December 1, 2011 in Business

Renton chosen for new 737 aircraft production

Boeing, Machinists deal good news for state
By The Spokesman-Review
 
700 commitments

So far Boeing has lined up roughly 700 commitments for the more fuel-efficient 737 MAX from several airlines. Boeing has been conducting a review of potential sites for 737 MAX production since the company announced in August it would build a new-engine variant of the market-leading 737.

Ending months of speculation, Boeing on Wednesday announced it will base future production of the new 737 MAX aircraft in Renton, Wash.

State and area officials have worked months to persuade the company to keep production of the plane in Renton, where Boeing already completes final assembly of the current 737 airliner.

Spokane officials said they are delighted with the announcement and intend to get a piece of the action, including possibly landing a second production line for the new jet, expected to go into service in 2017.

Boeing said a deal between the company and the Machinists union was struck to ensure the aircraft is built in Renton, considered the top contender for the manufacturing work. Spokane never presented itself as a candidate for the main production facility, but officials here said the area has advantages that could streamline 737 MAX production.

Citing the area’s available land, workforce skills and infrastructure as assets to help Boeing meet 737 demand, a coalition of area groups, including the Community Colleges of Spokane, the City of Spokane, Spokane County, Greater Spokane Inc. and Spokane International Airport, plan to submit a proposal to Boeing next year, said Larry Krauter, the airport executive director.

That proposal has two targets, he said: to recruit Boeing to add a secondary production site in Spokane if it needs more capacity than Renton provides; and to recruit one or more suppliers of equipment and components for the 737 MAX.

If nothing else, Boeing might consider using a Spokane site as a secondary drop-off site for component assembly before the aircraft are hauled to Renton for final assembly, said Krauter.

Washington Gov. Chris Gregoire is seeking close to $10 million from the Legislature to enhance Washington’s aerospace industry. Most of that is for job training, education, and transportation.

The aircraft industry accounts for at least 89,000 direct jobs in Washington, with many production salaries ranging from $81,000 to $91,000 per year, according to Tayloe Washburn, the governor’s senior adviser on aerospace development.

Greater Spokane Inc. President Rich Hadley said it made obvious sense for the Spokane coalition to underline the more than 80 aerospace-related companies in this area that are tied in some way to airplane manufacturing.

Hadley said Boeing may very well look seriously at a second production site in the state if it discovers Renton can’t make as many 737s as its orders require. Statements by Boeing union members indicate they plan to produce about 42 of the 737 MAX aircraft per month in Renton.

“If that number goes to around 60, Boeing may well consider a second production site,” he said. At the least, Spokane can target a “tier-one” parts supplier for Boeing to consider relocating to Spokane, Hadley added.

Krauter said Spokane’s airport has extensive land and untapped transportation resources for expanded aerospace production. He said sites on the west and south ends of the airport have been designated as locations for possible expansion and recruitment.

Gregoire hailed the contract agreement as good for the state, the company and the Machinists.

“If you can do it in the current configuration, great,” Gregoire said. If not, the state had other locations Boeing should consider. “For me, Spokane always was an option … if the footprint in Renton wasn’t sufficient.”

The state also has some 650 aerospace manufacturers, including some in Spokane that will benefit from the expansion in Renton, she said. “This is a good day for all of those suppliers in Spokane.”

Staff writer Jim Camden contributed to this story.

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