Saving Everett’s 787 line ‘worth a try,’ but it’s a heavy lift

EVERETT — A Snohomish County task force, formed in 2017 to persuade the Boeing Co. to build its next airplane model here, reconvened last week in hopes of convincing the company to keep an existing assembly line at the plant at Paine Field.

The Chicago-based airplane maker last month said it would evaluate whether to consolidate production of the twin-aisle 787 in one location. The coronavirus pandemic has sickened the travel industry, and Boeing foresees little need for two 787 assembly lines since the bottom dropped out of the commercial airplane business.

Under the circumstances, making a case for keeping Everett’s 787 line will be a challenge.

Production of 787s is now split between Boeing’s Everett campus and the company’s assembly plant in North Charleston, South Carolina — the only Boeing location outside Washington where the company builds finished commercial airplanes. Only 787s are assembled there.

The Everett plant and the North Charleston plant share production of two of three 787 sizes — the 787-8 and the 787-9.

But the “stretch” version, the 787-10, which is 18 feet longer than the -9, is built only at the North Charleston facility, where fuselages for all 787s are fabricated.

Fuselages for the -8 and -9 models are delivered to the Everett plant via Dreamlifter airplanes — specially enlarged 747s. But the -10 fuselage is too long to fit inside a Dreamlifter. So that model is fully assembled only in South Carolina.

Those extra feet and other factors, including South Carolina’s lower production costs, could put Everett’s 787 line and thousands of aerospace jobs on the chopping block. The company would continue to build the 777, 767 and KC-46 tanker in Everett, but the 747 is to be discontinued.

Demand for twin-aisle, widebody airplanes like the 787 had declined even before the COVID-19 pandemic. But with airlines struggling to survive the economic downturn and travel bans, new airplane orders — widebodies in particular — have completely evaporated.

Boeing sold no airliners last month. The aircraft maker said in a recent news release that it would reduce production rates for some models in 2021, including the 777, the new 777X and the 787.

So production of the 787 will be reduced from the current rate of 10 per month to six per month in 2021, the company said.

That low output could be handled by the North Charleston plant alone. It can produce up to about seven aircraft a month.

The Snohomish County Aerospace Task Force, whose members include County Executive Dave Somers and Everett Mayor Cassie Franklin, met last week to begin crafting a plan to convince Boeing to keep 787 production here.

The task force is recommending a positive, show-Boeing-the-love approach.

”We want to let Boeing know we want to be as supportive as possible and make the case that Snohomish County very much appreciates Boeing and the aerospace sector,” Somers said in an interview.

Somers created the task force in late 2017 in hopes of securing the design and production of Boeing’s anticipated new mid-size airplane. But plans for the midsize model have been scrapped, replaced by talk of a future small airplane, most likely single-aisle and a 737 replacement.

Consolidating production of the 787 to one location has always been in the cards, but only if demand dried up.

Richard Safran, an investment analyst with Buckingham Research Group, predicted in 2017 that weak demand for the 787 could cause Boeing “to consolidate one production line — likely (North) Charleston.”

Industry analysts, including Scott Hamilton on Bainbridge Island, have continued to note that it’s cheaper to produce 787s in South Carolina, where the cost of labor and regulatory compliance is less.

What can the task force or others do to sway the decision?

For John Monroe, a retired Boeing executive and a task force advisor, it may come down to showing Boeing the love.

What else is there?

Hefty state tax incentives, the largest of which saved Boeing hundreds of millions of dollars since 2003, were eliminated by the state this spring at the company’s request.

Earlier this year, Boeing asked state lawmakers to roll back a preferential business-and-occupation tax rate which the World Trade Organization targeted as an illegal trade subsidy. They complied. The generous tax breaks dropped off the books April 1.

“We no longer have incentives for them,” Monroe said.

“We just have to show them the love — show them we want them here. Remind them that this is a great community with a tremendous skill base and facilities,” said Monroe.

How do you do that?

A campaign could include letter writing, op-eds, a webpage and Facebook and Twitter activity, he said.

Monroe predicts that demand for the 787 will “come back faster than the 777,” he said.

Rather than shutting down the Everett 787 line and “emptying out the buildings, they could just mothball the program,” he said. “I would rather it be suspended than completely wiped out.”

“You can’t really mothball South Carolina operations because the plant is also a factory that produces the aft sections of the fuselage,” Monroe said.

Somers also advocates a soft touch. “Whatever kind of campaign it is, it needs to be a positive one,” he said.

The decision — cut, close or keep production at both sites — isn’t likely to be handed down for several months, said Somers, who referenced a recent conversation with Bill McSherry, a vice president in Boeing’s commercial airplane division.

“He said it will require a couple months of studies — and involve the unions in those discussions,” Somers said. “That rings true to me.”

In the meantime, said Somers,“we have to do our work to be supportive of the industry. We will continue to work on workforce development and improvement.”

Trying to influence Boeing is “certainly worth a try,” said Richard Aboulafia, a prominent aerospace analyst and vice president of the Teal Group of Fairfax, Virginia.

“But all of the arguments in favor of keeping Everett are long-term arguments, and Boeing right now is taking an extremely short-term focus,” Aboulafia cautioned.

Janice Podsada; jpodsada@heraldnet.com; 425-339-3097; Twitter: JanicePods