November 16, 2013 in Business

Boeing hunting new sites for 777X after machinists’ ‘No’ vote

Dominic Gates Seattle Times
 

The day after machinists emphatically rejected a Boeing contract offer that would have secured the 777X for Washington state, company officials flew out to begin assessing possible alternative locations.

“It’s not just a conversation by phone,” said a person close to the company. “People are in the field today, in face-to-face meetings.”

Despite Wednesday’s machinist vote, he said, Boeing has not written off Washington state as a potential site for 777X. “No door is being closed.”

That confirms what Gov. Jay Inslee heard Wednesday from Boeing senior vice president of government operations Tim Keating.

Inslee said late Wednesday that when he called Keating immediately after the machinist vote result was announced, “I said: ‘Are we in contention?’ and the answer came back unequivocally, ‘Yes.’ ”

Meanwhile, discussions have now begun elsewhere.

Michael Sullivan, a spokesman for Utah Gov. Gary Herbert’s Office of Economic Development, said Herbert received a call Thursday afternoon and has begun preliminary discussions with Boeing leaders, AP reported.

Salt Lake City was one of three cities named earlier this week by two sources close to the company as potential alternative 777X locations identified in an analysis by Boeing.

In a nonunion facility there, Boeing makes the 787 Dreamliner’s horizontal stabilizer, made from carbon-fiber-reinforced plastic composites.

However, Salt Lake is landlocked. At present, Boeing transports the 777’s huge fuselage panels by sea from Japan to Everett. Figuring out alternative logistics to Salt Lake would be expensive.

Huntsville, Ala., which has an extensive space rocket industry and was also identified in the Boeing analysis, has the same problem.

That makes Long Beach, Calif., the most likely of the three sites named internally as initial targets.

As a West Coast port, it offers a similar supply route for the fuselage panels as Everett.

The 5,000-strong Boeing workforce in Long Beach has long experience building airplanes.

And the United Auto Workers (UAW) union that represents the workforce will likely accept the terms of any Boeing contract that offers life beyond 2015.

As for Boeing’s South Carolina assembly site, it’s struggling to produce 787s at the rate planned, and according to multiple sources is still rife with quality problems.

Because the 777 is currently made on a very efficient assembly line in Everett at a high production rate of 100 jets per year, deciding to make the new 777X model anywhere else but Everett means introducing a new workforce and adding some risk to the program.

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