Punching through the hysteria about closing Boeing Wichita

Mike Mecham of Aviation Week has a thorough analysis of what’s behind the decision to close Boeing Wichita.

Contrast Mike’s story with this ridiculous analysis. It’s very, very rare that we call out someone else but this one is so far off the wall that we can’t help ourselves. (It should be noted Loren Thompson was paid by Boeing to do a report about the Airbus subsidies and the tanker competition.)

George Talbot of The Mobile Press-Register weighed in with this story.

28 comments on “Punching through the hysteria about closing Boeing Wichita

  1. If I remember well LT from the Lexington institute did a memorable U-turn wrt the tanker program to embrass the Boeing vision.

  2. Closing BDS at Wichita is a business decision, nothing more, nothing less. When the F-15 and F/A-18 programs finally wind down in the next 10 years, or so, then it will be St. Louis’s turn in the barrow for a possible closure. Boeing will close the Long Beach plant at the end of the C-17 run in a few years, but no body is complaining about that. During my USAF career, I put several KC-135s into Wichita, or picked them up after mods or PDM work. They did the underwing reskin on the KC-135 there, as well as most of the KC-135E and KC-135R mods from the KC-135A. The people there do great work. But at some time in life it comes time to move on, for BDS that time is now.

  3. the av week . . . Speea’s records offers some insights; the average age of its engineering and technical worker membership in Wichita is just under 50, and they have held their jobs for nearly 21 years. The average salary of $100,015 shows why their jobs are so valued. U.S. Census data pegs the average Wichita household income at $46,559. . .

    While overall, the story is fair. the 100K average figure for SPEEA in the area is in error. 1) SPEEA dues are based on 85 percent of average hourly wage for profs and techs combined in seattle and wichita and . . .

    At 37.38 dues = approx 91,000 average wage.

    Wichita wages are in the lower percentage compared to seattle- suggest that SPEEA be given the opportunity to correct.

    2) The high wage bit raises of course the unspoken reason that by going to texas or oklahoma costs will be lower. – but forgoes the simple solution of ” selling off” a lot of the unused hangar space and keeping intact the basic tools and facilities and experience in the area.

    3) IMHO – the Boeing move will seriously bite them in the posterior- its NOT nice to P888 off those who went out on a limb . . .

    4) Boeing – and Mickey D at Oklahoma have a sorry record going back to the days of the f-15 program with a like story. promise to keep facility IF they get the Job- then pull up stakes

    McD and Boeing both lost lawsuits in the area for hosing employees. Matter of fact- John McDonnel got hammered by the judge who referred to the St louis deal in court for having a “corporate culture of mendacity “

    • Abandoning all that accumulated knowledge can’t be in Boeing’s best interest, although it may be in the best interest of short-term thinking in Chicago. Don, your last line is the most telling. That corporate culture now pervades the upper levels of the Boeing Company.

      • I’ll be a bit more specific – here is an old news article I submitted as part of my shareholder proposal many years ago – Boeig claimed it was NOT their issue since it happened before McD ” bought” Boeig and thus I had to remove it ;_PPP

        September 6, 2001

        Judge Hands Boeing Defeat in Lawsuit
        Brought Over Loss of Retiree Benefits

        By J. LYNN LUNSFORD and ELLEN SCHULTZ
        Staff Reporters of THE WALL STREET JOURNAL

        A U.S. District Court Judge in Tulsa, Okla.,
        handed Boeing Co. a surprising defeat Wednesday in a class-action lawsuit filed in
        1994 by more than 1,000 older McDonnell
        Douglas Corp. workers.

        The workers alleged that the company closed
        their plant in order to avoid paying pension,
        health and retiree medical benefits.

        Judge Sven Erik Holmes issued a 90-page
        opinion that found among other things, the
        company “engaged in a course of obstruction,
        inconsistent representations and outright
        falsehoods” during the course of the lawsuit to
        keep the truth from coming out about the 1993
        closure of a McDonnell Douglas plant in Tulsa.

        +++
        The case order is known as James R Millsap et al v Mc
        Donnell Douglas corp filed dec 2001

        AS to current culture- John is still a member of Boeing Bored . . .
        I’ll try to dig up a few exact quotes- but bottom line is nothing new – nothing changed – replace f-15 with tanker- and reprint the

  4. As I understand it, Boeing is offering to move some employees to other Boeing locations. Is that not true? If it is true, and the employees does not want to move, then won’t he be offered retirement or a severage package?

  5. more on the KORPORATE KULTURE . .

