IAM warns members: Boeing is coming for concessions on 787 consolidation study

Aug. 22, 2020, © Leeham News: The president of Boeing’s touch labor union, IAM 751, is warning members that the company study about potentially consolidating 787 production in Charleston could lead to a request for new concessions from the union.

IN a post yesterday on the union’s website, John Holden said a request from Boeing hasn’t happened yet—”however, it is something that we need to expect and prepare for, and we believe that we may be facing that threat soon.”

IAM in the dark

“We have been made aware through conversations with elected officials, and notified by the media, that Boeing indicated they want to talk to the IAM about ‘further flexibilities and efficiencies’ they want from the IAM as the Company evaluates its study to consolidate 787 final assembly at one site,” Holden wrote.

Aside from being notified that there is a study, there have not been any discussions on this topic between Boeing and the IAM,” Holden wrote in bold face in his message. “In typical Boeing fashion, they are talking to everyone else but the Union. It is what they do in these situations. They are attempting to align the politicians and the media in order to exert maximum pressure.”

The contract with Boeing extends to 2024. It was widely expected, before COVID, that Boeing would seek to open contract negotiations well in advance. This is the pattern since 2009, with the IAM and the engineers’ union, SPEEA. The SPEEA contract also extends to 2024.

In December, 751 created a strike fund in anticipation of the 2024 contract expiration.

“Now, they are threatening our members and the communities we live in once again with the 787 production being completely removed from Washington State,” Holden wrote.

The full message may be found here.

24 Comments on “IAM warns members: Boeing is coming for concessions on 787 consolidation study

  1. When stories first surfaced that Boeing might consolidate 787 Dreamliner production to Charleston, it was apparent that reports of the fight for jobs would soon follow. It kind of makes one wonder if nothing has changed at Boeing even after the the tanker problems, the 737 Max problems followed by the release of a CEO and major changes on the board of directors. One would think the company would want the best qualified most experienced people building the planes? Isn’t it a known fact that the 787s built in Washington State have fewer problems than the ones assembled in Charleston? I wonder what Airbus would do.

    • They have 32 undelivered 787 and want to cut the production rate. If they have a contract with the union till 2024 wouldn’t they need to follow it?

      This is the time to improve quality with low production which isn’t cheap, when all the airlines know that quality is low. It will take years to get a better quality reputation, but does Boeing really want that.
      The only good thing they have is, there are many greedy airlines who don’t care about quality if it’s cheap, see Enter.

      If Airbus can produce 2 A330 per month, why can’t Charleston produce at 2 per month too, or 3. Sure it’s not efficient, but if there is a contract till 2024.

      • Its a weird situation because there is no answer because of how screwed up Boeing management has done the 787 program

        Keeping in mind, if you remove 787 from Everett, all the overhead for that huge building falls all on what will be a couple 777 a month (old and new?) and all of 5 x 767 a month. 747 is gone in 2022.

        I believe Charleston can do 10 a month, so its been underutilized.

        It also was never intended to assembly 787 there until the management move to gut the unions.

        Until they can the management, Boeing quality will never improve no matter how slow the production. They lay people off at any hint of perceived (but fake) savings.

        That is what happened in Charleston, they had a 3 month hiatus between when the -10 came on line, and they laid off all the contract outside workers.

        The whole thing at Charleston quality wise went into the Toilet because those contra workers were the ones who had the quality build process down.

        As I found out workign for two huge corporations, its all about how you can transfer the costs from your part of the ops to someone else’s group.

        My expression for that is Teamwork is (this is the polite version) The Heck with You and Hooray for Me.

        Or management screws up and passes the costs onto the rest of us.

      • Horse output!

        Airlines live on reliability thus quality of design and fabrication.

        What Boeing and the IAM should do is collaborate to improve production efficiency.

        They did it in Everett to get more room to build the 767 bases for the KC-46 program, perhaps did it in Renton years ago at least once (IIRC a lady and the guy who took over running Continental Airlines and improved its performance by slashing silo walls).

        Leadership is key, autocratic sneakies as in Boeing management and Marxist violence-inferers like the IAM (check the fire outside its HQ south of Boeing’s Everett plant and SPEEA’s showing of a video about the tyrant who ruined life in Venezuela) aren’t leaders no matter what their title.

    • Its not just ‘fewer problems’ at Everett. It seems that the average time for assembly is lower as well, indicating higher productivity.

