States vie for Boeing jobs, after Machinists vote down contract extension

November 26, 2013

Members of Boeing’s Machinists union demonstrate in Seattle on Nov. 18, 2013 (Photo: REUTERS/Jason Redmond)

Boeing, the commercial airline manufacturer that has called the Puget Sound region home for a century, barely waited for a vote by its Machinists union to become official before it called Utah Gov. Gary Herbert (R) about leaving.

Herbert was among several governors to get calls from Boeing executives eager to scout new locations for production of its long-haul 777X aircraft after the Machinists voted down a proposed contract extension. If Washington State union members didn’t like the contract Boeing was offering, the company wanted to make clear it would take its business elsewhere.

“I think the first phone call that Boeing made was to Utah. We didn’t call them. They called us,” Herbert said in an interview. “We adjusted our schedule to accommodate them.”

The union’s vote, just days after Washington legislators passed the largest corporate tax break in the nation’s history in order to keep tens of thousands of jobs in the state, came despite Boeing’s warnings that failure to pass the contract would force the company to look elsewhere. The aerospace giant has been slowly divesting itself from Washington in recent years, first moving its corporate headquarters to Chicago, then opening a major construction facility in North Charleston, S.C. Earlier this year, Boeing said it would move several hundred engineering jobs to Long Beach, Calif.

The lines that produce the 777X could be next. Even before the union vote took place, top officials in states like South Carolina and California were lobbying to host the new long-haul aircraft.

“We stay in good contact with Boeing, because they obviously are a great corporate friend to South Carolina,” Gov. Nikki Haley (R) said in an interview. “We were in touch prior [to the vote], as it was happening.”

Doug Adler Jr., a Boeing spokesman, said in an e-mail that the company had begun a formal site-selection process by inviting a dozen locations to submit proposals for parts, assembly and painting facilities for the 777X, and for the new composite wing. Proposals are due by mid-December, Adler said, though he declined to name the sites.

South Carolina may be Washington State’s biggest threat in the contest for Boeing jobs. The company recently bought 500 acres of land near its North Charleston facility and committed $1.2 billion in additional dollars. Utah, another strong contender, already has an 800,000-square foot Boeing facility up and operating.

In California, the “governor’s office of business and economic development maintains a strong relationship with Boeing and we are actively working to expand all facets of their operations in California,” said Brook Taylor, a spokesman for the office.

“There’s some sense of urgency. This is not something they want to drag out for a long period of time,” Utah’s Herbert said.

Washington State isn’t going to let the Boeing jobs go without a fight. The state will respond to Boeing’s request for proposal, said David Postman, a spokesman for Gov. Jay Inslee (D); the tax break and other legislative incentives will give it a leg up, despite the new, longer odds of a nationwide competition.

“The governor also is asking Boeing and the IAM to return to the table and renew talks about a contract. He’s done that in private conversations with both sides and has more conversations planned in the coming days,” Postman said.

Aerospace is still a major part of Washington’s economy. The 777 program alone supported 56,000 jobs in the Puget Sound area last year, Inslee’s office said; Boeing and its associated industries generated $76 billion in economic activity in Washington.

Reid Wilson covers national politics and Congress for The Washington Post. He is the author of Read In, The Post’s morning tip sheet on politics.
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