McNerney says without Ex-Im Bank, Boeing work could move overseas

Boeing Co. Chairman Jim McNerney rattled his saber again Wednesday, suggesting the airplane maker would ship work overseas if Congress does not reauthorize the Export-Import Bank.

Speaking at the Economic Club of Washington, he said that Boeing is considering moving “key pieces” of the company to countries that offer export credits, Reuters reported.

The airplane maker is “now forced to think about this differently,” he told the audience, which included corporate executives and at least three foreign ambassadors, Reuters reported.

A company spokesman declined to provide further detail on McNerney’s comments.

The fate of the Ex-Im Bank, whose charter expired June 30, was left in limbo Tuesday after its renewal was not included in a short-term highway funding bill passed by Congress.

Without the bank’s financing, “U.S. manufacturers will have no choice but to consider increasing offshore production in countries that have export credit agencies,” McNerney wrote in an article published earlier this month in Politico, a publication covering inside-the-Beltway politics.

“This outcome is neither sought nor desired,” but it might be required for companies to compete abroad and continue delivering returns to shareholders, he said.

The head of the International Association of Machinists and Aerospace Workers’ (IAM) District Lodge 751, which represents about 32,000 Boeing workers in metro Puget Sound, criticized McNerney for threatening jobs here as political leverage.

“While we share his frustration with Congress and its failure to reauthorize the Ex-Im Bank, we are tired of Jim McNerney and his constant threats to take away our livelihoods and destroy our communities,” said Jon Holden, head of District 751, in a written statement.

The Ex-Im Bank, which was created during the Great Depression, provides financing for sales of U.S. goods overseas. Congress has to periodically reauthorize it, which usually occurs with little fanfare.

But some Republicans put the bank in their crosshairs last year, criticizing it as a corporate subsidy with little oversight. Critics derisively call it the Bank of Boeing, a nod to its biggest beneficiary.

The vast majority of the bank’s loans support small- and medium-sized businesses, supporters say.

This past fall, supporters managed to pass a temporary extension. However, Senate Republicans blocked reauthorizing the bank in June.

Since then the bank has not been able to provide new financing, but it is still administering existing agreements.

The district and IAM’s international leadership support reauthorizing the Ex-Im Bank.

Holden called McNerney’s implied threat to move jobs away “unacceptable.”

“Our workers in Puget Sound generate billions of dollars in revenue for Boeing, and our state’s citizens are committed to providing $8.7 billion in tax relief that will also boost Boeing’s bottom line,” he said in the statement. “Our members also have lobbied steadfastly for years in support of the Ex-Im Bank. And for that, all we get in return are more threats.”

Aerospace industry analyst Scott Hamilton called the comments “typical Boeing — they don’t get what they want, so they threaten to move jobs.”

Boeing had planned to use Ex-Im financing for 13 percent to 15 percent of its commercial aircraft sales this year, he said.

The company can provide much of that financing on its own, he said.

Citing unnamed sources, Reuters reported that the ongoing debate over the bank is making some companies question their planned purchases of a variety of Boeing products.

Having Ex-Im Bank financing can make the difference in the close competition with Airbus, which also gets publicly-supported export credit, Hamilton said.

While he supports reauthorizing the bank, Hamilton criticized McNerney’s habit of making vague, alarmist public statements.

McNerney is currently chairman of the company’s board of directors. He retired as Boeing’s CEO on July 1, closing out a decade running the Chicago-based company. He was succeeded by Dennis Muilenburg, the former head of Boeing’s defense side.

“I really hope Muilenburg takes a different tack,” but so far, he is an “enigma,” Hamilton said.

Dan Catchpole: 425-339-3454;; Twitter: @dcatchpole.

Talk to us

More in Herald Business Journal

The tower of Paine Field Airport stands in a fog bank forcing flights to be averted or cancelled in Everett, Washington on January 25, 2022. (Kevin Clark / The Herald)
More 5G-related cancellations as Paine Field fog persists

The FAA has not cleared certain planes to land in low visibility in Everett due to nearby 5G cellular towers.

Funko mascots Freddy Funko roll past on a conveyor belt in the Pop! Factory of the company's new flagship store on Aug. 18, 2017.  (Dan Bates / The Herald)
Despite Arizona move, Everett leaders expect Funko HQ to stay

The toymaker is closing Everett warehouses. But a recent “HQ2” expansion has the city confident Funko will remain rooted here.

FILE - In this Dec. 17, 2019, file photo, Amazon packages move along a conveyor at an Amazon warehouse facility in Goodyear, Ariz. Amazon’s pandemic boom isn’t showing signs of slowing down. The company said Thursday, April 29, 2021, that its first-quarter profit more than tripled from a year ago, fueled by the growth of online shopping. It also posted revenue of more than $100 billion, the second quarter in row that the company has passed that milestone. (AP Photo/Ross D. Franklin, File)
‘Sold by Amazon’ program ends following state investigation

Washington’s attorney general found the program was anticompetitive and violated antitrust laws.

Meat dishes color icons set. Steak, beef ribs, chicken legs, burger. Fast food. Butcher shop product. Restaurant, grill bar, steakhouse menu. Isolated vector illustrations
Best place to go for BBQ in Snohomish County

You voted, we tallied, here are the results.

2021 survey results from the State Broadband Survey for Snohomish County. (Washington State Department of Commerce)
$16M grant to speed up broadband to north Snohomish County

In Darrington and elsewhere, rural residents have struggled to work remotely during the pandemic. A new project aims to help.

FILE - In this March 31, 2017, file photo, Boeing employees stand near the new Boeing 787-10 Dreamliner at the company's facility in South Carolina after conducting its first test flight at Charleston International Airport in North Charleston, S.C.  The International Association of Machinist says six of its earliest and most vocal members have been fired at Boeing’s South Carolina plant, months after some employees at the sprawling North Charleston campus voted to join the union.  The Machinists tell The Associated Press that half a dozen employees were terminated from the North Charleston production facilities earlier in 2018. (AP Photo/Mic Smith, File)
Boeing posts $4 billion loss tied to problems with 787 jet

Manufacturing problems with the Dreamliner will add $2 billion to the company’s production costs.

An Alaska Airlines Embraer 175 airplane bound for Portland, Ore., takes off Monday, March 4, 2019, at Paine Field in Everett, Wash. The flight was the first flight on the inaugural day for commercial passenger flights from the airport. Alaska Airlines began scheduled flights Monday, and United Airlines will begin commercial flights on March 31, 2019. (AP Photo/Ted S. Warren)
5G-related airline cancellations arrive at Paine Field

One type of plane serving Everett is subject to restrictions due to feared cellular phone interference with navigation.

Funko warehouse in Everett. (Kevin Clark / The Herald)
Funko to close Everett warehouses, shift work to Arizona

The company headquarters are currently in downtown Everett, but distribution will move to a Phoenix suburb.

FILE - Washington Attorney General Bob Ferguson talks to reporters, Monday, Aug. 26, 2019, during a news conference in Seattle. In a 5-4 decision Thursday, Jan. 20, 2022, the Washington Supreme Court upheld an $18 million campaign finance penalty against the Consumer Brands Association, formerly known as the Grocery Manufacturers Association. Ferguson sued the group in 2013, alleging that it spent $11 million to oppose a ballot initiative without registering as a political committee or disclosing the source of the money. (AP Photo/Ted S. Warren)
Washington justices uphold $18M fine in GMO-labeling case

Big grocers funneled dark money into a campaign against genetically modified labels on food packaging.

Most Read