News that the Boeing Co. will buy a manufacturing plant in South Carolina set off a tidal wave of speculation Tuesday — mainly about whether the jetmaker plans to expand its 787 assembly line beyond Everett.
The Charleston-area facility will cost Boeing $580 million. That’s roughly the cost of three or four 787 Dreamliners, depending on the model.
It’s not quite clear what the purchase will mean for Everett’s chances of landing a much-sought-after second production line for the still-delayed 787. But with nerves already raw because of the 787’s late first-flight schedule, public officials scrambled Tuesday to characterize how Boeing’s Monday deal might affect operations in Everett.
The plant, owned by Texas-based Vought Aircraft Industries, has been home for the production and installation of the 787’s rear fuselage, made from lightweight carbon composites. Boeing’s purchase of the plant from its 787 partner could help resolve production delays that have plagued Vought and resulted in billions of dollars in expenses and penalties for Boeing. The deal is expected to close this fall.
“Integrating this facility and its talented employees into Boeing will strengthen the 787 program by enabling us to accelerate productivity and efficiency improvements as we move toward production ramp-up,” CEO of Boeing Commercial Airplanes Scott Carson said. “In addition, it will bolster our capability to develop and produce large composite structures that will contribute to the advancement of this critical technology.”
Boeing has taken a global approach to airplane manufacturing in recent years, choosing to have parts manufactured around the world, then flown to Everett for assembly. But the purchase of the Vought plant means Boeing now has other final assembly options, not to mention a more powerful bargaining chip in negotiations with unions.
The Charleston facility is much smaller than Everett, employing only about 500 workers to Everett’s 25,000. But it is surrounded by undeveloped land and could be easily expanded.
Gov. Chris Gregoire said she learned that Boeing would buy the Vought facility Monday in a phone conversation with Carson and was told the decision stemmed from a desire to build 787s as efficiently as possible.
“I have to rely on the words of Scott Carson,” she said at a Tuesday meeting in Everett on the state’s aerospace industry. “(He said) this had nothing whatsoever to do with a second 787 line.”
She said Carson told her no decision would be made on the location of a second line until fall at the earliest.
Gregoire conceded that the cost of manufacturing airplanes in South Carolina might be lower than in Washington, but she said the state’s work force is better. She said she’s working with Boeing management and labor unions to reconcile a somewhat hostile past marred by strained negotiations and work-halting strikes.
A long history of tense labor relations between Washington workers and Boeing has given weight to speculation that the company was looking to locate its second line in a region with weaker unions — possibly a Southern state.
Tom Wroblewski, president of the Machinists union, said reduced outsourcing is a good thing and that he doesn’t see a strong correlation between the newly acquired plant and the second 787 line.
“Boeing has noted this is not a statement of where the second 787 line is going to be located,” Wroblewski said. “When that issue is discussed, we will do everything in our power to ensure that Puget Sound is at the top of the list and highlight all the advantages that have made this region the largest aerospace center and Boeing the premiere aircraft manufacturer in the world — one that other cities are trying to emulate.”
Rick Bender, president of the Washington State Labor Council, AFL-CIO also weighed in, saying: “The Vought purchase is a welcome sign that Boeing intends to regain some control of its supply chain. … not a reason to panic about whether the company has decided to move out of our state.”
While Boeing has remained tight-lipped about Everett’s chances, the state has started making overtures. Gregoire assembled an aerospace advisory council a few months ago, and she has made repeated attempts to meet with Boeing executives in Chicago.
Senate minority leader Mike Hewitt, R-Walla Walla, said Tuesday’s announcement was “not good news for the people of Washington.” Hewitt, who serves on the Washington Council on Aerospace, said Boeing’s new plant is the latest in a “long line of warning signals.”
“Work stoppages over the past several years have cost Boeing $9 billion dollars in revenue and $2 billion dollars in lost profits,” Hewitt said. “Why wouldn’t Boeing look to expand elsewhere given this dismal record?”
Others, including Snohomish County Executive Aaron Reardon, were more temperate — but no less concerned. Reardon found the news “not surprising at all,” and said the purchase sends the message that Washington is clearly in competition with South Carolina.
“If the second 787 line is located somewhere else other than here, we will notice a precipitous decline in the job base,” he said. “If these jobs go away, they will not be replaced.”
Herald writer Noah Haglund contributed to this report.
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