      “Charleston still is plagued with production issues leading to a shell game with 787s transiting between the final assembly building and the flightline to finish assembly tasks. Boeing is trying to maintain a build rate of 7/month and it appears that final assembly is taking longer than expected on the Charleston built 787s forcing Boeing to roll them out to the flight line before they are completed so that the line continues to move. Boeing then rolls them back into 88-30 into a two or three final assembly positions where they can be worked on depending on the amount of work that is left to be done on each 787.”
      From one of the last posts for All Things 787 in Dec 2019.
      Current slower assembly rate ‘solves’ the bringing the plane back into the assembly line issue but what confidence is there for when deliveries pick up to run the line again at maximum rate.

      Its seems to be more serious than just small problems at Charleston , wasnt a large fuselage section at ‘dropped’ while being moved by overhead crane.

  2. No big surprise. The worse things get the more they stay the same.

    Amazing managers can cost a company billions and run it into the ground but you sure can’t pay anyone good wages. Makes you want to beat your head against a brick wall to make the hurt stop.

    In a bizzare twist, Boeing has nothing to loose (or so they think). Its not like they are making money these days.

    If this was a pure business decision it would make sense. But building 787 in Charleston was never intended originally, and the business aspect of the decision to do so (costing billions to make to happen) was and continues to be insane.

    Charleston originally was produion for part of the 787 (Chance Vought fuselage) and assembling of that to fuselage piece from Italy to then be flown to Everett. Nothing more.

    Of course Boeing gave up their big tax break in Washington State. They still have lots of leverage in South Carolina.

    Clearly Boeing has huge excess capacity now (likely did for some time covered up by their burst of 14 a month x 787)

    747 production stops in a couple years, 787 moves to Charleston and Everett has a huge unused space. 777X sure is not going to take up more than it is.

    767 is low volume. Half the building empty. Now that is good management.

  3. There’s no way to build the 787-10 in Everett because the center fuselage section won’t fit in a Dreamlifter, so consolidating 787 production in Charleston is pretty much a done deal.

    What the IAM in Everett needs is to insure they get to produce the new 797 family which could and should be built in the Everett factory once the 787 and 747 lines are cleared out. I think that future program has great potential for the fine workers there 🙂

    • Perhaps B should buy some Belugas from A as I believe they are big enough to take the barrels of the 10? After all, A used super guppies for years so turn about is fair!
      The quality issue referred to above is the killer. If it ain’t fixed in Charleston – and to a lesser degree in Renton – B is toast.
      Shaky airlines may close their eyes and buy a low price, but serious operators know that in the long run cheap and shoddy is not a bargain to make.

    • ” because the center fuselage section won’t fit in a Dreamlifter”

      Thats what people say, but the centre barrel is built by Alenia/Leonardo in Italy. The rear fuselage section is built by Boeing ( formerly Vought) next door in Charleston.
      The cockpit and forward section is from Spirit in Wichita, the next small barrel section forward of the wing is from Kawasaki in Japan.
      All sections mentioned above plus wings and tail come by Dreamlifter. The only part that doesnt is the rear fuselage made in Charleston.

      • Looking more closely at the fuselage sections , It seems that Charleston joins together sections 46 ( behind wing) , 44 ( above wing centre box) from Italy and Kawasakis (forward of wing ) 43 before dispatch to next door FALs or Everett. The Spirit front section and Charleston rear section at added during the final seembly .
        I dont know why the Kawasaki section 43 cant arrive at Everett , then the Italian 43 and 46 together and then the Charleston 47 and 48 and finally the Spirit 41.
        Either way there is going to be a lot of unused space at Everett or Charleston but the ‘Italian made centre section’ is a red herring.

        • Duke, I believe the issue is that the positioning and joining tools for fuselage sections 43, 44, and 46, plus wing box 11 and wheel well 45, are installed only at Charleston. For all 787 models, these sections are delivered and assembled there.

          https://www.researchgate.net/figure/Boeings-global-supply-chain-Source-The-Boeing-Company_fig4_322270152

          Then some of the resulting combined center fuselage assemblies for the -8 and -9 are flown to Everett in the Dreamlifter for remaining production. But the -10 assemblies remain at Charleston for production, as they won’t fit on the Dreamlifter.

          https://catch4all.com/positive/2010/Boeing/747/Dreamlifter/Boeing747Dreamlifter_Route.JPG

          So the choice would be to purchase & install another set of positioning and joining tools for Everett, move all the existing tools to Everett, or shut down Everett and consolidate at Charleston. Of these, the last would be the least expensive.

          However this amounts to choosing between evils, and while lack of present demand is the driver, cost is not the only consideration, there is also loss of investment and workforce. So I hope Boeing can find a way forward to preserve both facilities.

