks to hit a record in 2007, listing 1,204 orders on its Web site as of the end of November. With several tentative orders in the mix, the European company seemed poised to beat Boeing in sales this year. Each jet maker has a backlog of unfilled commercial aircraft orders topping 3,000. Some jet programs have lead times of more than five years. To meet customer requirements, Boeing and Airbus continue to steadily ramp up production to increase jet deliveries. Each reached delivery milestones in 2007. In December, Airbus handed over its 5,000th aircraft. Boeing delivered its 3,000th Everett-built widebody jet earlier in the year. Leadership shuffle This year brought several significant leadership shake-ups in aerospace. In October, Boeing replaced 787 chief Mike Bair with Pat Shanahan, a vice president for Boeing's defense business. Bair supervised the Dreamliner from its infancy up until its first major delay. Shanahan, who also has experience on the commercial jet side, has been credited with turning around several troubled programs. The reassigned Bair moved over to a marketing role. Both the major unions at Boeing also saw leadership changes, which could be significant when the labor groups meet with Boeing to negotiate new contracts in 2008. The local district of the International Association of Machinists and Aerospace Workers elected a new president, Tom Wroblewski in March. Wroblewski replaced Mark Blondin, who accepted a promotion with the international union. The union represents more than 20,000 Machinists in the Puget Sound region. The labor group that represents Boeing engineers -- the Society of Professional Engineering Employees in Aerospace -- replaced five of its top eight positions over the course of 2007. The four board members who ousted the union's former executive director in July were forced out during a recall vote in the fall. The turmoil on the board delayed hiring a new executive director, who should be in place by the end of January. Quote: "(Pat Shanahan) knows how to deliver results, understands our customers and their requirements and has the leadership skills to get the job done." -- Scott Carson, president of Boeing Commercial Airplanes. The tale of two jumbos In October, Boeing rival Airbus delivered its first A380 aircraft. When the super jumbo jet went into service with Singapore Airlines, it bumped the claim of Boeing's 747 as the largest passenger jet flying. Early in the year, Boeing looked to profit from Airbus' prolonged problems with the A380. The Toulouse, France-based jet maker put on hold its plans to build an A380 freighter. The cargo version of the A380 had won 50 orders since Airbus launched its super jumbo. In halting work on its A380 Freighter, Airbus conceded the large cargo jet market to Boeing, which has dominated the freighter market for decades. Boeing has redesigned its 747, locking in the design in November. As of Dec. 18, Boeing listed 20 gross orders for 747s this year on its Web site. At the end of November, Airbus had 21 orders for its A380. Quote: "I have never been in anything like this in the air before in my life. It is going to make everything else after this simply awful." -- Australian Tony Elwood, who reserved a first-class suite on the maiden commercial flight of the A380. 787 delivery slides until late 2008 Just weeks after assuring analysts that it would deliver its first 787 in May 2008, Boeing bumped back the new jet's first flight and delivery by six months. The planemaker won't hand over its first 787 to All Nippon Airways of Japan until November or December 2008. The 787's maiden flight has been delayed until the end of March. Boeing officials pointed mostly to parts shortages and to the difficulty it experienced piecing together large 787 assemblies built by one of Boeing's global partners. The company radically changed the way it builds jets with the 787 -- requiring partners to ship mostly completed large sections of the jet to Everett for final assembly. Boeing predicts its workers in Everett will be able to put one 787 together every three days. The delay exposed problems in Boeing's new process. Despite the setback, Boeing executives say the 787 will be back on track by the end of 2009 when it will have delivered 109 Dreamliners out of the 112 it initially committed to customers. The company will continue to build 787s even while it puts the first six through flight test. Analysts worry this could expose Boeing to large amounts of corrective work should a major glitch be discovered as the company tries to obtain certification on the new jet. Quote: "We were surprised on the physical reality of some things." -- Jim McNerney, Boeing's chief executive. Reporter Michelle Dunlop: 425-339-3454 or mdunlop@heraldnet.com.

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