    231. The fact finder’s disbelief of the reasons put forward by a defendant “may be quite persuasive” of intentional discrimination “particularly if disbelief is accompanied by a suspicion of mendacity.”[cite ] {cite] – . Here, Defendant’s mendacity is manifest Specifically, as identified in the Findings of Fact, MDC’S mendacity is established by the untruthful and misleading answers provided to Plaintiffs under oath in its discovery responses, its depositions and in its trial testimony.

    232. The record further reflects a corporate culture of mendacity, as evidenced by the testimony of plant manager Mr. Bittle and the disregard for the truth evidenced by the testimony of CEO John McDonnell. As the Court observed during the trial:

    We have sat here for two weeks and listened to testimony that I think at some places is almost knee buckling in the way in which it evidences an abject disregard for people’s representations, people’s representations to their employees, their teammates, people’s representations to the public, people’s representations to public officials. We have other kinds of testimony: Mr. Bittle himself indicating he believed himself to be an unwitting instrument of fraud on the employees and the public; I think that the notion of engaging in negotiations that are known to not to mean to go to anything; and the ultimate question of closing a plant, recognizing the broad latitude the company has under the law, it’s entirely appropriate to review the numbers as long as improper numbers are not considered; but to hear testimony that there was never even consideration as to whether there were commitments, express or implied, to employees, to the public, to public officials.

    Tr, 1243.

    233. The Court finds that the testimony of Defendant’s key witness at trial on the reasons for the Tulsa plant closing, Project M Team leader Peter Juliano, was clearly untrue, not . . . . . .

    Those who do not learn from History – do not learn from History !!

    • Sort of a backwards posting – but see if this sounds familiar – again OCR from court docs- minor errors and typos

      14. MDC indicated that a substantial number of these “preserved jobs” wouId be in
      Tulsa. Tulsa plant manager Don Bittle testified:
      In early ‘92 the company decided to have a series of U.S. Jobs Rally Now, of
      which Tulsa participated in, I believe it was May of ‘92. We invited, and they did
      attend, not only the local politicians but the national politicians, including the
      Governor of Oklahoma, all met with us and we had a rally out at Air Force Plant 3
      extolling the need to have this sale made to continue jobs here at Tulsa. We also
      had Warren Beaver [Owen Bieber] who was the national leader of the UAW was
      here, also extolling that position, that that sale needed to go through to preserve
      the jobs at not only at St. Louis, but at Tulsa for the parts we were building.

      ====
      16. Named Plaintiffs James Millsap, Fred Davis and Vera Lehman were employees
      with many years of service at MDC’s Tulsa facility until the plant closed. Prior to the facility
      closing, they recalled being told on multiple occasions that if the company was awarded the F-15
      contract with the Saudi government, the plant would be open for at least three more years. They
      were asked by the company to write letters and to sign cards, not only to their Congressmen but
      also to the President.
      17. In response to these requests by MDC, the union and the company’s employees
      lobbied the Oklahoma political delegation with letters and calls. The promise of at least three
      more years of work was made not only to MDC employees, but also at the job rally at which the
      President of the United States and several members of the Oklahoma congressional delegation
      were present. These promises were repeated on other occasions by the President of McDowell
      Douglas Aerospace, John Capellupo, and the former general manager of the plant, Al Briggs, his
      successor, Don Bittle, and the plant director, Joe White. In addition, members of the Oklahoma
      political delegation were heard repeating the same promise to employees during their various
      visits to the plant.
      ===
      Note above – MDC execs made the promise in front of the president of the U.S. George Bush !! – and as will be shown later, they lied, lied, lied….BTW look up the background of a BA BOD member named Ken Duberstein, who probably has some reason to dislike John . . . .
      ===
      18. On September 11, 1992, President Bush amiounced at a McDomrell Douglas job
      rally held in St. Louis that he had approved the $9 billion sale of the 72 F-15’s to the Saudi
      government. This message was broadcast to employees and the public at the Tulsa plant, where
      a similar rally was underway.
      ====
      The Tulsa World reported the company’s representation on September 12, 1992:
      McDonnell Douglas said the sale will extend production of the F- 15 for at least
      three years and preserve 7,000 jobs in Tulsa and St. Louis.
      Pltfs. Tr. Ex. 42 p. 1.
      20. Such representations continued even after the Congressional disapproval period
      had expired. The company continued to feature its political campaign in its literature. It used a
      picture of members of its workforce standing under an American flag for the front and back
      cover of its 1992 Annual Report. This Annual Report contained a description of the event as:
      “Teammates celebrate announcement of an overseas sale, which will extend F-l 5 production for
      several years.” Pltfs. Tr. Ex. 50,

      ===
      24. The Project M team began actively studying the Tulsa plant as a candidate for
      closure by August 1993.
      25. The Project M team was also charged with determining, if necessary, how to
      transition the MDC Tulsa work to another MDC facility.