          • Both Everett and Charleston have the automated fuselage joining tools.
            I understand the joining fore and aft to the Italian centre section only occurs at Charleston currently but its within the wit of Boeing to do so at Everett.
            I just wanted to correct the misunderstanding that any of the ‘combined centre section’ is made at Charleston.
            At one stage Boeing was flying the joined centre section to Ft Worth for exterior painting before flying it back for the final assembly line.
            In my view Boeing cant shutter most of Everett, lose its experience labour force and then ramp up again for a proposed 797, while having limited 787 production at Charleston ( which had around 5 days longer per plane in final assembly time).
            Both locations will continue 787 for now but the game of bluff for the Everett unions will continue

          • Both locations have the final assembly tools, yes, for nose, aft sections and wings. In fact Everett has two sets, with one for the surge line. But only Charleston currently has the mid-fuselage tooling.

            It was intended from the start that the mid-section assembly would occur in Charleston and then be flown to Everett for final assembly. Then Boeing bought the Global Aeronautic and Vought integration facilities, and opened a second final assembly line. That is the one that now must handle the -10.

  4. Airbus is shedding about 15,000 people: why would Boeing not do something similar? Clearly unpleasant for those affected (speaking as an airline PE who’s just been surprised by early retirement), but also an opportunity to engage with Boeing early on – even if it means actively going to them rather than waiting for them to come to the union – to get the best outcome in these “unprecendented” times.

  5. I think the issue is that Boeing needs to either increase production or reduce costs at Everett, to keep the facility open. So they are exploring all options.

    The deal with Emirates may boost 787 production, they want to switch some of the 777X orders to 787 and also they want them sooner rather than later. If they are the 9 model like Emirates already has on order, they could be produced at Everett, which would kick the can down the road a bit, toward an eventual recovery.

    Of course that weakens the business case for the 777X, so I’m sure Boeing is reluctant, as they try to justify continued development of 777X production, but it could help Everett in the short term.

    I don’t think Boeing (or at least Calhoun) wants to close either facility, so they are running all scenarios forward in the study. The union is understandably upset but it’s just the reality of the market right now.

    If I were Boeing, I’d be looking at any way to keep the workers employed and both facilities open. If Boeing takes a loss in doing so then they could ask for some concessions to keep people working. But any concessions should be temporary and reversible when the market recovers.

    At Airbus they were doing some job-sharing to maintain partial income for workers until the full positions could be restored. That’s a good and fair idea, if the union here would be receptive. But better still is to have increased production.

    • “”The deal with Emirates””

      The 30 787 from last year are scheduled for 2023. If Emirates want them earlier, where is the problem.
      The new deal should be 787-9 too.
      Not so good for 777X as expected, but if Emirates wouldn’t have ordered 777X they would order A350 now.

      • If Emirates rekindled the acquisition discussion with Etihad, they’d get 37 787s straight away and at a “bargain basement” price…

        • The real issue is Boeing management creating this situation in the first place.

          Don’t tell me they could not figure out a way to get a -10 built in Everett. They don’t want to.

          Their goal all along has been to close down ops in Washington State.

          No more than taking advantage of a situation they created int he first place.

          Keep in mind this is a shift of costs to make the 787 and Charleston look good.

          Dump the rest of the costs onto Everett and make it look bad.

          So, maybe 787 is more efficient (build quality is another matter) in Charleston, but what are the costs added to 767 and 777 production in Everett?

          Its not any given cost, its your overall cost. Playing whack a mole with the pieces is nothing more than corporate shuffle to what or where you want to penalize.

  6. Emirates just seems to be bargaining to get more camels for their buck, or avoiding to put money down now for future camels.

    2013 Announces 150 777X at Dubai airshow, another 6 as conversions of 777-300ER
    2017 Order 40 B787-10 announced but unconfirmed probably cancelled in 2019
    2019 Converts 30 777X to 30 787-9 and that 11 777X are still iffy.
    2019 Converts 29 A380 to A330-900 but unconfirmed and in November changed to 50 A350-900s

    • Realistically, EK will probably not take most of the 777-9s and prefer smaller aircraft like A321XLRs, 787-9 and A350s. And they are big enough to get away with it, without so much contractual damage. They demonstrated so before.

      • Would Emirates cancel the last 8 A380 too? I guess that wouldn’t be cheap.
        Sure they want to cancel more 777-9. If they can’t get 787-9 earlier in change of 777-9, they might get their A350-900 earlier.
        For XLR they might need to wait many years.
        At least Emirates want to have planes delivered.

  7. Message from management to unions at Boeing and British Airways – please go on strike.

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