Boeing Co. will set plans this week to consolidate 787 Dreamliner assembly in South Carolina, people familiar with the matter said, ending production of that airliner in Washington state as the coronavirus pandemic weakens demand. of planes.
The decision has significant implications for the Seattle area economy and for Boeing̵
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Boeing said in July that it was investigating options to handle a slowdown in demand for the 787 that led to it reducing production. A Boeing spokesperson declined to comment late Tuesday on the study’s findings.
Earlier this year, Boeing said it would cut passenger aircraft production and cut its workforce by about 10 percent. As the pandemic has worsened in the United States and demand for air travel has remained deeply depressed, Boeing said it is weighing in cuts beyond the 19,000 already anticipated.
Boeing has assembled the 787 Dreamliner in Everett, Wash. Since the first of the famous widebodies rolled off the line there over a decade ago. He announced plans in 2009 for a second line in North Charleston, S.C., a right-to-work state where efforts to unionize the workforce have been unsuccessful.
Earlier this year, manufacturing problems at the South Carolina plant led to a broader review of quality control gaps by US aviation regulators. It is unclear whether production issues played a role in Boeing’s study of whether to consolidate Dreamliner production.
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The consolidation of Dreamliner manufacturing in South Carolina will mark another step in moving the US aerospace industry from the southern states to the west coast. Companies have already lost thousands of jobs in California, while states like Carolina, Florida, and Alabama have attracted aerospace companies with less clogged infrastructure and cheaper, non-unionized labor, including an Airbus SE assembly plant in Mobile, Ala.
Boeing employs more than 7,000 workers in North Charleston, where it also has an engine research facility. This compares with nearly 70,000 employees in Washington, including about 30,000 at the expansive Everett facility.
The Everett plant, where Boeing also produces 767s and 747s, was producing around 15 widebody jets per month at its peak, which would drop to around six and drop further with the 747 schedule ending in 2022 and production of the new 777X reduced as Boeing delayed the first deliveries until 2022.
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After increasing production of the Dreamliner last year to 14 per month, split equally between Everett and South Carolina, Boeing has reduced production to 10 and plans to do six per month next year.
With the narrow-body 737 MAX grounded for over a year by two fatalities, the construction and sale of multiple 787s was critical to Boeing’s financial recovery. The company has orders for 526 aircraft and has delivered nearly 1,000.
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The twin-engine plane has overcome years of delays and cost overruns to become a bestseller and is expected to surpass Boeing’s 777 and Airbus A330 as the most popular wide body jet by 2023, according to analysts at Jefferies. Airlines are retiring the older 777s and A330s in favor of the smaller 787 and Airbus A350.
Boeing had bet on a brisk replacement cycle for older jets to boost 787 sales, only to slow economic growth and then the pandemic to derail its plans. He also shelved plans for a new medium-sized aircraft.
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