Warbird Information Exchange

Boeing moves on in 777X site selection after union leaders reject contract
Charleston Post and Courier (SC) 12/17/2013
Author: Warren L. Wise
Copyright (c) 2013, The Post and Courier, Charleston, S.C.

Boeing said it has moved on its site selection process after Machinists union leaders rejected last week's contract offer.

Below is the statement by Ray Conner, president and CEO of Boeing Commercial Airplanes, sent to Boeing employees today:


"Over the course of the last several days, I've received hundreds of messages from members of our team with questions and comments about our meetings last week with IAM leaders and the status of the 777X site selection process. The vast majority have been thoughtful and considerate expressions of both concern and hope for the future.


With that experience in mind, I thought it would be helpful to provide the full team a few clarifying comments about the disappointing outcome of last week's talks and a quick update on the status of the 777X site selection process.


First, as we made clear in the statement we released last week, we agreed to re-engage with union leaders with the hope of reaching agreement on a contract extension that would place 777X final assembly and wing fabrication and assembly in Puget Sound. We responded to a proposal from the union with a best and final counterproposal that meaningfully improved the value delivered to IAM members over our prior offer and clarified points that some said were unclear in that earlier contract proposal. If ratified, our final proposed contract would have reinstated ZOOM, extended LOU-42 on securing 737 MAX production in Renton to 2024, improved dental coverage provisions, added an additional $5,000 lump sum in 2020, and better defined the 777X work that would be won as part of the agreement.


We were sincere in asking for the union leadership's commitment to support our improved final proposal as a tentative agreement that would be taken to a vote by IAM members with a recommendation for approval. However, that did not happen. The proposal was rejected in short order by IAM-751 leaders. Subsequently, some have asserted that we withdrew our proposal. That's not the case. We would not back away from an offer we made in good faith to our team. It was a rejection, plain and simple, and we now have to turn and face the reality of the union leadership's final decision.


Based on last week's outcome, we have now moved on to the next steps in the down select process for 777X work placement, which will be completed early next year. We received proposals from 22 states covering 54 sites. We are encouraged by the quality and magnitude of the response. Thanks to the diligent efforts of our evaluation team, this week we are narrowing that list down to a handful, from which our final decisions will be made.


Thank you for your patience and perseverance through all the attention this issue is getting in our community and in the media. We will continue to provide updates of our progress in the days and weeks ahead. Strengthening our Commercial Airplanes business for the short and long term will be guiding our decision making."

Additional information, the evening local news said that the State of Washington is talking with AIRBUS

NFW!!!!!?

No reason for Boeing to keep building anything there then if the union gets distracted by Airbus.

I remain optomistic and have endless patience.....

Washington state courts Airbus amid Boeing tension
Associated Press 12/17/2013
Author: Mike Baker
Copyright 2012. The Associated Press. All Rights Reserved.


Even as they try desperately to hang on to Boeing Co., officials in Washington state have been courting the main competitor of the aerospace giant.

During the past several months, state officials have traveled to the U.S. headquarters of Airbus SAS in Virginia, moved to connect Airbus with Washington state suppliers, and signed a five-year confidentiality agreement with the company to allow further exploration of business opportunities, according to records obtained by The Associated Press under public disclosure laws.


In a confidential memo provided to Gov. Jay Inslee in July, state officials described dozens of potential ways to expand or recruit aerospace businesses in the state. At the top of the memo was Airbus, described as just one of a few major opportunities.


One expert said for years it was generally frowned upon for Washington state officials to jeopardize the relationship with Boeing by seeking ties with Airbus. However, the steps outlined in the memo came amid tension created when Boeing moved its headquarters from Seattle to Chicago and started an assembly line in South Carolina to build its 787 passenger plane.


Now, as it looks for a cheaper place to build its 777X passenger plane, Boeing has been exploring bids from 22 states that could send thousands of good-paying jobs elsewhere. Hoping to convince Boeing to stay in Washington, state lawmakers gathered in a special session and approved an estimated $9 billion in tax breaks.


Alex Pietsch, top aerospace adviser to the governor, said the talks with Airbus are not an attempt to replace Boeing. But a new relationship with another industry player would help diversify the state's aerospace economy and provide new opportunities for suppliers that are largely dependent on Boeing, he said.


"Just because we have had a near 100-year history with the Boeing Co. doesn't mean we can't work with others," Pietsch said.


Boeing's history in the Pacific Northwest dates back more than a century, when William Boeing purchased a Seattle shipyard that would become his first airplane factory. Since then, Boeing has been a cornerstone of the region's economy. Its shifting personnel influences traffic patterns and its green aircraft fuselages can be seen traveling by train along the Seattle waterfront.


State figures show the aerospace industry employs some 130,000 people at 1,250 companies around Washington, with suppliers making components such as aircraft lavatories, flight-deck security doors and molds to shape aircraft fuselages. The state estimates 777X production would support more than 56,000 jobs.


David Williams, vice president of procurement for Airbus Americas, said there are no near-term plans for Airbus to set up shop in Washington. However, he pointed out that Washington is already the company's No. 2 state in terms of the number of suppliers, with Airbus making some $200 million in purchases a year.


He expects that amount to grow as Airbus increases its U.S. spending and makes more connections with Washington state businesses.


This past summer, the state worked with the Pacific Northwest Aerospace Alliance to bring together aerospace suppliers and Airbus to talk about how they can expand partnerships. More than 110 suppliers attended the event — nearly triple what the alliance had anticipated.


Monica Tate, aerospace business development manager at the Washington state Department of Commerce, said a variety of suppliers already have relationships with Airbus but generally do the work on an as-needed basis.


"We were ready to take it to the next level," said Tate, who traveled to Airbus Americas headquarters in May. Pietsch also has visited the company's offices in Virginia.


Tate said it would be ideal for Airbus to establish a physical presence in Washington state, but she hopes there will be exponential growth in Airbus-related business in the state regardless.


Scott Hamilton, an aviation analyst based in Issaquah, said the past attitude discouraging dealings with Airbus was due to neglect and complacency on the part of political leaders who were satisfied with Boeing's presence.


That has changed. As Boeing began developing the 787 line in South Carolina, Hamilton said state leaders needed to diversify Washington's aerospace industry. The meeting this summer between Airbus and suppliers was a positive sign, he said, and there are indications that Boeing is fine with the relationship since it would maintain a robust base of suppliers.


Hamilton also said it would make sense for Airbus to scoop up some of the engineering talent that Boeing has laid off in the region and develop an engineering presence in the state.


Williams, the Airbus Americas vice president, said it's clear the state has a huge depth of expertise to supply the airline industry.


Airbus expects a certain level of "home team" allegiance between Washington state and Boeing, Williams said, but there's a realization on all sides that the airline industry is now global with two major players — Boeing and Airbus.


"To shut the door to either one of those, you're reducing your opportunities by half," Williams said.

Personally I think this will end up in Seattle, but I'm still hoping it might be able to keep Long Beach alive (if that wasn't already obvious).