      +++

      GOLLY – WOW – IMAGINE THAT !!!!!

    • Don, I may have missed something since I don’t live in Wichita, but did Boeing say somewhere that they were not going to pay retiree benefits? I thought I heard that they were looking into transfers to other Boeing facilities and providing benefits that normally accompany plant closings.

      • BOEING would never say that- but neither did McD. If one is vested in the Boeing Pension Plan ( they have about a half dozen depending ) and vesting takes 1 to 5 years, then those benefits are guaranteed. as to medical – it depends- generally unless part of a contract, they may be changed or dumped.

        As to retirement- many but not all BA plans give full retirement at age 60. And usually allow ‘early’ retirement at age 55, albeit with significant reductions. If you look at my following post(s) re the McDummy games, you will see just the type of games that can be played. All of the above being said, Boeing is about in the middle of the pack re major hosing of employees, and Minor hosing. IN all cases, dealing with BA trust but verify – in writing to the Plan administrator. If a boeing employee – use total access ( sometimes called INaccess by those who must deal with them ).

        As to how to hose employees for fun and profit( in pension plans ) – I suggest getting a copy of ” retirement heist ” by ellen schultz. It is true, correct, accurate description of corporate games in pension plans. Check some of my comments on the book at Amazon to the jerk who totally trashed the book with unsupportable statements -

  6. Don :
    As to how to hose employees for fun and profit( in pension plans ) – I suggest getting a copy of ” retirement heist ” by ellen schultz. It is true, correct, accurate description of corporate games in pension plans. Check some of my comments on the book at Amazon to the jerk who totally trashed the book with unsupportable statements –

    I have read all your comments on “Just the tip of the iceberg”. You now have seven more “adds to the discussion” votes. :) I have also acquired and read “Turbulence”, which you had recommended to me a while ago. It is indeed a very interesting book and it is my turn to recommend it to anyone interested to know what happened to Boeing in the last decade and a half. As to “Retirement Heist”, I am not sure I really want to know what’s going on with my Pension Plan. :(

  7. Regarding mother Boeing and early retirees- this from Jan 2012 issue speea spotlite

    Case goes to court
    for decision
    SPEEA’s legal counsel filed a 93-page motion
    Dec. 9 requesting a court’s ruling in a
    class-action lawsuit against The Boeing
    Company. About 2,500 pages of supporting
    documentation accompanied the motion in the
    battle over early retiree ‘bridge’ benefits.
    Boeing must file its brief in opposition to
    SPEEA’s request by Feb. 12. The court will
    decide whether to issue a summary judgment
    or hold the case for trial.
    Boeing took away the contractually negotiated
    early retiree benefits for eligible employees when
    it sold its Wichita commercial division to Spirit
    AeroSystems in 2005.
    SPEEA filed the initial lawsuit in August 2005
    on behalf of hundreds of laid-off employees.
    Under the contract, they were eligible to retire
    at age 55 with pension and medical benefits if
    they were at least 49 with 10 years of service
    when Boeing laid them off.
    The International Association of Machinists
    (IAM) joined the lawsuit in 2006, followed by
    26 individual plaintiffs and class representatives.

    +++

    ;-PP ” how does that make you feel ? “

    • I don’t know what Lee might say. Scott says because KS politicians stuck it up Airbus’ tailpipe in the tanker competition and Alabamans didn’t. Ya sleep with your friends, not your enemies.

      • well if I had answered ‘ scott”- it would have confused many of the board denizens ;-P However, I think in this case, Airbust will sleep with anyone who gives the best deal- its just business ;) The same is true for KS . . .

  8. Airbus , Boeing, Airbus, Boeing … the real winner is probably L-3 or its ilk in competition with Spirit Aerospace for some of the choice buildings, because in 2018 when it comes time to reskin the KC-135s again. There wont be an experienced mod shop like the Boeing Wichita Modification Shop was in Boeing. I will be curious to see how many Boeing buildings, Spirit picks up the this time on the Cheap as Tornado Damaged Goods and put its toe into the business of modification.

    • There is no fleet wide reskin needed for the KC-135. Back in the 1970s and 1980s All KC/EC/RC/C-135s had the under surface of the wings reskinned, due to cracks in that area. The claim that the fleet needed to begin a reskin program around 2018 was made by former AMC Commander Gen. Art Lichte in 2008, when he was pushing for the NG/Airbus A-330MRTT. Lichte was also about to retire and was positioning himself for a post retirement job with NG. Of course the A-330 was selected in 2008, but serious problems were found by the GAO, and the SOD cancelled the contract. Lichte eventually got a job with EADS-NA for the 2010 KC-X program, but left the company soon after Boeing’s B-767 won.

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