Boeing’s South Carolina 787 Production Goes Forward
Boeing may have a green light for the South Carolina 787 Dreamliner production line thanks to a new four year contract extension with the International Association of Machinists & Aerospace Workers (IAM). The tentative agreement guarantees the building of the 737 MAX in Renton, Washington, a strong commitment to the Puget Sound region, and a $5000 sign-on bonus, just in time for Christmas.
The Boeing South Carolina 787 Dreamliner plant has been tied up in legal controversy with the IAM and National Labor Relations Board (NLRB). At the center, a legal complaint by the NLRB which accused Boeing of illegally retaliating against union workers for past strikes by creating a non-union assembly line for the 787 in South Carolina. The controversy has gone political, with many Republicans upset over what they consider union thuggery and abuse of the NLRB by the Obama Administration.
While ratification of the new agreement doesn’t guarantee the complaint being dropped, its a likely outcome. Union officials stated the contract and promise to build the 737 MAX line in Renton resolves all union grievances. The machinists existing contract, which covers members in Washington, Oregon, and Kansas, does not expire until September 2012. The union is suggesting ratification of the early extension.
The 737 MAX is a re-engined, fuel efficient build of the market leading, single aisle 737 aircraft line. The decision to re-engine the 737 vs a new, clean build was announced this past August. Since the announcement, Boeing conducted a review of potential sites for 737 Max production.
Boeing has assessed the business case for locating production of the 737 MAX in Renton in light of the economics of a proposed new labor agreement, and the company is prepared to locate 737 MAX production in Renton provided the economics contained in that proposal are achieved.
Upon ratification of such an agreement by hourly union employees, Boeing says it will make the necessary investment to produce Next-Generation 737s and 737 MAXs in its existing Renton facility.
“The 737 MAX builds upon the legacy of the world’s best single-aisle airplane and continues to generate overwhelming response from our customers,” said Jim Albaugh, president and chief executive officer, Boeing Commercial Airplanes. “If our employees ratify a new agreement, building the 737 MAX in Renton will secure a long and prosperous future there, as well as at other sites in the Puget Sound area and in Portland, Ore., where 737 parts are built.”
To date, Boeing has received more than 700 commitments from our customers for the 737 MAX. The new airplane is expected to enter service in 2017.
Regardless of decision, the South Carolina 787 build is moving ahead. Boeing just opened a new Interiors Fabrication facility in North Charleston. The facility includes state-of-the-art manufacturing equipment, and employees will use the latest Lean processes and tools to efficiently produce interior components to match 787 production rates at Boeing South Carolina.
The 787 program is several years behind, but the second line in South Carolina will allow Boeing to ramp up production in 2012.